Colleges will be disappointed by DfE funding announcement, says AoC

Julian Gravatt, Deputy Chief Executive, Association of Colleges, said: “Colleges will be disappointed by the funding announcement today by the Department for Education.

“Less than six months ago, in the post-16 white paper, DfE ministers promised funding per 16-18 student would be maintained in real-terms in the following year. The DfE calculation that there will be a 1.6% increase shows that this promise hasn’t been kept, and right now, there is a lack of information on the overall budget.

“Statements accompanying the white paper also promised an £800 million cash increase in the 16-18 budget in the DfE’s 2026-27 financial year, but this will mostly be eaten up by the additional 20,000 plus 16 to 18-year-olds enrolled in autumn 2025. These extra students recruited by colleges in autumn 2025 will bring extra income in the 2026-27 academic year (after a one-year lag) but also extra costs associated with more teachers, staff and teaching space. This may leave very little money for pay rises in 2026-27 given that colleges are operating with funding that assumes no or minimal inflation.”