FE and Skills White Paper: win or bust?

By Ian Pryce, former CEO of Bedford College Group. 

You will know the urban myth that the Chinese word for crisis comprises the symbols for danger and opportunity. Incorrect, but even so, when great opportunities present themselves, they can also carry jeopardy and bring big threats.  Risk and reward are often bedfellows.

The recent FE and Skills White Paper contains some of the biggest opportunities for colleges since incorporation in 1993. They are:

• the development of new higher education provision at Levels 4 and 5, backed by ambitious government targets for participation  
• the introduction of V Levels specifically aimed at those seeking a high-quality alternative to A Levels
• a commitment to the expansion of T Levels, large programmes tailor made for colleges  
• a commitment to the expansion of apprenticeship opportunities for young people, programmes that are unlikely to be offered by schools
• an approach to those who are not in employment, education or training (NEET) that could increase educational participation 16-18 to almost 100%, with colleges the most likely beneficiary of that increase.  

In every case it will need colleges to take risks and invest strongly in new approaches to the curriculum, new staffing, new systems and processes, different marketing, new support services, different learning environments, maybe even different governance approaches. Do colleges have the people, financial resources and energy to fully exploit these opportunities?

At Bedford College we occasionally war-gamed how to fight local competitors if we felt their behaviour was unreasonable/ It always proved successful. For example, when local school sixth forms kept giving parents inaccurate information about the quality of the college’s 16-18 education, we used our formidable external communications to share factually accurate information that highlighted just how poor those schools were in comparison and developed our own academic sixth form college to compete head on. Very quickly schools called for a truce, our sixth-form college became the biggest in Bedford within two years, and some school sixth forms closed not long after.

I give this example because, if you wanted to war-game a set of policies aimed at seriously destabilising colleges, you might very well come up with exactly those in the white paper. That is why they are both opportunities, but potentially big threats too.

Higher education numbers in colleges are in free fall. The audited colleges finance record shows a 30% fall in the last three years, from 68,198 to 47,875. Can colleges genuinely claim to be major players in higher education when HE students represent less than 3% of the sector’s activity? There are now only seven colleges with more than 1,000 HE students. To put that in perspective, there are nearly 2 million undergraduates in our universities. Manchester Metropolitan University has about 27,000, and even the smallest, Buckingham, has nearly 4,000. At a time when universities are struggling financially, but enjoy premium brand recognition, aren’t they much better placed to develop the new HE markets government wants? How likely is it that colleges can reverse the big decline and carve out their own significant market, untouched by competition from world-class universities?

T Levels remain superb large qualifications for those with very clear ideas about their future. Their size means schools are unlikely to offer them, but numbers remain small and below target; they are not mass-market qualifications and depend on local employers.  Colleges cannot possibly replace all their old Level 3 enrolments with T Levels, significantly reducing college incomes, unless we continue to see further erosion of the original concept, so they become very like the BTECs they replaced.

One solution to a loss of income is clearly expected to be V Levels. They are a compelling idea educationally. However, they are designed at a size that perfectly fits school timetables rather than the timetables and management structures of colleges. They are also being marketed as courses you can take alongside A Levels. Many colleges do not have an A Level offer and so cannot compete for that mixed market. It wasn’t that long ago colleges were told to ditch small qualifications – certificates and awards – and make sure students studied large diploma qualifications. Going back to smaller, less lucrative qualifications could be very problematic.

Apprenticeship numbers in colleges have also been falling sharply. The audited finance records show that in the last three years adult apprentices in colleges have fallen 20% and 16-18 apprentices by 3%. The employer landscape of the UK makes growth hard.  The average employer is now smaller than my extended family, so unlikely to take on apprentices regularly. Of the 1.4 million UK employers, only about 9,000 employ more than 250 staff, and they are spread unevenly. This is not an obviously fertile landscape for consistent annual apprentice recruitment.

The move to tackle NEETs through auto-enrolment into a college is novel and a potential gamechanger. However, there is evidence that any “enroller of last resort” may be avoided by the more aspirational students and parents. Part of the appeal of colleges is that every student has made a choice to be there. It has been hard to shake off the image of colleges being the place for “other people’s kids”. A new image as the place for conscripts who don’t want to be there is even worse and could scare away those who want an institution full of highly motivated students.  V Levels will make it easier for them to opt for a school instead.

Finally, the freezing of adult student funding rates and adult numbers seems unlikely to be reversed. There will inevitably be a point where the provision is simply financially unviable, and colleges have a poor track record of replacing government income streams with much higher fee income from paying customers.

If universities seize the higher education market, schools make big inroads with V Levels, T Levels continue to increase slowly, apprenticeships and adult numbers continue to be constrained with funding reduced in real terms, and NEETs scare away more motivated students, the threat to colleges is existential.

This Chinese year of the fire horse is said to be characterised by dramatic change, fast movement and high energy. The last year of the fire horse was 1966, the year of the Cultural Revolution and England’s World Cup triumph. Let’s hope the promised skills revolution sees colleges win in the same way.