Stuart Hollis

Alastair Thomson

29 May2012

24+ AdvancedLearning Loans:New challenges, new

chances?

Skills Strategy and Reform Plan

November 2010 July 2011

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Timeline

• Nov. 2010 - plans to introduce FE loans announced following Spending Review

• July 2011 – consultation on implementation as part of New Challenges, New Chances (inc. draft Impact Assessment)

• May 2012 – publication of final Impact Assessment and Equality Impact Assessment (and research into attitudes on loans)

• July 2012 – regulations to introduce loans laid before parliament (to come into force from September 2012)

• April 2013 – loans applications system launch for courses starting in 2013/14 academic year

• August 2013 – first courses funded through loans

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Summary of policy

• Introduction of loans needs to be seen in the context of lower public expenditure;

• Government’s first ASB priority is on young people; those without basic skills; those seeking work;

• Shared responsibility for funding courses for more of those that benefit from learning

• Loans intended to support thousands of learners to continue to access advanced and higher level courses – and individuals will only contribute once they have finished the course and are earning more than £21,000

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Government Investment

11-12 budget (£m)

12-13 budget

(£m)

13-14 indicative

(£m)

Adult Skills Budget 2,835 2,699 2,497

Min. expectation 19+Apprenticeships 644 698 726

Offender Learning 134 132 131

Adult Safeguarded Learning 210 210 210

Learner Support 151 164 177

Information, Advice & Guidance 81 84 87

Skills Infrastructure 62 71 55

Capital Grants 305 279 225

Total Skills Funding Agency 3,778 3,639 3,382

Funding Available to Support the FE and Skills Sector

146 156 154

Government funding available for FE Loans - - 129

GRAND TOTAL ADULT FE & SKILLS 3,924 3,795 3,665

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Balance of investment

£8.5bn16-18 £4.6bn19+ £3.9bn £39bn

On-the-job labour £20bnOff-the-job labour £7bnIn-house training £9bnExternal costs £3bn

individualEmployers

State

Sources: NESS 2009, SFA/NAS & YPLA budgets 2011/12 (England)

NIACE activity to date

• Loans Stakeholders Group (BIS, SLC)

• Adults Learning Extra

• NIACE Policy Committee of Members

• SFA Commissioned research: providers, stakeholders, learners, financial advisers

Emerging themes to date: the 6 P’s

Participation

Providers

ProvisionProgression

Price

Participation

• Age

• Ethnicity / culture

• Widening participation groups

• No EQL policy

Providers

• Restrict the market to fewer providers or open the market over time?

• Staffing• Quality• SLC

• Learners as active consumers... Learners expect success.. Is 80% SR okay?

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Providers 2 - Preparation

As loans are introduced, providers will need to consider how to prepare in the following areas of business:• Budget allocation and budget management• Information, advice and guidance• Course offer and enrolment• Loan application and assessment• Confirmation of learning and payment of loans• Change of circumstances• Loan repayment

Provision

• Some sectors harder to reach than others;

• Impact on certain occupational sectors (eg adult social care, health, child care, education);

• STEM and apprenticeships

• The nature of provision: customers demanding more bespoke provision

Progression

• Within providers

• Effect on people making their first steps or at Level 2

• Importance of impartial advice and guidance

• HE is not a valid model ..... yet

Price

• Charging more or less than the loan value

• Bonuses for achievement? Cash back?

• Rise if fees across the board?

• Price versus payback in different sectors

• Other costs: maintenance, childcare• Financial capability

And Place!

Challenges and chances: the 4 Ts

• Timescale– Implementation and curriculum– Time for promotion

• Transferability– FE is not the same as HE (even HE in FE!)

• Technicalities– Price, planning details, financial planning

• Trust– They won’t move the goalposts, will they?

Interest rates– Between the sector and government

Questions yet to be answered

1. Which courses and subjects will be hit most?

2. Will the quality of the experience will reduce because of price pressures? (Will support that WP learners need get ssqueezed out?)

3. Will be geographical localities where the L3 offer is either limited or non-existent for 24+?

Questions yet to be answered (2)

4. What will the impact will be access to HE for non-traditional groups and in particular subject areas?

5. How demand and supply of loans be balanced? (What will happen if more people want one in one place and not so many in another? How quickly can the system respond to these 'market signals'?

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Further Information• BIS Monthly briefings will provide sign posts to

information and what to look out for and these can be accessed from the BIS 24+ Advanced Learning Loan webpage:

http://www.bis.gov.uk/policies/further-education skills/24-plus-advanced-learning-loan

• If colleges or training organisations have any questions about the implementation of the 24+ Advanced Learning Loan, please contact your Skills Funding Agency relationships manager in the first instance.

• Or email questions to: advancedlearningloans@skillsfundingagency.bis.gov.uk

• Or contact: Andrew King (Department for Business, Innovation and Skills) – 0207 215 1585.

Thank youAlastair Thomson

alastair.thomson@niace.org.uk