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Post-19 Further Education and Skills Organisation Landscape and the role and creation of the Skills Funding Agency. January 2009. 1.

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Post-19 Further Education and Skills Organisation Landscape and the role and creation of the Skills Funding Agency

  • January 2009


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Context and Challenge and the role and creation of the Skills Funding AgencyPolicy Led - response to 07 Machinery of Government announcements and the White Paper:-Raising Expectations: Enabling the system to deliver tackling education and skills challengesby:-giving Local Authorities the leadership for delivering new entitlements for all young people in parallel to their Connexions and integrated youth services roles-streamlining the adult skills system to better support World-Class Skills and make faster progress on delivering a demand led system and achieve our 2020 skills ambitions

The change will benefit learners and employers

Funding in the hands of learners and employers

(demand led system)

Streamlined and

integrated service for employers

Integrated advice and guidance services for learners

More young people and adults with the skills employers need

Coherent offer


all young people

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Understand market and the role and creation of the Skills Funding Agency

Set objectives

Set regulatory framework


Assess performance

UK Employment

and Skills


Sector Skills






the qualifications on offer


the offer






and Providers

Policy Investment strategy

Funding andSettlement


Demand-side focus




and Skills



Regulatory focus



Programmes for Students


Supply-side focus

Supporting colleges and providers



Further Education and Skills ModelA new landscape to support a demand led systemOpportunity taken to clarifyand confirm new roles and responsibilities

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National, Regional and Local Landscape: and the role and creation of the Skills Funding Agency

National priorities reflected in regional and local strategies with customised local delivery

Defining Demand

Supply Response


“State of the nation” defines national needs, progress, gaps


Allocate funds in light of DIUS targets

Skills Brokers

Within business support acts to generate employer demand and take up in line with needs


Identify skills demands to meet regional economic needs

SFA Brokers

Provider partnerships to respond to strategic skills needs, responds to major redundancies etc.

MAAs with ESBs

Identify skills demands to meet city / regional economic needs

Local self-organised networks

Networks of providers work with local partners to align local demand and supply

LAAs with LSPs

Identify skills demands to meet local community needs

Define funded qualification of QCF and sector compacts

Define priorities for broker / providers in delivering Train to Gain


Identify sector skills needs

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Leading the system and the role and creation of the Skills Funding Agency

Determining Overall Investment and Priorities

Determining Performance System (Framework for Excellence)

Responsible for meeting the Skills PSA

Responsible for the Further Education Sponsorship and colleges and learning providers contribution to DCSF targets

Responsible for Advising DIUS on the Skills needs of the Country, including regional strategic needs

Monitor and challenge performance of employment and skills system

Managing the FE and Skills Research Function

Managing the SSCs and ensuring their effectiveness and advising on re-licensing

Determining the Skills offer for their vocational area

With the SFA raise employer demand for Skills

Determine with SFA and Jobcentre+ the Regional Skills strategy and manage the Skills brokerage service

Further Education and Skills Landscape

New Roles and Responsibilities





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Lead and provide the four client gateways (Train to Gain, Apprenticeship, Advancement agency and the direct learner responsive service) and underpinning systems

Funding colleges and learning providers

Work with LA’s on MAA’s

Colleges and Learning Providers meeting student and employers learning and skills requirements

Cooperate with LAs, ES Boards and each other to pursue the skills needs and to provide a range of support services of their choice which could include peer assessment, staff development programmes, shared service and procurement

Regulate the qualifications offer

Support college and learning providers performance and facilitate self-regulation Sector Innovation

Provide an independent view of college and learning providers Performance.

Further Education and Skills Landscape

New Roles and Responsibilities (2)






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Objectives for a ‘demand-led’ market Apprenticeship, Advancement agency and the direct learner responsive service) and underpinning systems

MOG created the opportunity to accelerate the introduction of a demand led system- as outlined in World Class Skills and the FE White Paper.

A radical vision for a ‘demand-led’ FE market where we establish a new Skills Funding Agency which acts as the regulator, funder and commissioner for a much more active and transparent market. The challenge is to translate words into practical, agreed solutions.

  • Target outcomes for the FE market include:

  • Economic growth through global competitiveness

  • Reduced unemployment/unemployability

  • Social inclusion and cohesion

  • Culture of life-long learning

  • Efficient use of public funds

  • Market management objectives include:

  • ‘Light touch’ regulation - risk based, low burden, intervention to support the countries needs

  • Demand-led, funding following recruitment

  • Greater self-regulation

  • Support focused on government priorities

Supply Market Management Demand

Target Outcomes

  • Objectives for demand side include:

  • Informed customer choice

  • Increase in employer-led demand

  • Greater alignment between individual and employer demand

  • Increased and more effective take up by disenfranchised and disadvantaged groups

  • Increase % of population with Leitch Level 2 & 3 qualifications and apprenticeships

  • Objectives for the supply side include:

  • Demand-led, responsive provision

  • More innovation and diversity of provision

  • More self-direction and support

  • Higher quality and stronger reputation

  • Integrated, simpler interface with government regardless of funding source

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Design principles Apprenticeship, Advancement agency and the direct learner responsive service) and underpinning systems

High level design principles which will be used to test effectiveness of final model

Demand Led

  • Be learner and employer driven providing choice,

    and coherent and accessible services at every level.


Higher level


  • Funding follows learner. Simpler process longer contract time

  • Co-ordinated target setting and commissioning across government, national and regional use of MAA;s and LAA’s

Regulatory model

Fair and robust

intervention role

  • Clear rules of intervention

  • No ‘hand-holding’ of providers

Efficiency and VfM

  • Standardise and streamline,

  • Reduce regulation and bureaucracy

Coherent set of services

  • Simple, coherent set of services for learner, employer and provider

  • Common information, measures, account management.

Operating model

Insight and capability

  • Use of information, analysis & research

  • New capabilities aligned to role

‘Shorter’ arm’s length

from Ministers

  • Agency part of DIUS

  • Rapid response to policy

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The Skills Funding Agency – Organisational Model Apprenticeship, Advancement agency and the direct learner responsive service) and underpinning systems

There will be four client publicly focused gateways , supported by a

set of underpinning functions and internal corporate functions

The four gateways are:

  • National Apprenticeship Service – lead the development and delivery of the new apprenticeship programme, increase employer engagement, manage the apprenticeship vacancy matching service and increase trainee participation. (Implementation April 09)

  • Train to gain-Employer responsiveness delivering a national skills service to all sizes of business in all sectors and National Employer Service: aimed at raising skill levels of the workforce, secure a culture change that makes employers value skills; a skills system which is demand led and employer choice influences spend and qualifications, employers value and seek brokerage interventions to help them findsolutions. (existing service enhanced)

  • Adult Advancement and Careers Service – delivering a outsourced service which is universal,

    integrated with Jobcentre Plus and coherent with services for young people and HE. ( pilots taking place 2008/2010)

  • Learner Responsiveness – direct entry -funding Colleges and Learning Providers who are responding directly to the learner. This area captures the new arrangements proposed for greater integration of employment and skills service to those out of work, specialists provision including Offender Learning. (existing service streamlined and enhanced)

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Skills Funding Agency Apprenticeship, Advancement agency and the direct learner responsive service) and underpinning systems

  • Shared or Joint Service with DCSF and or DWP

    or between YPLA/SFA/Local Authorities

    Core/National Functions

  • In the light of Grant Letter set and publish skills priorities

  • Management of the National Apprenticeship service

  • Management of National Employer Service including Train to Gain

  • Set funding rates and guidance

  • Set up and manage an approved provider accreditation register

  • Manage the learner responsive system: skills accounts and integrated

    employment and skills

  • Through a college and learner provider business account management system:

     Run the allocation and settlement system

     Manage the performance intervention system and reallocation

     Manage the ESF budget

  • Management of the raising demand sideinterventions e.g. Skills Pledge, Compacts,

  • Sector Skills Councils Agreements, Agreements with Business Link on Brokers

  • Management of the Adult Advancement and Careers Service and the national advice line

  • Adult Learner Support, including supporting student from pre-employment into training and work

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Core/National Functions (2) Apprenticeship, Advancement agency and the direct learner responsive service) and underpinning systems

  • Management of the Capital Investment programme

  • Designing and manage the FE IT architecture including underpinning systems for MIAP, the Learner Registration service, QCF etc

  • Run the Data collection service including data exchange and reporting

  • Manage the SFA Corporate Services including Departmental Reporting, Internal

  • Communication, HR, internal finance and property management.


  • Skills Advocacy and partnership building. The responsible agency to facilitate the skills

    and innovation needs of the area are met.

  • Championing and delivering on the raising demand slide initiatives such as Skills Pledges.

  • In the light of the UKCES determining regional SkillsRequirements

  • Development of the Regional Skills and Employment plans through the Regional Skills partnership or implementing the Skills and Employment Strategy such as LESB.

  • Work with central Capital team to draft and publish the underpinning regional Capital

    investment plan and infrastructure changes.

  • Supporting National Office on provider performance

  • Ensuring Skills are prioritised in MAAs and LAAs

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The Children, Skills and Learning Bill Apprenticeship, Advancement agency and the direct learner responsive service) and underpinning systems

The Children, Skills and Learning Bill being introduced in Feb 2009:

  • As part of this Bill, it is proposed to create a new statutory office holder, the Chief Executive of Skills Funding, who will have specific powers and duties including responsibility for the SFA.

  • The SFA will be agency of DIUS, with staff provided by the Secretary of State.

  • The aim is to ensure the autonomy and academic freedom of colleges and providers and in line with best practice in the public sector, ensure decisions are taken as close to the frontline as possible.

  • To ensure this a duty to collaborate will be placed on colleges and learning providers.

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Action Apprenticeship, Advancement agency and the direct learner responsive service) and underpinning systems


2009 h1

2009 h2


To 2012

Role of SFA in

SFA commercial

Segment providers by


Transition wave 2 and 3 providers




market defined

strategy agreed

risk profile and into

wave 1 providers


Monitor and

transition waves

Publish FfE



Market change plan

results on web


Add provider groups

Market transformation

to FfE

Completed sharing

Launch FfE for major

and outsourcing

provider groups

Review shared/



SFA legislation passed




sharing and






SFA business

NAS launched




model agreed

Any outsourcing

SFA est (Apr)



contracts agreed



Service delivery model


Shared frameworks

TUPE complete


and strategies agreed



Start shard

Sharing process

in shadow form


SFA year

mechanisms agreed


2 budget

Potential outsourced

functions specified for


potential providers


Start shared platform

SFA T&Cs and


Partners for sharing

grading confirmed

SFA starting

identified and briefed

SFA locations


Transition to


Plan for interim


final IM

Agree core functions


Roles and processes

to be shared and



Key capabilities of SFA

Optimise interim operating

Interfaces, shared functions



SFA resource

Consultation with TUs

IS strategy


Potential for

Interim IM

sharing agreed


Budget and


SFA organisation

Information management

resource allocation