MD3037 Adult Education Budget and Free Courses for Jobs Commissioning

1.1.    Under cover of MD2371, the Mayor approved the competitive procurement of AEB provision with a value of approximately £130m used to match-fund a proportion of the European Social Fund allocation for London. As a result of the procurement, the GLA entered into contractual agreements with training providers over four academic years (2019-23) to deliver AEB provision. These contracts are to conclude at the end of the 2022-23 academic year.
1.2.    Under cover of MD2718 and MD2763, the Mayor approved the commitment up to £16m of unallocated funding from the AEB and the National Skills Fund, to be awarded through a competitive process. This funding is delivered through the Good Work for All (GWfA) programme over two academic years, which is scheduled to conclude at the end of the 2022-23 academic year.
1.3.    As the GWfA and AEB procured programmes conclude at the end of the 2022-23 academic year, arrangements need to be put in place to secure future provision from that point (for up to three academic years, starting from the 2023-24 academic year). A competitive process must be conducted to identify recipients of AEB and FCFJ funding, in order to allow agreements to be entered into and to allow new, independent training organisations to apply for such funding. 
 

2.1    To support continuity of provision, it is recommended that the recipients of grant-funding are identified via a competitive process covering funding for up to three academic years (2023 26). This will include the approval of up to £100m of AEB funding; and up to £30m of ringfenced FCFJ budget. 
2.2.    Subject to Mayoral approval and budget availability at the point of award, grant awards will be made for two academic years (2023-24 and 2024-25) with the possibility of extending the funding agreement for an additional academic year (2025-26). A minimum grant award value of £100,000 per academic year, and a maximum of £1.8m per academic year, will apply – of which providers can spend up to a ringfenced £750,000 per academic year on qualifications funded through the FCFJ Level 3 offer. Bidders will be required to bid for the same level of funding for each of the three academic years, but in case of underperformance will be able to carry forward up to 3 per cent of their annual allocation across academic years, subject to GLA approval and budget availability. Any underperformance will be subject to a monitoring review process by the GLA, which will be outlined in the GLA AEB Funding Rules document. The GLA will arrange quarterly monitoring and review visits to discuss performance against annual and lifetime financial profiles. The frequency of monitoring and review visits, and reporting requirements, may be increased if a provider is underperforming or there are other concerns around delivery. As payments will be based on actuals, underperformance may lead to reduced grant values.
2.3.    The proposed expenditure and related competitive process is aimed at supporting the Mayor’s priority sectors. The policy intent for this programme will have an emphasis on progression into jobs in the digital, health and social care, hospitality, green economy and creative industries sectors. It is envisaged that this programme will include job outcome payments at the flat rate of £400 per job, in addition to the funding secured via relevant AEB provision, which will meet the GLA defined standard for “good work”.
2.4.    A prospectus document, application materials and funding agreement will be prepared and issued, setting out these priorities as well as outlining the overall approach to the award of funding in line with the prevailing GLA AEB Funding Rules. 
2.5.    It is proposed that only UK-registered learning providers with an established delivery site located within London and the London fringe (see Appendix A) are eligible to apply for this funding. Bidders will also need to meet criteria concerning quality of provision and financial due diligence, as set out in the GLA AEB Funding Rules, in order for their bid to be considered.
2.6.    It is proposed that the competition is launched in mid-October 2022 with applications closing in the second half of November 2022, giving bidders six weeks to complete their applications. The prospectus and other necessary documentation will be sent out to the AEB Mayoral Board, for them to note and comment upon, closer to the launch date. Existing grant and procured AEB providers (including GWfA providers) will also be eligible to apply to this competition.
2.7.    Market-warming events will take place after the Jobs and Skills for Londoners competition launch. Bidders will complete their applications on GLA OPS. Bids will also be evaluated by officers using the GLA OPS system. Successful bidders will be awarded funding based on the highest-scoring submissions (subject to meeting all GLA financial due diligence requirements).
2.8.    Awards will be made (subject to budget availability at that point) in accordance with the full bidding amount or on a pro-rata basis if necessary, for either AEB or FCFJ funding.
 

3.1.    Section 149(1) of the Equality Act 2010 provides that, in the exercise of their functions, public authorities, of whom the Mayor is one, must have due regard to the need to:
•    eliminate discrimination, harassment, victimisation and any other conduct that is prohibited by or under the Equality Act 2010
•    advance equality of opportunity between persons who share a relevant protected characteristic and persons who do not share it
•    foster good relations between persons who share a relevant protected characteristic and persons who do not share it.
3.2.    Relevant protected characteristics are age, disability, gender reassignment, pregnancy and maternity, race, religion or belief, sex and sexual orientation.
3.3.    The Mayor is required to comply with the duty set out above in making the decision set out in this decision form and any future decisions relating to the AEB or the FCFJ made pursuant to those arrangements, which will be subject to separate decision forms.
3.4.    The aim of the AEB and the FCFJ is to improve opportunities for people who are disadvantaged in the labour market. Many potential AEB and FCFJ participants have one of the protected characteristics listed above. The GLA’s AEB and FCFJ provision will support a range of groups, particularly the most disadvantaged people not currently receiving sufficient support into employment or education. These include young adults who are not in education, employment or training; people without basic skills; and people who are workless. It will also support Londoners in low-paid/low-skilled jobs.
3.5.    An Equality Impact Assessment has been prepared setting out how the grant-award competitive approach might impact on different groups, including those who share protected characteristics. The Equality Impact Assessment will ensure that the grant-award competitive approach will not reduce the existing range and breadth of provision available to London residents. Furthermore, the assessment will focus on the fairness and inclusivity of the competitive approach by analysing and addressing, with appropriate mitigations, the impact on learners in equality groups, i.e. Londoners who share protected characteristics under the Equality Act 2010 or are part of other vulnerable groups.
 

4.1.    The allocation of AEB funding via competition is part of the implementation of the commitments made in the Mayor’s Skills for Londoners Strategy, to: 
•    empower all Londoners to access the education and skills to participate in society and progress in education and work
•    meet the needs of London’s economy and employers, now and in the future
•    deliver a strategic city-wide technical skills and adult education offer.
4.2.    The key risks are set out in the table below:

4.3.    No GLA officer involved in the drafting or clearance of this MD is aware of any conflicts of interest with the proposals set out in this form.

5.1   Mayoral approval is being sought for expenditure of up to £130m on both AEB provision and FCFJ programme to provide training and qualifications with an emphasis on progression into jobs in the Digital, Health and Social Care, Hospitality, Green Economy and Creative Industries sectors. This will include the approval of up to £100m of AEB funding and up to £30m of ringfenced FCFJ budget funded by the DfE as per their memorandum of understanding letter. The FCFJ funding from the DfE will be £30m over the three academic years and is ringfenced, with a risk of decreased allocation for future years if there are any underspends. If there is an overspend by any of the providers, there is a provision of up to 110 per cent of the grant allocation as agreed within the MOU letter from DfE. 
5.2   The funding is expected to be used across three academic years (2023-24, 2024-25 and 2025-26), however this will straddle across the Authority’s financial years as per the indicative expenditure profile in Table 1 below. Budget allocations for 2023-24 up to 2026-27 will be subject to approval through the annual budget setting process. The funding for this programme is external funding with no staffing costs anticipated to arise. As this funding is multi-year, it is subject to available funding and there should be appropriate break clauses in the agreement. Underspends from each year will be clawed back from the DfE for the FCFJ and will not lead to a call on GLA core resources whilst underspends from the main AEB provision will be added back the larger AEB pot that can be reused in the future with no impact in core GLA resources. 
Table 1:

6.1.    The foregoing sections of this report indicate that certain of the decisions requested of the Mayor concern the exercise of the:
•    GLA’s general powers, falling within the GLA’s statutory powers to do such things considered to further or that are facilitative of, or conducive or incidental to, the promotion of economic development and wealth creation, social development or the promotion of the improvement of the environment in Greater London; and in formulating the proposals in respect of which a decision is sought, officers have complied with the GLA’s related statutory duties to:
o    pay due regard to the principle that there should be equality of opportunity for all people
o    consider how the proposals will promote the improvement of health of persons, health inequalities between persons and to contribute towards the achievement of sustainable development in the United Kingdom
o    consult with appropriate bodies
•    ministerial functions delegated, by the Secretary of State for Education, to the Mayor pursuant to section 39A of the Greater London Authority Act 1999. 
6.2.    In taking the decisions requested, the Mayor must have due regard to the Public Sector Equality Duty – namely the need to eliminate discrimination, harassment, victimisation and any other conduct prohibited by the Equality Act 2010; and to advance equality of opportunity, and foster good relations, between persons who share a relevant protected characteristic (race, disability, sex, age, sexual orientation, religion or belief, pregnancy and maternity, and gender reassignment) and persons who do not share it (section 149 of the Equality Act 2010). To this end, the Director should have particular regard to section 3 of this report.
6.3.    Should the Mayor be minded to make the decisions sought, officers must ensure that they:
•    do not commit to any expenditure which relies upon AEB, FCFJ or any other funding before its availability is confirmed
•    conduct the funding application process is a fair and open manner by reference to published objective evaluation criteria, in accordance with the GLA’s Contracts and Funding Code and all applicable AEB funding rules
•    enter into and execute funding agreements with successful applicants before any commitment to fund is made
•    as it is proposed that funding be awarded that extends beyond the current Mayoral term, ensure that the funding agreements contains termination for convenience rights in favour of the GLA; and that the milestones/outputs associated with the GLA funding are configured and managed in a way so as to avoid abortive expenditure being incurred should a successor administration choose to exercise such rights.   
 

7.1.    The activities and timelines are as follows:

Appendix A – Map of London and its fringe authorities