College funding and the economic context

CEO, ColegauCymru

CEO, ColegauCymru

Author: Dr John Graystone, CEO of ColegauCymru / CollegesWales.  John Graystone has a regular column in the Western Mail, in which a version of this article first appeared in March 2013.

Funding allocations 2013/14

Further education (FE) colleges have recently received their provisional funding allocations for 2013/14.

The Welsh Government has honoured its pledge to increase by 1% its core funding and investment in the Pathways to Apprenticeship and Adult Skills programmes – an overall increase of £5m. Two colleges receive more than this to account for the reorganisation of local school sixth forms.

This settlement marks the end of the current three year funding cycle. Colleges are keen for agreement on another three year cycle to give them a degree of certainty when planning courses and enrolling students.

A welcome – in broad terms

ColegauCymru has broad welcomed this increase in funding especially as public funding is tight. However, inflation currently stands close to 3%. A weakening pound and rising fuel and energy costs mean that inflation is unlikely to fall in the near future. Thus next year will see an overall real terms reduction in college funding. Colleges will continue to seek efficiency savings and explore opportunities for generating income from other sources.

George Osborne’s budget will cut revenue funding for Wales by a further £50m so colleges have to be prepared. The recent mergers of some colleges and the development of strategic alliances with other education and training bodies will help the sector as a whole to weather the harsh economic climate. The economy is still fragile with a risk of a triple dip recession. Indeed, only the temporary boost to the economy provided by the Olympic Games in the three months to September 2012 has provided any recent growth.

Uemployment in Wales in the three months to December 2012 rose by 6,000 to 127,000 (8.6%). Wales currently has the highest unemployment rate of all the UK nations.

The importance of skills in tough times

Previous recessions have taught us the importance of investing long term in skills. Colleges are playing an active part in preventing the emergence of a lost generation with little or no experience of work and possessing low levels of skills. A key challenge must be to raise standards of literacy and numeracy.

The Deputy Minister for Skills has announced an additional £20m – a result of Plaid’s support for the Welsh Government’s budget – to be invested annually for the next two years in increasing the number of apprentices. This presents a major opportunity for colleges to work closely with employers in raising skills levels. Employers are encouraged to take on apprentices to enable young people to be equipped with the skills that Wales needs and to develop higher level skills.

Employer engagement is one of the top priorities for FE. Colleges need to place increasing emphasis on developing enterprise and ensure they are the first port of call for employers.

A vocational economy

Huw Evans’ seminal review of qualifications emphasised the importance of raising the profile of vocational qualifications in Wales. Germany has been described as a ‘vocational economy’. That surely should be a benchmark for Wales – a country where young people aspire to receiving a high quality vocational award. Times are tough. But our innovative colleges are making a major contribution to improve the economic performance of Wales by raising the skills profile of our workforce. We need to be prepared for an upturn in the economy. And upturn there surely will be.


About Claire Roberts

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