The second non-levy tender is a bureaucrat’s dream...

By: Nick Linford

Writing exclusively for NCFE

Thursday 31 August 2017

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After a delayed, expensive and ultimately aborted exercise, the ESFA is having another go at tendering apprenticeship funding allocations for providers working with small (non-levy) employers.

Up to £650 million is available over the 15 months between January 2018 and March 2019, and around 1,800 eligible organisations will be offered a crack at getting their hands on some of it.

For hundreds of companies, those training providers that specialise in apprenticeships, failing to win access to funding would be a disaster, so the stakes are high.

The ESFA has set tough scoring thresholds: if any part of a tender application is incorrect or insufficiently answered, the agency will not hesitate to reject it.

Yesterday, in a surprise move, the DfE announced a tender deadline extension of three and a half days from 23:59 on September 4 to 12:00 on September 8.

It said it had been responding “to a high volume of queries”, even though no new queries had been answered since last Tuesday.

And the deadline for the submission of tender clarification questions has been extended from August 22 to September 1, so the DfE can expect plenty more questions over the coming hours.

Its FAQ document already runs close 5,000 words, and yet the questions keep coming.

Take a closer look at the tender rules and requirements, and it should come as no surprise that there is so much uncertainty about how to interpret them.

The first complexity lies in the confusing way the ESFA has asked providers to work out their own tender cap, which is the maximum they can apply for.

There are four “provider classes” to choose from, and failure to calculate this correctly will invalidate the rest of the tender.

Providers that have never had their own apprenticeship allocation have a tender value cap based on their 2015/16 turnover from their published accounts multiplied by 1.25, or is it, as reported in FE Week, their 2016/17 management accounts?

And what if in the relevant year, their accounting period was extended and thus lasted more than 12 months? Or if their accounting period is January to December, does this mean their 2015 or 2016 accounts?

And just to overcomplicate things further, there are two types of these providers, subcontractors (not new but never had their own allocation) limited to £1.5 million cap, and non-subcontractors (never before delivered apprenticeships) limited to a £750,000 cap.

Then there are tender caps to calculate for existing providers, those that delivered up to £1.5 million non-levy delivery in 2015/16.

Their cap is their 2015/16 turnover multiplied by 1.25 up to a maximum of £1.5 million, but this comes with the same questions as above.

Finally, and most confusingly of all, there are those providers that delivered more than £1.5 million non-levy in 2015/16.

Their cap is only limited to 110 per cent of the value of their non-levy delivery in 2015/16.

Yet non-levy is a type of delivery that did not exist at the time and the ESFA itself has struggled to calculate it with any degree of reliability.

And the tender cap will have to be “verified” by the ESFA before it even considers reading the tender.

Now let’s assume the provider manages the cap verification process; now the really tough bit kicks in.

The sheer amount of time and resource involved in completing this particular tender, in the month of August, is unprecedented.

Whether you are applying for the £200,000 minimum or for many millions, it includes 17 mandatory questions totalling up to 65,200 characters, which is more than 10,000 words.

Then there is a ‘funding volumes and values’ spreadsheet, with up to 2,400 individual cells to complete.

The ESFA has artificially created 18 separate budget lines, splitting 16-to-18s and from adults and then putting each into nine different regions.

Perhaps you have jumped through all the hoops, done all the work, and been successful along with many other providers.

The trouble here is that the ESFA reserves the right to reduce every successful tender in order to stay within the overall funding envelope.

So now your winning tender value has fallen below the £200,000 minimum, and you are given nothing.

All that work with a winning tender but no contract.

What a mess, but on the plus side, it’s kept the civil servants busy…  

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