MD3006 Adult Education Budget Procured Contract Variations - May 2022

1.1    Following the December 2021 Adult Education Budget Performance Point review process, projects that were significantly underperforming against their reprofiled targets were required to produce recovery plans in order to support performance improvement in line with the AEB Procured Provision – Managing Provider Performance document published on the GLA website. Achievement against the reprofiled year-to-date financial targets at R08 were reviewed as part of the May Performance Point review, and recommendations are set out below. Mayoral approval is being sought for reduction amounts that exceed the SfL Programmes Board threshold.
1.2    For the May 2022 Performance Point review, providers whose projects performed at 90 per cent or above of their profiled contract learner number targets and spend – based on their 2020-21 end-of-year Individualised Learner Record (ILR) (R14) data and year-to-date March 2022 ILR (R08) data – and whose projects met the conditions set out in the GLA AEB 2019-23 Funding and Performance Management Rules for Procured Providers, were invited to request contract increases. 
1.3    In reviewing performance against European Social Fund (ESF) outputs and results, ESF learner numbers were used as the main performance indicator; however, significant underperformance against other targets was also considered. Previous growth awards were also taken into consideration, to ensure that the lifetime increases did not exceed 10 per cent of the original contract value as required by the funding rules. 
1.4    Based on this assessment, total contract increases of £808,398 were approved by the SfL Programmes Board, to be funded by the overall AEB on 25 May 2022.
 

2.1.    To determine recommendations for contract reductions, earnings against allocation were used as the main indicator of underperformance. Officers projected earnings for each provider; where projected earnings were more than 20 per cent lower than the current allocation for the 2021-22 and/or 2022-23 academic years, and the difference was greater than £50,000, officers have recommended contract reductions to bring contract values for the remaining academic years in line with projected earnings and performance. Targets will be reduced in line with any financial reduction made. 
2.2.    Providers in scope for contract value reductions based on the above criteria were offered an opportunity to submit a business case if they could provide evidence or new information to support the delivery of their full allocation. Following consideration of business cases, the proposed total value of reduction is £1,069,986. Of this total, one recommended reduction (£593,038 of total value shown above) exceeds the SfL Programmes Board-approval threshold as set out in Table 2 of Appendix A. This reduction was increased from our original recommendation at the provider’s request. 
2.3.    MD2894 set out details of approved reductions to AEB Procured contract values resulting from the 2020-21 reconciliation process based on the allocation and delivery values for that academic year. One project was in the process of having a contract variation approved and therefore was not reported. Errors were identified in the values reported for two other projects. The revised reconciliation figures are set out in Appendix A. These are separate to the reductions recommended following the May performance update.
 

3.1    In carrying out any functions in respect of the AEB, the Mayor will comply with the public sector equality duty under section 149 of the Equality Act 2010.
3.2    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.
3.3    Relevant protected characteristics are age, disability, gender reassignment, pregnancy and maternity, race, religion or belief, sex, and sexual orientation. 
3.4    The Mayor is required to comply with the duty to have due regard, detailed above, in making any decisions relating to the AEB Procured programme.
3.5    The aim of the AEB and the ESF is to improve opportunities for people who are disadvantaged in the labour market. The AEB Procured programme has specific targets to support groups with protected characteristics including female learners; learners from Black, Asian and ethnic minority communities; and disabled learners. The recommendation to remove funding from an underperforming project will allow the GLA to more effectively support disadvantaged Londoners by reallocating unused funds to other projects that also support disadvantaged Londoners, such as people without basic skills; young people not in education, employment or training; and those who are unemployed or in receipt of a low wage.
 

There are no conflicts of interest to note for any of those involved in the drafting or clearance of the decision.

Links to Mayoral Strategies and priorities
4.2    The proposals set out in this MD will help to ensure that the funding available to the Mayor for employment and skills provision through the AEB Procured and ESF programmes is being spent effectively to support Londoners in line with the Mayor’s priorities as set out in the SfL strategy. The proposed contract variations are expected to improve the deliverability of the programme over the remaining contract term.
 
Risks arising/mitigation
4.3    There is a risk that applying the AEB Procured contract reductions could affect the ability of providers to meet demand if performance improves. This will be mitigated by the opportunity for providers to request contract increases of up to 10 per cent of the overall contract value if they can demonstrate good performance at the next performance point.
 

5.1    Approval is being sought for the reduction of £593,038 of AEB Procured contract funding. The four-year AEB Procured programme was formally approved under MD2375. 
5.2    Mayoral approval is being sought as the reduction amount exceeds the SfL Programmes Board threshold (as outlined in the AEB Assurance Framework). The funds will be returned to the central AEB Procured budget and will be repurposed for eligible projects.
 

6.1    Section 39A of the Greater London Authority Act 1999 permits the delegation of ministerial functions to the Mayor, subject to certain limitations and conditions. This forms the basis of the delegation to the Mayor of AEB functions from the Secretary of State for Education. A particular limitation of the delegation is that the usual power of delegation by the Mayor is not available in respect of section 39A-delegated functions. 
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 Mayor should have particular regard to section 3 (above) of this report.
6.3    Should the Mayor choose to make the decisions sought officers must ensure that the reductions proposed are documented in accordance with the provisions of the contracts with the providers concerned, those agreements being varied before any reliance is placed upon the new figures, profiles and related details where necessary.
 

Appendix A – AEB Procured Contract Variations