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Taxpayer is paying over the odds for UTCs

10 June 2020

In a report today the Committee calls on the Department for Education to set out a new clear roadmap, with financial targets and new measures of success for students, for University Technical Colleges. 

University Technical Colleges (UTCs) were established in 2010 as an innovative model of secondary education focused on providing practical, technical education and qualifications for young people aged 14 to 19. However, the Committee's report finds that UTCs have struggled to provide a distinctive, financially sustainable education offer.  

At January 2019, the 48 open UTCs were operating at 45% capacity on average, and ten of the original UTCs had already closed. Over half of UTCs were rated as less than good by Ofsted in October 2019, and 14 UTCs accounted for nearly 10% of the total cumulative revenue deficits of all academy trusts in 2017/18.  

Extra funding

The Department has put nearly £750 million into opening UTCs and keep them going, including £680 million in capital funding and nearly £37 million in extra revenue funding. The lack of students means the Department has been propping up the finances of UTCs for several years, and most of the extra funding will not be paid back.  

The Department for Education is nearing the end of a three-year programme to improve the financial and educational performance of UTCs. However, the Committee finds that the Department does not have a clear vision for UTCs in the future, and is a long way from achieving its aim of improving the financial performance of UTCs by summer 2020. 

Student destinations

Designed to provide an education and qualifications outside the standard exam-based measures, the Department has still not defined what success looks like for UTCs, as distinct from other secondary schools. It regards student destinations as a better metric but has not adjusted its performance framework to reflect this, or to indicate how the success of UTCs should be judged. While the limited available data shows that a higher proportion of UTC students go into apprenticeships compared with other secondary schools, most of these apprenticeships are at a level equivalent to secondary school qualifications rather than any higher.

The Baker Dearing Educational Trust – owner of the UTC “brand”, in an unusual setup – receives money from the Department to support the opening of UTCs but also charges each school an annual licence fee. The Committee expressed concern about the Department's apparent lack of interest in what UTCs are getting from paying out taxpayer's money to the Trust in this way.   

The Committee says the Department for Education should now:  

  • Work with those UTCs that have higher occupancy levels to help UTCs that are struggling to attract students.  
  •  Set clear three-year financial targets for each UTC and be prepared to close UTCs that are not meeting those targets at the end of that period.  
  •  Within three months, explain in writing to the Committee how it uses data on student destinations to track the performance of UTCs, and what steps it will take to help parents assess the benefits of a UTC education.  
  •  Work with UTCs to gain assurance about the value schools are getting from payments to the Baker Dearing Educational Trust, and submit its findings to the Committee within three months. 

Chair's comments

Meg Hillier MP, Chair of the Public Accounts Committee, said: 

“An awful lot of money has gone into this idea with good results alarmingly thin on the ground – although it's very hard to tell when the Department hasn't managed in 10 years to say what a good result is. While the Department determines what success is for the students already committed to a UTC education, it needs to look to the future and financial management of UTCs.  

“It is not fair to make this kind of alternative offer to students trying to equip themselves to make a living, and then not ensure that it delivers a sustainable, quality, recognised measure of success for them. For students in UTCs it's not an expensive if innovative experiment, it's their future – more uncertain now than ever as we face what the Chancellor has described as an unprecedented recession. The Department must show us how it is going to make UTC education worthwhile – for students, their parents and the taxpayer.”

Further information

Image:  PA