Scandal and fraud in the apprenticeship business – again

Education Is A Right2

Despite its silly name (which would fail a seven-year-old a Sats test), Learndirect is a training and apprenticeships ‘provider’ with a seriously large contract worth £158m a year from the Education and Skills Funding Agency (EFSA). It was privatised in 2011 in a £36m transfer to Lloyds Bank, which was 40% owned by the government at that time. An investigation by the Financial Times revealed that in the four years following privatisation the company spent 84% of government-provided cash on payments to managers and financiers, loaded itself with £90m of debt and diverted £20m in dividends from its operating company as profits dwindled. In 2012, it spent £500,000 on sponsorship of the Marussia Formula One team (Financial Times, 15 August 2017).

There is a direct line from Learndirect right back to the New Deal promoted by Blair’s Labour government in 1998, a year after its 1997 election victory, which resulted in the biggest House of Commons majority ever. Renamed the Flexible New Deal from October 2009, it was a cornerstone of Labour policy which seized on the openings by Conservative governments to bring the private sector into state education and then expanded it to all provision including apprenticeships.

In government Labour dropped its demand that 50% of 18-year-olds should attend university and looked to apprenticeships instead to bolster Gordon Brown’s vision of ‘world-class global competitiveness’. In other European countries, particularly Germany, 30% of companies offered apprenticeships compared to 6% in England. In 2008 the ‘Strategy for the Future of Apprenticeships in England’ document led to the establishment of the National Apprenticeship Service (NAS). The National Skills Director of the Learning and Skills Council was put in charge and took over central government funding for apprenticeships from local authorities.

Two additional steps were needed for the policy to be implemented and for disbursement of government funds. First a huge number of training provider businesses were approved to teach job skills, with secured finance from central government. Second, because apprenticeships are demand-led, the government provided employers with financial support and administration costs to encourage them to take on apprentices. Today the minimum apprentice wage is £3.50 per hour for those under 19 and is fully funded by the government. Older apprentices get the National Minimum wage of £7.05 for those under 24, and £7.50 for those over 25.

This outsourcing has created a quasi-business economy which flourishes through patronage and close ties between ministers and their friends in the private sector. The string of government contracts, with high pay at the top end and low pay at the administrative end, extends throughout the employment industry including Jobseeker Mandatory Activity, Community Work Placements etc. The entire set-up is impenetrable and unaccountable. On 1 April 2017, the Department of Work and Pensions instructed staff to stop making referrals to the Work Programme. Learndirect looks to be next.

What about the adult training and apprenticeships that Leandirect is paid to provide? What about the futures of adults in search of employment and the prospects of jobs for young people? A recent report by Ofsted, the government inspectors, found that 70% of Learndirect’s services are well below the expected standard. There are currently 73,000 people on training courses which are supposed to lead to employment or training on the job. These programmes are contracted out, sometimes repeatedly, to smaller companies and Ofsted found them to be inadequately monitored and planned. Learndirect tried to block the publication of the Ofsted report on the grounds that it could lose government contracts and be bankrupted. Exactly so. The outsourcing of education, like that of health, means that the privatised services of state welfare can disappear at any time there is a downturn in profits, leaving thousands of people adrift. In this case the government could not face the loss of its flagship apprenticeship policy and has chosen to support the sub-standard courses with £45m funding for 2017-18. So Learndirect, the private equity-owned company, will be bailed out because the Department for Education does not ‘have the resources to pay other providers’ (Financial Times, 7 September 2017).

Readers of FRFI will remember that the ‘Welfare to Work’ provider A4e was also exposed for embezzlement. There were nine investigations into the organisation’s conduct from 2009 onwards. In 2013 four people were arrested and charged with fraud and forgery, largely for taking credit for jobs they didn’t find. This was institutionalised robbery with falsified signatures and incentives in the bonus system that encouraged staff to make false claims.

David Blunkett, now Lord Blunkett, former Labour Home Secretary and Minister for Work and Pensions, earned £30,000 a year as advisor to A4e. The Ipswich Unemployed Action newsletter reported on Blunkett’s many consultancy jobs including work for property and construction company RLF for which he earned £1,500 for four hours’ work a week. In 2009 Blunkett was instructed by the Office of the Parliamentary Commissioner for Standards to amend his entry in the House of Commons Register of Interests to include a trip to South Africa paid for and organised by A4e after he failed to do so. Blunkett’s standards can be deduced from the fact that he held an advisory post for ‘corporate social responsibility’ at the Murdoch press.

Conflict of interests, lobbying, accountability and transparency are all just words to the ruling class and their beneficiaries. They steal from the state and the working class without shame.

Susan Davidson

Plot against Muslim community exposed


In 2014 a torrent of abuse was launched against schools in Birmingham, Manchester and Bradford about a conspiracy by Islamic extremists acting as school governors in an undercover plot to take over schools – the Trojan Horse.

A wave of Islamophobic racism swept through the media. The retired Commander of Counter Terrorism Control, Peter Clarke, was appointed to lead an investigation into 25 Birmingham schools. Tony Blair joined in, recklessly linking the so-called Trojan Horse plot to the fundamentalist organisation Boko Haram.

Read more ...

Labour’s manifesto on education

Labour’s pledge to recast the state education system as a National Education Service providing free ‘cradle-to-grave’ educational provision ‘as a right, not a privilege’ at first sight seems radical. However, to implement this commitment, a Labour government would have to be prepared, not merely to raise the funds, but to challenge the huge private sector interest in the education business world that they themselves invited in and funded.

Outsourcing every aspect of educational infrastructure from exam boards to payroll has led to significant privatisation of the state education system. The UK takes a large slice of the £130bn educational technology market, with schools paying £900m a year to profit business providers. A complete reversal of Labour’s financial collaboration with corporate interests would be necessary to implement recommendations of the manifesto. The pledge to return to ‘national pay bargaining for teachers and support staff’, for example, is not possible without the abolition of academies, ‘free’ and ‘faith’ schools, as well as selective Specialist, Beacon and City Technology Colleges. These institutions set their own curriculums, admissions policies and wages and conditions for staff and are ‘stand-alone’ autonomous organisations although financed by the state.

Read more ...

Interview with Durham teaching assistant

durham lions

Fight Racism! Fight Imperialism! gives our full solidarity to the Durham teaching assistants who have been engaged in a heroic struggle against Durham Labour council to defend their jobs, wages and conditions. The Labour councillors voted unanimously in favour of 23% pay cuts for the teachers. Our supporters in the North East attended their recent march and rally (Durham teaching assistants continue fight against wage cuts)and interviewed one of the organisers of the campaign, Sam, who is also a teaching assistant. We produce the interview in full below.

Read more ...

Education cuts mean education cuts, Prime Minister

Three issues today demonstrate the determination of the government to attack schooling in England and Wales. The first is the continued fragmentation of the state education system by the introduction of divisive school models such as the ‘free’ schools, sponsored academy schools, specialist schools and now by extending grammar schools. The second is the reduction of school income under the pretext of ‘ending the postcode lottery’. The third attack comes from freezing the overall school budget so that £3bn will be cut by 2019-20.

There is indeed an inherited unfairness in the school funding formula in England and Wales measured by per pupil spending. Inner London schools receive an average £5,918 for each student while in Blackpool it is £3,336. Education Secretary Justine Greening is preparing a White Paper to change the designated school grant from the Department for Education (DfE) to local education authorities to even out the distribution of money and end this ‘unfairness’ (see FRFI 155).

Read more ...