Select Committee on Education and Skills Minutes of Evidence

Supplementary memorandum from Mr John Healey MP (DfES 10)

  I thought it would assist the Committee if I set out some key figures on ILAs and set out in more detail why, as I explained to the Committee on Wednesday, it is not possible at present to provide a forecast of the end of year overspend.

  The total budget available in England over the two years 2000-01 and 2001-02 is £202.1 million, which as you may know includes both DfES budget allocations and £115.1 million which has been recycled from TEC resources. I explained to the Committee that, as a result of the fact that demand for ILAs far exceeded original expectations, we have had to spend more on the programme and more quickly than originally expected. DfES records show that expenditure on the programme in the 2000-01 year and the 2001-02 year up to 23 November totalled £260.9 million, which would suggest an overspend of £58.8 million at that point.

  Again, as I explained to the Committee, there are still significant numbers of payments due in respect of claims already made by learning providers and committed expenditure in respect of learning already booked by providers on the ILA Centre system before it was shut down on 23 November. Because of the police investigation into allegations of fraud and abuse we do not, currently, have access to the Capita's ILA Centre system on which the data is stored. We also need to validate both the claims and the bookings held on the ILA Centre system and take action to recoup monies which have been improperly claimed. As a result it is not possible to estimate the extent of the additional financial commitment at present.

  Officials are currently in discussion with the police to agree the basis upon which the Department and Capita can resume access to the ILA Centre system without the risk of compromising the investigation. I anticipate that these arrangements will be established in the next few days and would expect to be in a position to provide you and members of your Committee an estimate of the total potential overspend within the next 10 days. The overspend will be met from within the Department's existing resources.

  I hope that this provides members of the Committee with helpful clarification of the up to date position.

30 November 2001

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