DIUS's Departmental Report 2008 - Innovation, Universities, Science and Skills Committee Contents


Memorandum 3

Letter from the Rt Hon John Denham MP, Secretary of State for Innovation, Universities and Skills to the Chairman, Phil Willis MP

  During Parliamentary Questions last week you asked me about budget transfers between Further Education and Skills and Higher Education in the department's Resource Accounts for 2007-08. I said I would write to you to explain the background and effect of these transfers.

RESOURCE ACCOUNTS AND BUDGETARY TRANSFERS

  The DIUS 2007-08 Resource Accounts reported an underspend in 2007-08 of £172 million on the Further Education and Skills budget. The Accounts also show an overspend on Higher Education expenditure of £128 million. A transfer of £116 million was therefore made from Further Education and Skills to Higher Education in 2007-08 to address the overspend.

  Of the £116 million transferred, £67 million was temporarily made available from Further Education and Skills to Higher Education. This relates to payment made to students for the third academic term (these payments were made within the 2007-08 Financial Year as a result of Easter falling earlier than usual). The remaining £49 million was a permanent transfer from Further Education and Skills to Higher Education in 2007-08. The budget for these payments has now been allocated to Higher Education within the 2008-09 Financial Year and the £67 million has been reallocated to Further Education and Skills budgets.

REINVESTMENT OF £115 MILLION IN FE AND SKILLS PRIORITIES

  Separately, in response to emerging underspends in 2007-08, the LSC made payments in 2007-08 to meet commitments that would normally have fallen in 2008-09. This reduced the required spend on some LSC budgets in 2008-09, allowing the flexibility to invest £115 million in additional FE and Skills priorities in 2008-09 including:

    —  Our leadership and management offer in Train to Gain for small and medium sized businesses.

    —  Enabling adult learning providers such as WEA to continue to offer provision that contributes to the wider adult learning offer.

    —  Supporting adult learners to gain employability skills.

    —  Ensuring the continued roll out of National Skills Academies.

    —  Funding pathfinder Networking Projects designed to unlock the talent of the FE workforce to drive business innovation through knowledge transfer.

    —  Supporting an additional 1,200 adult apprenticeships in the best training companies as announced through WorkSkills in June this year.

    —  Expanding Level 3 pilots focused on removing barriers to training.

  You will also be interested to know that we expect to publish shortly our LSC Grant Letter for 2009-10, setting out our strategy for continuing investment in further education and skills.

October 2008





 
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