We agreed with the Learning and Skills Council (LSC) on 27 January that Sir Andrew Foster would undertake a review of the LSC further education capital programme to assess:
the main causes of the increased demand for capital funding;
the internal LSC processes and scrutiny of the capital programme and how these could be improved; and
any further steps that can be taken to ensure that for the future the expectation and demand for capital funds are kept in line with budget requirements, bearing in mind the development of the Skills Funding Agency and Young People’s Learning Agency, and the proper role of DIUS and DCSF for capital matters.
Each autumn, in its annual grant letter to the Learning and Skills Council (LSC), the Department for Innovation, Universities and Skills (DIUS) sets out the funding envelope for further education for the coming financial year. The grant letters published in October 2007 and November 2008 set out the planned investment for 2008-09 and 2009-10 respectively.
The publication of the grant letter starts the allocations process, which is led by the LSC. The LSC enter into a dialogue with colleges and providers, to determine their allocation based on expected delivery of both adult learner responsive and employer responsive provision.
This dialogue continues throughout the year, and during this time, the LSC and DIUS have regular discussions regarding the progress of the allocations process. Final allocations are made in the spring before the academic year to which they refer.