The Rt Hon Jeremy Hunt MP

Chancellor of the Exchequer

1 Horse Guards Road

London

SW1A 2HQ

27^th February 2024

Dear Chancellor,

RE: Supporting our further education sector

Ahead of the spring budget, I am writing to draw your attention to the contribution made by our further education sector and the need to fund it adequately.

My constituency is home to The Sheffield College, the largest further education college in South Yorkshire. It plays a vital role in the city and wider region, enabling individuals, communities and employers to gain the skills required to advance opportunities, contribute to social cohesion and inclusivity, and increase productivity. It provides academic, vocational, and professional qualifications to approximately 13,000 young people and adults a year and works with over 2,000 employers.

As you know, the skills shortage means that over a third of all vacancies are skills-shortage vacancies and over 5% of the workforce has a skills gap. These figures demonstrate the urgent need to properly invest in the skills which will get our economy growing again after years of flatlining economic performance.

We will only be able to overcome these hurdles with a thriving further education sector. But at present, funding is not matching the ambition of our hard-working colleges. Spending per college student is now 5% below 2010 levels.

The impact of these cuts is clear to see. The number of adults participating in some form of learning has collapsed to only one in three, the lowest level for 22 years. The opportunity to reverse these trends must be taken in the upcoming budget.

Since 2022, colleges in England have been classified as public sector organisations. However, unlike 10,000 other public sector organisations, they are unable to reclaim VAT costs under Section 33 of the refund scheme. The impact of this VAT burden is that students in colleges have less resources spent on them than their peers in school sixth forms.

Adding to the pressures on the sector is that the pay gap between school teachers and college lecturers is stark. The median pay of further education teaching staff is 22% below school teacher pay; this inevitably has an impact on the ability of colleges to recruit and retain staff.

Colleges provide invaluable opportunities to people of all ages to train, retrain and upskill for both the jobs of today and the jobs of the future. As new technologies emerge, the skills gap will only get worse unless action is taken to turn the tide.

I urge you to provide the further education sector the resources it needs to thrive.

Yours sincerely,

Gill Furniss MP

Member of Parliament for Sheffield Brightside and Hillsborough