The UK adult education sector has seen a significant underspend of nearly £300 million over the past four years, due to shifts in learner demands and changing work trends.
Recent figures reveal that the adult education budget underspends in non-devolved areas representing between 7 and 16 percent of the total available budget annually.
This repeated underspend reflects the ongoing impact of post-pandemic shifts and indicates a need for strategic reforms in adult learning and training allocations.
The largest funding shortfall, amounting to £115 million, occurred in the 2021-22 period. Over the past two academic years, underspends totaled £80 million and £43 million respectively, bringing the overall budget underspend to £292 million out of an allocated £2.6 billion from 2020-2024.
Typically, these unspent funds are returned to the Treasury, raising concerns about the current funding model and adult education spending.
Alex Ford, CEO of CT Skills—one of 55 independent training providers (ITPs) that secured contracts in the recent adult education budget (AEB) allocation—believes that post-pandemic shifts in learner needs contributed to the underspend.
As employment levels surged post-COVID, adult learners increasingly demanded flexible, modular learning options instead of longer, classroom-based programs. These shorter programs draw down less funding, leaving a portion of the budget unspent each year.
The Department for Education (DfE) has not provided specific reasons for the adult education underspend, but longstanding issues related to “complexity and underfunding” in adult learning budgets have been acknowledged by Julian Gravatt, Deputy CEO at the Association of Colleges. Additionally, COVID-related shifts to online learning deepened the underspend in both the 2019-20 and 2020-21 academic years.
In the 2023-24 financial year, independent training providers received only £75 million from the adult skills fund, with the remainder of the budget going to grant-funded colleges.
A government cap limiting subcontracting to 25 percent has restricted many colleges’ abilities to collaborate effectively with other training partners, further contributing to the unspent budget.
Brenda McLeish, CEO of Learning Curve Group, expressed disappointment over the underspend, especially as her organisation faced difficulties securing an AEB contract in recent DfE tenders.
She criticised the DfE’s decision to re-contract providers that had previously under-delivered, while experienced, proven providers were overlooked.
Skills consultant Aidan Relf has called for a comprehensive reform in adult education funding. He argues that the Treasury is likely to question why the sector consistently underspends its allocated funds, despite the recognised need for adult learning and upskilling programs.
Relf supports a reallocation model, including the potential reintroduction of individual learning accounts, as previously recommended by the Blunkett skills commission.
The persistent underspend in adult education underscores the need for flexibility and reform in adult education funding.
As the UK job market evolves, aligning the adult education budget with learner needs will be essential to supporting upskilling and lifelong learning in a post-pandemic world.
