The National College of High Speed Rail (NCHSR) struggled to fill student places in its first academic year and faces a £7.5m funding shortfall, Construction News can reveal.
The NCHSR opened two campuses in Birmingham and Doncaster 12 months ago to train a new generation of engineers to work on the £55.7bn HS2 line.
Both colleges were built to hold 1,600 students each.
However, the NCHSR had just 47 learners on its books across both the Doncaster and Birmingham sites at the start of its 2017/18 academic year, according to minutes from a board meeting in October 2017.
This increased to 93 students in February 2018 but fell back to 89 in July 2018.
NCHSR commercial finance director Martin Owen said the college was “encouraged” to have had more than 1,000 applications for places so far and was “fully confident of reaching our target of 400 learners over the 2018/19 year and 1,000 new learners in 2021/22 as the requirement for workers for HS2 grows”.
“Being a start-up […] is both a curse and a blessing,” he said.
“Clearly we want to open our doors and get to full capacity straight off. You’re never going to do that.
“But we’re in start-up mode, so the number of learners we’ve got are obviously going to [be] fewer.”
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Lucy Alderson investigates the funding and student shortfalls that have raised questions about the college’s viability.
He added that total apprenticeship starts across all industries had fallen by almost 39 per cent since the apprenticeship levy was introduced in May 2017, and that the past year has been “one of the most challenging periods on record” for further education providers as a result.
In the same board meeting held in February this year, the NCHSR also reported that it was facing a £7.5m funding shortfall over the next seven years.
It had budgeted to receive £29,000 of funding per apprentice in its business plan created in 2014.
However, the system in place for approving and allocating funding for apprenticeships was replaced upon the creation of the Institute for Apprenticeships in 2017.
A different procedure was put in place that capped funding at £27,000 per apprentice. Furthermore, the IfA decided to awarded the NCHSR just £21,000 for each apprentice – £8,000 less than originally budgeted for.
Mr Owen described the IfA’s decision as a “kick in the teeth” that left the college unclear as to why the IfA decided to put its apprenticeships in a lower funding band.
“The top funding band is for £27,000, which is typically for higher vocational technical engineers […] but this is exactly the sort of training we deliver,” Mr Owen said.
He added: “The IfA’s recent track record is that it keeps lowering and lowering funding bands. Personally, I don’t know to what end.”
The college’s trailblazer group (employers / trade organisations / professional bodies in charge of creating the NCHSR’s apprenticeship scheme) challenged the IfA’s funding decision at the end of September.
Mr Owen said the college expected to hear the outcome of the challenge imminently.
The National College for High Speed was the brainchild of the coalition government, which announced in 2014 that it would create five new national colleges with the aim of boosting skills in five industries.
These industries were: high-speed rail, nuclear, onshore oil and gas, digital skills and the creative industries.
Willmott Dixon won the £52m contract to build the two NCHSR campuses in Birmingham and Doncaster through the Scape National Major Works framework.
Yesterday, Philip Hammond announced in a speech made at the Conservative Party Conference that employers will be able to use 25 per cent of their apprenticeship levy funds on people working for businesses in their supply chain.
Mr Hammond said this was in response to “concerns about how the apprenticeship levy is working,” and the increased flexibility will be funded by a £90m cash injection from government.