Inspectors are acutely aware that the FE sector is “not in the best financial health”, according to Ofsted’s deputy director for FE and skills.

Paul Joyce told the Skills and Education Group’s annual conference in Nottingham that it was important for inspectors to bear in mind the realities in which the sector is operating.

“At Ofsted, both I and our inspection teams are very aware of the operating conditions within the FE and skills sector at the moment and the many challenges that you, as providers, face,” he said.

The inspectorate “certainly does not underestimate” challenges around funding. “We know that the sector isn’t in the best financial health and we know some providers are really struggling and have had to make some difficult decisions in terms of curriculum offer and for staffing.”

In December, chief inspector Amanda Spielman used Ofsted’s annual report to stress that the FE sector would continue to struggle without a higher base rate of funding.

‘Many challenges’ from apprenticeships

At today’s conference, Mr Joyce acknowledged that issues faced by providers were not purely financial. “There are many different policy initiatives and many changes that you are having to cope with as providers,” he added. “Again, we recognise that and we acknowledge that.”

Although the apprenticeship reform programme may “provide many opportunities”, Mr Joyce said it can also provide “many challenges” in terms of the procurement process, the move from frameworks to standards, the different relationship that is required with employers and different models of delivery.

He said that implementing T levels, as well as other reforms, will continue to “occupy senior managers’ time” as they try to ensure they are well prepared to adapt with changes.

Sector can be ‘proud’ of outcomes

But the state-of-the-nation picture for FE is “generally positive”, Mr Joyce said, as data from inspections of around 1,000 providers shows 82 per cent are either “good” or “outstanding” - the most up-to-date figure for colleges is 77 per cent. “This is something the sector can be proud of,” Joyce said.

He said the area for concern was that too many providers that had received full inspections so far this academic year had been found to be either “requires improvement” or “inadequate”.

Mr Joyce added: “Too many providers fail to improve from grade 3 or 4 and too many are slipping from grade 1 or 2. This needs to be addressed as a sector.”