Directors at independent training providers are earning more than the highest-paid college leaders in the country, Tes analysis has revealed.
According to the most recent available accounts, seven of the largest 30 independent training providers in terms of their income from the Education and Skills Funding Agency paid at least one of their directors over £200,000 in salary alone, with almost all also paying pension contributions.
Those seven providers collectively paid £4.9 million to their directors in a single year, according to the figures.
With the expansion of the apprenticeship programme, training providers - which include private firms, as well as employer providers and not-for-profit and voluntary sector organisations - have increased in prominence. Accordingly, some of the largest received sizeable income from the ESFA in 2017-18.
BCTG Limited, which was graded “requires improvement” by Ofsted in 2016, received more than £17.7 million from the ESFA in 2017-18. Its most recent accounts, for the year up to the end of March 2017, state that £1,015,633 was paid to its highest-paid director. This was also the total amount paid to directors. However, the accounts stated that there were two directors working for the company that year.
Directors’ pay
Meanwhile, Kaplan Financial, a provider offering financial, accountancy and business training, received more than £15.6 million from the ESFA. It paid its highest paid director £481,000 in a year, according to its accounts up to December 2016, as well as £13,000 in pension contributions. The total remuneration package to directors that year was £579,000. The accounts stress that the figures “include amounts for services provided to other group companies”.
QA Limited, which offers training at 20 learning centres across the UK, paid £474,075 to its highest paid director in the year to June 2017, with a total remuneration package of £1,206,463 for directors. The accounts also reveal that two directors received contributions from the company to money-purchase pension schemes.
Learndirect, the UK’s biggest provider, which gained notoriety after being rated “inadequate” by Ofsted in August 2017, had an ESFA income for the year of £70 million, and paid over £700,000 to its directors in the 18 months leading up to January 2017, with £264,000 spent on its highest paid director alone.
Lifetime Training Group, Learning Curve Group and Ixion Holdings all also paid their directors significantly over £200,000 for a year.
Quality of providers
By comparison, the highest paid college principal in 2016-17 was Matt Hamnett, then principal of North Hertfordshire College, who was paid £294,000.
Robert Halfon, chair of the Commons Education Select Committee, said: “I have concerns about the quality of training provided by some subcontractors, and the public will want to be reassured that these training providers are delivering courses that are up to scratch.”
Jon Richards, head of education at support staff union Unison, said it was “outrageous these executives are being paid such vast sums while apprenticeship numbers are dropping”. “Some of the cash in their pay packets even comes direct from taxpayers,” he added. “Employers should boycott these training providers, and look instead to further education colleges to run apprenticeship courses.”
But an AELP spokesperson said that a comparison with college principals’ pay wasn’t “really appropriate, because a significant proportion of the large providers’ income comes from commercial training for employers, and these providers cover a whole range of business”. “It also has to be recognised that independent training providers must earn their government funding,” they added.
Highest paid director
A spokesperson for QA Group said the number quoted for its highest paid director was total emoluments, not just salary, and related to William Macpherson, group chief executive of QA Limited. They added: “William heads up the QA Group, which is comprised of four divisions. In the year in question, our apprenticeships division represented less than 15 per cent of our overall business.”
A spokesperson for Kaplan said: “We do not, as a matter of company policy and for privacy reasons, comment on employee compensation.”
BCTG said it was “unable to confirm” any details about pay, after a request to verify the pay of its top director.
Babcock declined to comment. Learndirect, Learning Curve Group, Lifetime Training and Ixion Holdings did not respond in time to requests for comments.
Highest paid directors at the biggest training providers
- BCTG Ltd: £1,015,633
- Kaplan Financial Ltd: £481,000
- QA Ltd: £474,075
- Lifetime Training Group Ltd: £281,074
- Learndirect Ltd: £264,000
- Learning Curve Group Ltd: £220,000
- Ixion Holdings (Contracts) Ltd: £209,130
- Babcock Training Ltd: £186,000
This is an edited version of an article in the 6 July edition of Tes. Subscribers can read the full story here. To subscribe, click here. To download the digital edition, Android users can click here and iOS users can click here. Tes magazine is available at all good newsagents
