The Department for Education (DfE) must ensure that university technical colleges (UTCs) offer value for money, according to a report from the Commons Public Accounts Committee released today. 

The influential committee of MPs has concluded that the “taxpayer is paying over the odds” for the 14-19 schools, which have been less than half full.   

The committee says that new targets for students’ success and financial measures are needed for UTCs, which have cost the DfE more than £700 million since they were created in 2010.

The MPs say a “lack of students has meant the department has been propping up the finances of UTCs for several years, and most of the extra funding will not be paid back”.

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As of January 2019, the 48 open UTCs were operating at 45 per cent capacity on average, while 10 of the original UTCs had already closed.

And more than half of UTCs were rated as less than “good” by Ofsted in October 2019.

The report also brands the “significant” role of the Baker Dearing Educational Trust in UTC programmes as an “unusual set-up”.

The trust is a charity founded by Lord Baker and Lord Dearing in 2009, which owns the UTC brand and issues licences to schools wishing to operate as UTCs.

“As well as receiving money from the department to support the opening of UTCs, the trust charges each school an annual licence fee,” the MPs note.

“We are concerned by the department’s apparent lack of interest in what UTCs are getting from using taxpayers’ money in this way.”

The report says that the trust received £893,000 to support the opening of the technical schools, and that the licence fees rose to £10,000 from every UTC in 2019-20.   

It says that the DfE has still not defined what success looks like for UTCs, and the DfE “regards student destinations as a better metric but has not adjusted its performance framework to reflect this view or to indicate how the success of UTCs should be judged”.

It also says the department is a long way from achieving the aims of its three-year plan, begun in 2017, to improve the financial performance of UTCs. 

And its three-year programme to improve UTCs’ performance for students, begun in September 2017, aims for the proportion of UTCs rated as “good” or “outstanding” by Ofsted to be the same as for free schools generally. But, as of August 2019, 52 per cent of UTCs inspected were rated as “good” or “outstanding”, compared with 84 per cent of free schools. 

The report also notes that, while data shows that a higher proportion of UTC students go into apprenticeships compared with other secondary schools, most of these apprenticeships are at a level equivalent to secondary school qualifications rather than any higher level.

The committee says the DfE should now:  

• Work with UTCs with higher occupancy levels to help UTCs that are struggling to attract students.  
• Set clear three-year financial targets for each UTC.  
• Within three months, explain in writing to the committee how it uses data on student destinations to track the performance of UTCs.  
• Work with UTCs to gain assurance about the value schools are getting from payments to the Baker Dearing Educational Trust, and submit its findings to the committee within three months. 

Meg Hillier, chair of the Commons Public Accounts Committee, said: “An awful lot of money has gone into this idea with good results alarmingly thin on the ground - although it’s very hard to tell when the [DfE] hasn’t managed in 10 years to say what a good result is.

“While the department determines what success is for the students already committed to a UTC education, it needs to look to the future and financial management of UTCs.  

“It is not fair to make this kind of alternative offer to students trying to equip themselves to make a living, and then not ensure that it delivers a sustainable, quality, recognised measure of success for them.

“For students in UTCs, it’s not an expensive if innovative experiment, it’s their future - more uncertain now than ever as we face what the chancellor has described as an unprecedented recession. The department must show us how it is going to make UTC education worthwhile - for students, their parents and the taxpayer.”

Nansi Ellis, assistant general secretary of the NEU teaching union, said: “This report vindicates the NEU’s longstanding concerns about UTCs. Significant resources have been ploughed into the programme despite serious flaws in the model and its poor record.

“The UTC model is clearly unsustainable. The Public Accounts Committee report shows 10 institutions have closed and those that remain open are operating at 45 per cent capacity on average.

“At the same time, public money has been syphoned off into the hands of the Baker Dearing Educational Trust, the private trust which owns the UTC brand. 

“It is simply wrong that a private trust has received substantial amounts of public money for what is apparently no discernible benefit. These financial arrangements with the trust should be cancelled immediately.”

A Baker Dearing Educational Trust spokesperson said: “As Baker Dearing was not invited to attend the PAC hearing, we were not in a position to articulate the vital role our charity fills in making the UTC programme a success.

“We achieve this by delivering hands-on educational, financial, student recruitment and [multi-academy trust] rebrokerage support for all UTCs, as well as fulfilling the central role of government liaison and raising the programme’s profile. Because Baker Dearing is not a multi-academy trust, the licence fee we receive from UTCs is the mechanism through which they pay for this support; in fact, UTCs suggested and approved the fee increase last year.

“We look forward to working with the DfE and UTCs in the coming months to demonstrate our charity’s value, as recommended by the PAC.”

The DfE has been contacted for comment.