16 to 19 funding: how the formula actually works

16 to 19 students are funded for the programme they are on, not for each qualification.

The calculation takes how many students you have, multiplies by a rate that depends on how many hours they are doing, then adjusts for how many finished, what subjects they studied, and the circumstances of the students and the area.

• Student numbers: how many, from an earlier year's return.
• Band rate: which hours band each student falls into.
• Retention: how many completed their main aim.
• Programme cost weighting: some subjects cost more to teach.
• Uplifts: disadvantage and area cost.

Three of those elements are driven directly by your own data. The band comes from planned hours you record. Retention comes from withdrawals you record. Disadvantage comes substantially from home postcodes you record.

That is the useful insight for a leader: most of the 16 to 19 formula is not something that happens to the college, it is something the college's own data decides.

Provision runs under ILR funding model 25. The formula combines student numbers, the national funding rate for the student's band, the retention factor, programme cost weighting and the formula-protected uplifts including disadvantage and area cost.

Band thresholds, national funding rates, the full-time hours figure and the uplift factors are all set annually in the rates and formula document for the funding year. Take every figure from that document.

16 to 19 funding is lagged. The allocation for a year is worked out from student numbers returned in an earlier year.

So recruiting more students this year does not bring in more money this year. It affects next year.

This is the most consequential thing for a leader new to further education to understand, and it is counter-intuitive coming from almost any other sector.

It also means the December return is where next year's income is effectively decided. Everything that makes that return accurate is worth doing, and nothing done later can undo it.

The allocation methodology for the funding year is published with the rates and formula documentation. Reconciling the allocation statement back to the return it was built from is the check that catches an error before it becomes a budget.

In-year growth arrangements, where available, are the only route by which current-year delivery affects current-year income, and are subject to the arrangements for the year.

Students who have not achieved a qualifying grade in English or maths have to keep studying the subject as part of their programme.

If they do not, the funding for that student can be reduced.

The requirement is about continued study, and it has to be recorded. A student who is studying the subject but whose record does not show it is treated the same as one who is not.

Exemptions exist. Which grades qualify, which qualifications count and which exemptions apply are all set out in the funding rules for the year and do change.

Check the funding rules for the funding year for the qualifying grades, acceptable qualifications and exemption categories. Record the position on the ILR for every affected student.

A pre-return check comparing students with a qualifying prior attainment position against those with a recorded English or maths aim is the standard control.