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Analysis · Latest · 20 September 2026

Removal of Funding Approval for Level 2 and 3 Qualifications

Public funding approval for new 16 to 19 student starts will be removed from 1 August 2027.

Funding yearNot tied to a funding yearVerified currentReviewed20 September 2026See the sourcesReport an issue
Removal of Funding Approval for Level 2 and 3 Qualifications — FE Funding

What changed

Public funding approval will be removed for new 16 to 19 student starts from 1 August 2027.

Who is affected

FEFunding analysis. Our reading of the official requirement, not the requirement itself.Colleges offering Level 2 and 3 qualifications to 16 to 19 students will be directly affected.

What colleges need to do

Colleges should review their Level 2 and 3 qualification offerings and prepare to adjust their curriculum plans for 2027–28 accordingly.

Funding impact

FEFunding analysis. Our reading of the official requirement, not the requirement itself.This change may lead to a reduction in funding for colleges that rely on new Level 2 and 3 student starts.

MIS and ILR impact

FEFunding analysis. Our reading of the official requirement, not the requirement itself.Colleges will need to ensure that ILR returns reflect the removal of these qualifications starting in the 2027–28 funding year.

Compliance impact

FEFunding analysis. Our reading of the official requirement, not the requirement itself.Auditors will examine compliance with the funding approval changes, focusing on the reporting of student starts in Level 2 and 3 qualifications.

Important dates

Funding approval removal takes effect from 1 August 2027.

Previous and current position

FEFunding analysis. Our reading of the official requirement, not the requirement itself.Previously, Level 2 and 3 qualifications had funding approval for new 16 to 19 starts; this will change in 2027.

Official evidence

For more information, refer to the official document on the GOV.UK website.

What changed is taken from the official evidence listed below. Everything marked as FE Funding analysis is our reading of it. Confirm anything you are about to act on against the source itself.

Official evidence

Put this into practice

Model the numbers in the calculator, or ask FundingGPT how it applies to your college.

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