Strategic Rationale for Subcontracting

Introduction

South West Association of Training Providers Ltd (Swatpro) was formed in 2011 as a partnership of employers and training providers to provide an effective, not-for-profit, efficient, and cost-effective training provider partnership supporting employers and learners predominantly, but not exclusively within the South West. The partnership came together initially to respond to the minimum contract levels introduced from the Skills Funding Agency; enabling providers with smaller valued contracts to come together to continue to provide access to further and higher education and permanent employment. The not-for-profit approach, low service fee and surplus distribution into learning is seen as a sound working model. The partnership offers 16-18 and adult traineeships, adult skills, apprenticeships, and advanced learner loans.

Providing high quality learning, skills and information, advice and guidance solutions for learners, employers and communities that are healthy and safe, provide equality of access and achievement and deliver value for money which is at the Centre of the Swatpro mission. The delivery model is flexible to meet the learner and employer needs and add the value identified by the employer to the business. The Swatpro model meets these aims,

enhance the opportunities available to young people and adults
fill gaps in niche or expert provision, or provide better access to training facilities by providing a cost - effective shared resource approach
support better geographical access for learners
Provides a platform for a peer-to-peer shared approach for resources, knowledge, and best practice

Success is achieved by the service being delivered by a professional dedicated team that has a strong and successful background in the sector and has the required skills in performance management, contract management, project management and quality improvement. Robust performance and quality management processes and practice are deployed to ensure the organisation’s KPI’s are met and continuous improvement is achieved.

The company has a unique pedigree as it is a not-for-profit company limited by guarantee with its membership being established employers and providers approved on the Education and Skills Funding Agency (ESFA) Register of Apprenticeship Training Providers (RoATP) and Register of Training Organisations (ROTO) with a history of delivering high quality learning and skills. In addition, the company is aligned to the provider networks in the region offering partnership opportunities where appropriate with other colleges and providers and the essential relationship and track record with LEP’s, Local Authorities and the community.

The membership level is not prescriptive or exhaustive, new members can join the company dependent upon robust due diligence suitable to the sector and the communities need for the provision. The company may also seek new members or partners to meet a proven need within a community, respond to local or National policy or support the operation or delivery of members.

The company finance model is clear cut. Swatpro retains a small percentage of the overall funding to provide essential and support services and distributes the remainder to partners. The retained funds cover the costs of Swatpro delivering appropriate learning, the lead provider responsibilities and funds the cross-partnership developments planned. Any surplus is passed on to the subcontractors for learning and skills or used to implement investment in resources or facilities to improve the delivery of education and training or fund a cross partnership development agreed by the board. The opportunity can arise to reduce the retained funding level as the Swatpro partnership grows as costs would not grow in proportion with the addition of partners, allowing more funding to flow to partner providers for the provision of learning and skills. The retained funding level in 2018-19 was 10%, reducing to 8.7% after surplus distribution and to 9% in 2019/20.

Swatpro is uniquely qualified to deliver to the target market and meet the aspirations set by local plans and priorities as it has a wealth of expertise drawn from a wide variety of already successful employer and provider organisations. This matched with the ability of the partnership to gain from the benefits offered by joint working, common strategy, shared services, increased buying power, shared resources and increased efficiencies puts Swatpro able to deliver a strong and successful provision with accurate and robust contract management.

Swatpro considers the model to be high value and low risk that adds benefit to employers and learners and does not deserve to be pigeon-holed with many subcontracting models that are the opposite.

A quote from the latest Ofsted inspection:

“Subcontractors benefit from working closely with managers at the South West Association of Training Providers (SWATPro) and share good practice that improves learners’ achievements”.

Is the Swatpro model subcontracting? That is debateable as the company is limited by guarantee whose members are the employers and providers engaging with the model and who are Swatpro by legal definition.

It is a fact that funds are passed to separate legal entities through the financial process, the definition of subcontracting defined in the ESFA Funding Rules, Swatpro is compliant with the rules and act as if subcontracting due to this rule.

Swatpro works with partners and not subcontractors, this is important as a defining factor of the model is that the partners are invested in the model, have a say in its operation and strategy and consider themselves Swatpro, not an at arms-length temporary, convenient subcontractor.

South West Association of Training Providers Ltd - Membership
Member organisation	Employer or provider
North Bristol NHS Trust	Employer
Puffins Ltd	Employer
Royal Devon and Exeter Hospital	Employer
Train4all	Independent Training Provider
Varsity Training Ltd	Independent Training Provider
Wessex Training and Learning Ltd	Independent Training Provider
White Horse Training Ltd	Employer owned training consortium
Working Knowledge Ltd	Independent Training Provider

To download this infographic, please click this link.

Subcontractor testimonials – in their own words

North Bristol NHS Trust (NBT) has been a member of Swatpro since 2011. As an organisation we deliver apprenticeships, traineeships and AEB funded programmes mainly to our own staff. In 2019 we secured Main Provider status, however, have found the most viable and cost-effective way to deliver provision is through our close working relationship with Swatpro.

NBT’s relationship with Swatpro is one that is built upon a mutual understanding and respect. The Swatpro team are able to provide expert advice in all areas including quality, governance, business development and compliance. Without this relationship NBT would need to employ this expertise, at a cost which would be significantly higher than the management fee that is currently paid. NBT therefore feels that this represents good value for public money and without this support we currently would be unable to deliver provision to our staff in a compliant way.

Through being a partner of Swatpro we have been able to establish even closer working relationships with similar providers to ourselves (Varsity Training & Royal Devon and Exeter NHS Trust). This sharing of best practice has enabled NBT to improve its delivery provision, which in turn has led to better outcomes for our learners.

Whilst on paper NBT is a subcontractor for Swatpro, in practice the day-to-day working relationship is so very different than this. We are a partner and can only efficiently do what we do through our partnership.

Jonathan Hall,
Non-Medical Education Manager
Learning & Development
North Bristol NHS Trust

“As an employer, the vast majority of our recruitment is via apprenticeship schemes. It is very important to us that we use a small, specialised local training provider that can respond quickly to our training needs and that can work with us to develop a bespoke programme that equips our apprentices with the skills and knowledge that they need to be great employees. When considering how our training should be delivered, we wanted a solution where as much as possible of our contribution, and government funding, was spent directly on the apprenticeship programme. A sub-contractor with SWATPro has a management charge that is far lower than the costs that would be required to be a lead provider, and has the additional benefits of economies of scale, shared resources, access to a more extensive knowledge base and, crucially, oversight by the board of Swatpro to ensure that the training provider is working within the funding rules and delivering a quality programme.”

Gillian Fawcett Managing Director Puffins Ltd

White Horse has been a partner in the South West Association of Training Providers since 2012, having joined following the introduction of minimum contract value. A long-standing specialist training provider who had previously held our own funding contract, we have stayed with Swatpro ever since, largely because of the help and support they provide in all areas of apprenticeship training, including quality assurance, compliance and time-consuming elements of administration. In addition to this, they represent the partnership with external bodies and also offer all partners, who are diverse organisations, unparalleled opportunities to share good practice and to support each other.

White Horse joined Swatpro as an experienced provider but has still found real value in the partnership. For new providers the expertise and support given is invaluable. This is a model for training which has proven to be successful, provides excellent value for money and improves the quality of provision in many areas. We believe that working in partnership in this way is a model which should be actively promoted with a view to it being adopted more widely.

Mrs Nicola Bevan – Managing Director White Horse Training Ltd

The Royal Devon and Exeter (RD&E) NHS Foundation Trust is a large organisation offering acute and community services and we became a SWATPRO partner nearly 5 years ago. We are a large employer of over 9,000 staff. Our experience as one would expect is predominately in delivery of healthcare services though we are also an accredited training provider for clinical level 3 and level 5 apprenticeships.

We have gained a number of benefits from being in the SWATPRO family, as some would describe subcontracting. These benefits include but are not limited to:

Having a network to enable sharing of good practice back into the organisation. Without this shared network, our understanding would be informed purely by healthcare networks, strategically this partnership enables us to network / engage with other sectors and learn from their extensive experience.
It makes good business sense financially to be in a partnership such as SWATPRO for the access and opportunities it affords us e.g., shared resources such as PICS and BKSB and also financially in terms of opportunities e.g. Matrix accreditation, procurement. Without it we would need to employ staff to undertake the activity that SWATPRO does on our behalf so being in this partnership is actually saving money which can be spent on healthcare. Having access to an experienced central team acting on our behalf saves us valuable time. It ensures we are correctly following funding rules and guidance.
Personally, being in partnership with SWATPRO feels it mitigates our risks associated with apprenticeship delivery as we aren’t experts in the world of education and funding. This means we can be assured our apprentices are receiving the best possible learning experience and opportunity and that is really important to us. The central SWATPRO team are great in horizon scanning, informing us of changes in funding rules, regulations and expectations relating to the world of apprenticeships that we don’t always have the time to do.
Lastly the model has been criticised by some but as an NHS Foundation Trust we do have to be cautious in who we enter into partnerships with. Given the above and in addition acknowledging that SWATPROs ethos is not for profit status, our engagement in the SWATPRO partnership means our decision to subcontract is not driven by commercial thinking, it is the value it brings to our organisation and therefore our learners as described above. That is why we choose to be part of the SWATPRO model.

Alison Copp Head of Professional Development, Royal Devon & Exeter NHS Foundation Trust

Channel Training provides Apprenticeships and Professional Development courses for the outdoor education and recreation sector. The sector is small, with many charitable, non-profit or other social enterprise organisations and with a predominance of small and medium businesses. The service that we are able to provide for employers in our world is significantly enhanced by the Swatpro model.

Having been listed on RoATP as a main provider, Channel has actively chosen to work within the Swatpro model because of the clear benefits it brings to our business and, in turn, to the employers and learners we support. It doesn't feel like sub-contracting. Why? Because, ironically, any commercial benefit works in a way contrary to expectation. It's not for the commercial benefit of Swatpro (a non-profit company) - it is the partner organisations like Channel that feel it, creating operational efficiencies, enabling shared expertise and resources and adding value to quality improvement processes. We are able to pass these benefits on to the learners and employers we support. We are able to offer the agility, expertise and careful customer service that comes from a small, specialist training provider with the security and support that comes from the large lead presence of Swatpro. Employer feedback tells us that this works - and we plan to maintain and develop the relationship as far as we can for this reason.

Jim Whittaker Managing Director Channel Group

WTAL is a small independent training provider within the Early Years sector and based in Dorset.

The need to be part of a bigger organisation and subcontractor became apparent. Various models were looked at, but South West Association of Training Providers (SWATPro) was the preferred organisation.

SWATPro suits the needs of the company and offers a network of similar minded, non-competitive, training providers. Companies who are passionate about supporting young people to fulfil their potential within the Apprenticeship route. With access to the expertise and knowledge within the main team at SWATPro; the availability of joint resources (BKSB and SAVVY) and joint buying power (MATRIX); training opportunities; sharing of good practice only strengthens and improves the quality of what is offered by WTAL.

Being part of the Management board allows me to have a voice in the discussions and decision-making process. Networking within SWATPro – Safeguarding and Quality groups – keeps WTAL up to date with trends and changes. This is then disseminated to my team. The MIS system (PICS) alone is part of the shared resources which, from my point of view, provides value for money as this would have been a large outlay were it not for SWATPro.

The quality visits monitor the company by auditing the evidence that is held within the office and checks that the Apprentice funds are spent appropriately. It has driven up the quality of the provision which is seen in the achievement and retention rates. Clear guidance and advice given when needed manages and enhances the Apprentice journey and provides us with a path for continuous improvement. Making effective and cost-effective changes improves performance across the board.

Being a sub-contractor allowed us to offer the Apprenticeship funding route within Early Years. As I am the owner of WTAL, at times, it can be a lonely position. By having SWATPro and the team there for support and guidance has meant a lot, the support immeasurable and extremely worthwhile.

Lynn Croucher
CEO

We, at Hudson Training have found many significant benefits from our working relationship with SWATPRO. The collaborative working arrangement between the SWATPRO partners brings a multitude of advantages to learners, employers and the trainings organisations involved.

Our organisation provides a limited but highly skilled and specialist service to providers of adult health and social care in South West England. Many of the difficulties associated with limiting our service to one specific sector and the rural geographical area we operate in are overcome as a direct result of our relationship with SWATPRO. An example of one such benefit is the provision of economies of scale resulting in maximising the amount of funding reaching frontline delivery. Our experience as a previous direct contract holder and lead provider with the ESFA leads us to conclude that the SWATPRO model and shared resources provides better value for money and is much more cost effective, resulting in significant benefits for learners and their employers.

The not-for-profit model of SWATPRO provides extremely strong governance and creates an environment where decisions need not always be driven by commercial thinking. Having one organisation managing many of the administration functions for the SWATPRO partners provides excellent value for money and a shared drive towards constant improvement. Governance, quality of delivery, curriculum and course planning all benefit from this model compared again to our past experiences as direct contract holders.

Neil Young
CEO

Approved by the Board and signed:

Craig Marshall
Non – Executive Director

Rodney Davis
Executive Director