The story that the £160m Phase 2 of the National Tutoring Programme (NTP 2.0) will go to Randstad and not the Education Endowment Foundation’s subsidiary the National Tutoring Foundation Ltd, was broken by Will Hazel in The i on 9 May. Kudos to Mr Hazel and it seems that the NTP will make a formal announcement later today after notifying their tutor partners (suppliers) via email on Sunday evening of an upcoming change in the NTP.
This is big news for schools, politics and those in the business of education (not just tutoring).
Since it was hastily launched, the NTP has been run by EEF, the government’s favourite education think tank. The closeness of EEF and their backers The Sutton Trust and Impetus, is such that the government gave £125m to found the EEF. These two organisations are also the lead partners for education in the government’s What Works network whose goal is to “share and use (or ‘generate, translate and adopt’) high quality evidence in decision-making”.
The fundamental questions are:
- Why did the EEF/NTF bid lose and Randstad win?
- What does it mean for the wider education community?
Being the incumbent provider and government favourite, EEF should have been odds-on to win the £160m NTP Phase 2, even though there was plenty of criticism of EEF from people like me because it was:
- Developed in a rush
- Used sketchy ‘evidence’ that did not meet EEF’s own standards
- Chose as major delivery partners several companies who didn’t actually provide tutoring
- Excluded the bulk of suppliers who serve the far larger £6bn private tuition market, seemingly on ideological rather than commercial grounds
- Gave schools a limited choice of providers whose offerings ranged from 1:1 in person to small groups online via hugely varied pedagogical and organisational approaches
What did the EEF do wrong?
Why, given their close relationship to the DfE/government and with access to some of the best legal and business brains in the UK, did the EEF decide to bid via a new entity, National Tutoring Foundation (NTF)? Pressure from the tutoring industry and media was ignored by EEF and government but the creation of NTF can surely only have happened after discussion with and the support of The Sutton Trust, EEF’s senior management team and Board, NESTA, TeachFirst, et al.
NTF is a company not a charity, albeit one without shareholders. Their Articles of Association set out as their core Objects (3.1), ‘the advancement of education for the benefit of the public, in particular but not exclusively by improving access to tutoring and academic mentoring to improve the life opportunities and address low educational attainment and disadvantaged children and young people in particular’.
5.1 The property and funds of the Charity must be used only for promoting the Objects and not belong to the Members of the Trustee’.
Note the word charity as this could be the landmine that blew up the NTF bid, but more about that later!
Charity vs company
Under the Companies Act 2006 you can be a limited company, use the word Foundation in your name, have exactly this sort of remit but as a commercial company. The Education Foundation Ltd (EFL), who until recently ran the DfE’s Edtech Demonstrator Program, are similar, but companies must also commit to using their assets and profits to meet their objectives. EFL’s Articles state this very clearly under Limitation of Private Benefit. 4.1 The Company is not established or conducted for private gain:any profits or assets shall be applied to the promotion of its objects for public benefit’. Now as far as I can tell the NTF was never registered as a Community Interest Company (with The Office of the Regulator of Community Interest Companies) nor was the EEF listed as a related asset-locked body (this law is arcane as a CIC, charity and Industrial Provident Society can all be asset-locked, which is where the assets go if they fail).
This tender process was not undertaken in a vacuum and the DfE and government will have spent time talking to EEF about NTP 2.0 during which time EEF decided to bid not itself but via the NTF, announced on 23 Mar 2020. EEF’s media release said they were, ‘supporting the creation of a new, independent charity to compete for the contract to deliver the National Tutoring Programme in the next school year’.
To my mind, it was from there on that they started making a fatal mistake. A company is legally not a charity however a charity can be a company. In theory they can function similarly, but are regulated by different laws and bodies throughout the UK. A good example of the difference is that Gift Aid, which can be claimed by charities, can’t be claimed by companies no matter what their purpose (a company can claim Corporate Gift Aid by setting this against any profits). To add complexity registered charities can also be companies almost identical to the NTP, the wrinkle being the NTP isn’t a registered charity (in England, Scotland or Northern Ireland)
This all comes back to NTF Ltd’s Articles of Association (registered ironically on April Fools Day) that start out as follows:
CERTIFICATE OF INCORPORATION
PRIVATE LIMITED COMPANY
Company Number 13309327
The Registrar of Companies for England and Wales, hereby certifies that
NATIONAL TUTORING FOUNDATION
is this day incorporated under the Companies Act 2006 as a private company, that the company is limited by guarantee, and the situation of its registered office is in England and Wales.
The office address is listed as at Stone King LLP‘s London office (they are a leading law firm who specialise in charities, education and social enterprise).
Next come the lists of the NTF’s directors:
- Graham Elton
- Christine Gilbert
- Dr Becky Francis (CEO EEF)
- Sonia Thompson (Headteacher)
Standard stuff until you get to page 11, where the detail starts and the confusion begins.
1.1 The name of the company is the National Tutoring Foundation (the “Charity”) or such name as shall be stated in any certificate of incorporation on change of name for the Charity issued by Companies House from time to time.
3.1 The objects of the charity are the advancement of education for the benefit of the public, in particular but not exclusively by improving access to tutoring and academic mentoring to improve the life opportunities and address low educational attainment of disadvantaged children and young people in particular.
3.2 Nothing in these Articles shall authorise and applications of the property of the Charity for purposes that are not charitable in accordance with section 7 of the Charities and Trustees Investment (Scotland ) Act 2005 and /or section 2 of the Charities Act (Northern Ireland) 2008.
Key words are defined on page 23:
17.4 In these Articles:
“Act” means the Companies Act as defined in section 2 of the Companies Act 2006, in as far as they apply to the Charity.
“The Charities Act” means the Charities Act 2011
The word Charity is not itself defined. It reads like it was cut and pasted from a charity document and cobbled together with one for a Limited Company, then registered with Companies House. I may be wrong in my interpretation but if you’d like to check you can read it here.
Why else might NTF/EEF have lost the tender?
The answer lies in the procurement process. Creating a new body to bid for a £160m public contract is unusual, except where it is the subsidiary or a JV including more established entities. Government procurement is complex and to protect the public purse there are loads of regulations that can/should provide checks and balances. During Covid, emergency legislation allowed procurement processes outside the usual standards. While this arguably happened with NTP 1.0, it did not for NTP 2.0 as there was a formal system that included publication of a Prior Information Notice (PIN) and at least two documents for the actual tender. Anyone can see bits of these on tender systems like TenderLake, although the real detail and complexity come as any applicants have to use the DfE’s byzantine Jaggaer e-procurement system (jaggaer.com acquired in 2019 for £1.06bn by UK private equity firm Cinven). Unfortunately, even as a registered user I couldn’t see much detail but it does clearly state in the Contract Notice issued on 25 Feb, that price is not the only award criterion (II 2.5 Awards Criteria) and all criteria are stated only in the procurement documents (not publicly available). It also notes, “Tenderers must pass standard Mandatory and Discretionary Exclusion Criteria as set out in the Standard Selection Questionnaire and have sufficiently robust Financial Standing”.
New entities like NTF don’t have the minimum two years of audited accounts, references from prior (similar) projects, good credit reference scores and the like. Normally NTF would fall before the first jump, but buried in the raft of government procurement rules are opt outs for new entities, particularly ones with not-for-profit community/social benefit aims, just like NTF. Things got even simpler and faster as a result of Covid with Procurement Policy Note 01/20: Responding to COVID-19 In these exceptional circumstances, authorities may need to procure goods, services and works with extreme urgency. Authorities are permitted to do this using regulation 32(2)(c) under the Public Contract Regulations 2015.
This means the government and DfE didn’t really even have to go through a formal tender process. Given they politically and electorally have survived the stink of scandals like £22bn on the failed Contract Tracing and even larger amounts of PPE, why bother for £160m of their £1.3bn education catch up fund?
The answer may be that the runes of edu procurement had already been shifting. Both examples track back to United Learning (UL), one of the largest Multi-Academy Trusts (MAT) in England. In 2019, UL put out a tender for an edtech platform to supply 57 of its schools with a cloud-based MIS. From a shortlist of two, the contract was awarded to Arbour Education and as a result in 2020 Bromcom sued UL claiming breaches of Public Contract Regulations 2015. UL then sought to have the claim struck out, but in January 2021 most (but not all) of their defence was rejected by Judge Eyre QC in the High Court. A potential supplier suing a MAT over a £2m contract seems an unusual strategy in such a niche market, particularly as a SchoolsWeek story says the legal costs for each party could top £250k (or £500k of a £2m deal, far more than any supplier’s margin).
Next came UL’s success in bidding to provide the £885k DfE’s Edtech Demonstrator Schools Programme, formerly run by The Education Foundation Ltd (EFL), London Grid for Learning and Sheffield Hallam University. This has also caused a stir as UL were already part of the program and will be responsible for distributing £5.5m to the 44 schools in the network including its own. This has led to conflict of interest claims and replies that the government will put in place robust governance procedures including an independent audit, to avoid any potential conflicts of interest. The complaints about UL’s win have come most strongly from EFL, a very reputable entity who I think probably did a good job with the Edtech Demonstrator program and a better one than the EEF managed with the far larger NTP. However, my view is that the DfE have a different, more stringent attitude towards procurement risk and an aversion to getting involved in litigation. This seems to have raised the bar in terms of financial and operational capacity/experience for those bidding for contracts like NTP, particularly related to Procurement Policy Note (PPN) 02/13 that focuses on supplier financial risk. The new NTF I don’t think could not meet these requirements.
The National Tutoring Programme has significantly undershot its targets and most of the blame lies with their ideology trumps experience culture, use of weak data to shape the NTP and poor selection of suppliers, with some of the largest allocations going to companies who are really nothing more than teacher supply agencies. The outcome of this large failure should also lead to changes at EEF both organisationally, ideologically and especially amongst their Boards (executive and advisory) and SMT.
I hope Randstad, who have vastly more experience and less ideological and political baggage, will do a better job running NTP 2.0. Whether they can be both an NTP supplier and manager of the programme throws up similar conflict challenges to those faced by UL, but these are not insuperable. What they will need to do urgently is:
- speed up the rollout of NTP 2.0
- reform the supply chain (or ‘develop the market’ as the tender stipulated)
– to include quality experienced providers from the larger mainstream tutoring sector
– change the allocations of existing suppliers giving more to those who have demonstrated quality provision and the opposite to those that are underperforming
- Act decisively and support the best suppliers who, if they are to help achieve NTP’s targets, will need to invest in doing so, regardless of whether they are for-profit or charitable.
I shall watch with interest.
Disclaimer – I am an investor in a tutoring company, but one which has no involvement with the NRP and which I am led to believe has no desire ever to do so.