Sub-contract Management Fee Policy 2017/18


This policy applies to all supply chain activity supported with funds supplied by the Education and Skills Funding Agency or any successor organisations.  This policy replaces any previous versions, where applicable, since coming into effect on 1st August 2013.


The content of this policy has been developed in line with AoC/AELP Common Accord, the ESFA Funding rules and the LSIS Supply Chain Management document.


PTP operates as a Main Provider and will use its supply chains to optimise the impact and effectiveness of service delivery to the end user.  PTP will therefore ensure that:

  • Our supply chain management activities are guided by the principles given in the LSIS publication “Supply Chain Management – A good practice guide for the post-16 skills sector” (December 2012).
  • At all times undertake fair and transparent procurement activities, ensuring that all potential subcontractors undergo a comprehensive due diligence to ensure that the highest quality of learning delivery is made available, demonstrating value for money, employer responsiveness, local skills priorities and positive impact on learner lives.
  • The funding that is retained by us will be related to the costs of the services provided.  These services, and the levels of funding being retained for them, will be clearly documented and agreed by all parties.


PTP engages with subcontractors to meet customer needs.  Reasons are varied but could be:

  • To expand provision to meet customer needs, with a wider portfolio of options available to the customer based on combined delivery services.
  • To provide immediate provision whilst expanding direct capacity. This might include working with subcontractors to explore and learn about new frameworks, standards or sectors prior to investment in resources.
  • Providing access to, or engagement with, a new range of customers.
  • To continuously improve the standard of delivery to customers by sharing best practice with other providers to improve quality.
  • To provide niche delivery where the cost of developing direct delivery would be inappropriate.
  • To support employers with a wide geographic requirement.


Subcontracted activity is a fundamental part of PTP’s provision. The quality of the provision will be monitored and managed through our existing IQA processes and procedures.  This policy positions subcontracted provision as a core part of our activity to enable continuous improvements in the quality of teaching and learning for both PTP and its subcontractors. This will be achieved through the sharing of effective practice across the supply chain, for example through the Self Assessment Report process.


In compliance with the Education and Skills Funding Agency and other agency funding rules that apply, PTP will publish its current subcontracting fees and charges policy and actual end-of-year subcontracting fees and charges on its website.  This will only relate to full provision subcontracting and will not include the delivery of a service as part of the delivery of a programme (for example, buying the delivery of part of an Apprenticeship framework or outreach support).

PTP will ensure all actual and potential subcontractors have sight of this policy and any other relevant documents.


The typical percentage retained to manage subcontractors is between 15% and 20% of all funding drawn down against the provision delivered. Each subcontractor’s performance will be measured during a contractual year against a set of performance criteria, as detailed in the Subcontract Agreement, which will determine the management fee set for the subsequent 6 months.  The management fee will be reviewed in January each year and agreed accordingly.

This figure represents the total cost that PTP incurs in effectively identifying, selecting and managing all subcontracted provision.  Subcontractors are supported by their own dedicated Supply Chain Manager and Business Support administration team.  PTP evaluates, monitors and where necessary sets targets for improvement, providing guidance, training and sharing good practice across the partnership to improve delivery to our customers.

Our comprehensive programme of support and compliance measures ensure that public funds are protected and used effectively, and subcontractors are supported to develop their provision and expand their business. The level of support will vary dependent upon the needs of the individual subcontractor, however PTP will provide any additional support that we deem necessary to ensure the quality of teaching and learning and the success rates of any subcontracted provision.  All organisations can also benefit from the following:

  • Support to develop Learner Voice Strategies
  • Preparation for External Inspection and/or audit
  • Administration Support with Awarding Organisations
  • Subsidised IAG Officer Training Qualifications
  • Subsidised Management Development Qualifications
  • Subsidised TAQA Qualifications
  • Staff development resulting from Teaching & Learning Observations, including peer-to-peer observations.


PTP will make monthly payments to subcontractors based on the correct submission of data and supporting evidence to validate learning delivery.  All funding claims must comply with the current Education and Skills Funding Agency Funding Rules and the terms of the contract between PTP and the subcontractors.

Where funding claims cannot be substantiated, PTP will adjust or reclaim any funds from the subcontractor and, where required, make an appropriate repayment to the Education and Skills Funding Agency.

PTP's supply chain fees and charges for 2016-17 can be found here


This policy will be reviewed at least annually in July each year and will be published on the PTP website,   It will be discussed with subcontractors at the beginning of each contractual year at a partnership meeting and on an individual basis in January at the performance review meetings.

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