Mystery over £10m Sheffield City Region Skills Bank cash

The Skills Bank received £17m of taxpayers’ cash to help businesses train staff and was run by accountants PwC for two years until March 2018.When it ended, some £6.4m had been spent – leaving £10.6m untouched.

Funding came from two pots, one handled by the Local Enterprise Partnership - part of the Sheffield City Region organisation - and the other by the Education and Skills Funding Agency.

Now a row has broken out between the SCR and the ESFA about what happened to the unspent cash.

An SCR spokeswoman said they did not receive it.

She added: “All Sheffield City Region money in the first phase of Skills Bank was fully allocated to businesses, as per the deal that was agreed.

“This supported 465 businesses and 2,741 employees to complete training between January 2016 and March 2018.

“We also know that PricewaterhouseCoopers, which delivered the project, had a separate contract with the Education and Skills Funding Agency.

“Any unspent money in relation to this contract is a matter for the ESFA and its providers. The Sheffield City Region was not part of any contractual relationship, nor engaged in performance management.

“Any reallocation of European funding into the region would be to the geographical area, to benefit our residents and businesses and not into Sheffield City Region as an organisation.”

But the ESFA says the two funding pots were used together with the oversight of the Local Enterprise Partnership. PwC spent £6.4m and unused funding “goes back into the LEP pot to be reused for the benefit of Sheffield City Region.”

A PwC spokesman said: “As PwC is no longer involved with the Skills Bank we are not in a position to respond to questions even in respect of the time period for which we were involved. Any update should be sought from the Sheffield City Region LEP.”

The firm received a £924,000 management fee.

Sheffield Chamber chief Richard Wright said the underspend was disappointing.

"Whatever the reason and whoever’s money this was, it is disappointing this funding did not get out to businesses who needed it.

“Businesses have real problems with getting the right skilled workforce and, despite the softening in the employment figures announced this morning, I can’t see that changing in the near term.

“Companies did find the money hard to access and the Skills Bank unresponsive at times so let’s hope they have got those issues sorted with the new one.

“I would also like to see much more of the money being spent training the workforce against our strategic view of the future economy not just the routine , and in many cases mandatory, requirements businesses are legislated to do.

“The highest performing regions will be those with good strategic plans that identify where we are going to create wealth 10 or 20 years from now and who train their employees in anticipation of that. It is absolutely right to have a skills bank but we need to ensure it produces the outcome we need.”

A second Skills Bank was launched in April run by Calderdale College in Halifax with £5.4m of ESFA money.