Cash for colleges and other providers of youth training could soon be largely dependent on the success of the trainee, writes David Charter.

Training and Enterprise Councils are being asked by the Department of Employment whether week-by-week funding for trainees should switch to 25 per cent payment on recruitment and 75 per cent on outcome achievement.

The TECs are free to contract with providers in their own way and would be able to pass on these funding criteria.

A consultation document from the DoE says outcome funding "gives clear incentives to TECs and providers to offer training that leads to positive results for young people. By making a greater proportion of the budget dependent on the achievement of the outcome, there is an incentive to improve both the quality of the training delivered and the assessment and guidance offered to a young person prior to their starting training".

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Between 25 and 40 per cent of funding for Youth Training is currently linked to the outcome of the programme, but the majority is based on the time spent training on a week-to-week basis.

"TECs and training providers have to maintain administrative systems to record and claim for both weekly payments and outcomes," said the DoE.

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Pilot funding schemes based on starts and outcomes have been run with six TECs in Youth Training which in all cases increased the NVQs achieved per 100 school-leavers.

The DoE consultation document acknowledges the fears already being voiced by TECs and colleges.

Potential drawbacks include cash-flow problems, since a steady stream of outcomes is necessary and the temptation to provide short, cheap courses to maximise income.

There is also the risk of abusing the NVQ system because of an increased pressure on the achievement of qualifications.

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The DoE says one possibility is to retain interim payments for "milestones" - individual units of an NVQ, for example.