Supply Chain Fees and Charging Policy 2017-2018

1. Introduction

1.1 Purpose

The purpose of this document is to give details of the Supply Chain Fees and Charges Policy offered by Oldham Training Centre (OTC) to sub-contracted providers. This policy should be read in conjunction with other OTC policies and procedures and the sub-contract.

1.2 Scope

The Supply Chain Fees and Charging Policy will be communicated via the Training Manager to all sub-contracted provision. OTC website will publish the policy. This policy shall be operated with effect from 1st August 2015 and revised annually.

1.3 Responsibility

Responsibility lies with the Senior Management Team to ensure that the Supply Chain Fees and Charging Policy is adhered to.

1.4 Entering into sub-contracting arrangements

OTC sub-contracts in order to extend the range of its provision and to address the needs and support the delivery of learning in the community. It also helps us to support Local, Regional and National Strategies and reach out to under-represented groups, making us a more inclusive organisation. All applicants must demonstrate the quality of their provision by ensuring that their organisation is on the Register of Training Organisations.

1.5 OTC does not appoint sub-contractors that hold an aggregate contract value of £100,000 or above per academic year, including any proposed provision, unless they are listed on the Register of Training Organisations.

1.6 Contracting

We will only award contracts for delivering funded provision to legal entities. If the legal entity is a registered company, it must be recorded as ‘Active’ on the Companies House database.

1.7 We will not award a contract to a legal entity if:

  • It has an above average risk warning from a credit agency.
  • It has passed a resolution (or the court has made an order) to wind up or liquidate the company, or administrators have been appointed, or
  • Its statutory accounts are overdue.



2. Fees

A Standard Management Fee is negotiated and applied to all subcontracted contract in the percentage range of 15 to 20%. This is the proportion of ESFA funding retained by OTC to cover standard costs incurred through its management of these contracts. These costs include:

  •  Administration
  • Quality assurance and monitoring
  • MIS functions relating to the submission of funding claims to the ESFA
  • Due diligence support, guidance and checking.


All fees will be agreed with subcontractors prior to the issuing of contracts, and will be reviewed prior to annual re-contracting

2.1A penalty will be applied if the sub-contractor’s success/timeliness rates do not meet minimum levels of performance. These will be set annually by OTC, and will take into account the minimum levels of performance set by the ESFA.


This penalty may also apply if the sub-contractor:

  • Receives a Grade 4 for Teaching, Learning & Assessment and other key learner experiences
  • Has an internal audit error rate of over 5%
  • Has inadequate Safeguarding Procedures



3. Quality of Provision


Due diligence will be completed prior to entering into sub-contracts with any provision. Subcontractors will be required to supply OTC with all relevant information requested to protect learners and to ensure they are a legally, financially, ethically and an educationally sound organisation, prior to any contract being signed.

OTC will set performance standards and performance levels required and will ensure that partners fully understand their commitments.


OTC will monitor subcontracted provision, and actively improve quality on an on-going basis by:

  • Scheduled Quality Assurance Audits throughout the year.
  • Annual reviews with target setting.
  • Regular management meetings with subcontractors.
  • Providing appropriate and well-experienced business support staff.
  • Collating, in partnership with sub-contracted provision feedback from learners and employers
  • Administering the programme payment schedule as agreed.
  • The Board of Directors and the Chief Executive are satisfied that each subcontractor meets the strategic aims and enhances the quality of the learner experience.



Fees Paid to Sub-contractors 2016/2017

Delivery of Technical Certificates within an Advanced Apprenticeship Framework



 SFA Funding

 Paid to Sub-Contractor

 Retained by OTC






 Tameside College






Fees Paid to Sub-contractors 2015/16

Delivery of Technical Certificates within an Advanced Apprenticeship Framework



 SFA Funding

 Paid to Sub-Contractor

 Retained by OTC