Why Adult Skills Funding Is Becoming More Local

A major change is underway in how England commissions adult skills provision. On 30 September 2026, the Department for Education confirmed that current nationally procured Adult Skills Fund service contracts will expire on 1 August 2027 and that it does not intend to run another national procurement exercise for the 2027 to 2028 academic year. Instead, the government says it will continue expanding the pathway towards devolution, transferring funding previously delivered through directly procured contracts in non-devolved areas to local authorities.

For learners, the change may initially sound like an administrative decision about government contracts. Its significance is broader. Adult skills funding determines which types of education and training can be supported with public money, while commissioning decisions influence which providers deliver that learning and how provision responds to the needs of different communities.

The direction of travel is towards more decisions being made locally rather than through a single national contracting model. That creates opportunities for adult education to respond more closely to local labour markets, but it also raises important questions about consistency, provider access and what increasingly localised commissioning could mean for learners whose education is delivered remotely.

What is the Adult Skills Fund?

The Adult Skills Fund, usually shortened to ASF, supports education and training for eligible adults in England. It covers a broad range of provision, with detailed funding rules determining which learners, qualifications and programmes can receive support.

The current system already combines national and devolved arrangements. For the 2026 to 2027 funding year, Department for Work and Pensions-funded ASF delivered outside devolved areas continues to operate under national funding rules, while strategic authorities administer funding within areas where adult skills responsibilities have been devolved.

This distinction matters because adult education is not moving from a wholly national system to a local one overnight. Devolution has been developing over several years, and different parts of England are already at different stages. The September announcement indicates that this process will continue rather than being reversed through another national procurement round.

What has the government announced?

The immediate announcement concerns currently procured ASF service contracts. These contracts expire on 1 August 2027, and the government says it will not run a national procurement exercise to replace them for the 2027 to 2028 academic year.

Instead, funding previously delivered through directly procured contracts in non-devolved areas is intended to transfer to local authorities as the ASF pathway to devolution expands. The government says local authorities can use their knowledge of local skills needs to commission appropriate providers and training.

One important qualification is that the announcement does not apply in the same way to every provider receiving adult skills funding. The Department for Education explicitly states that the change will not affect providers with grant funding agreements.

For providers operating under procured contracts, however, August 2027 is now an important date. Future access to funded delivery may increasingly depend on commissioning arrangements established by the relevant local or strategic authority rather than a replacement national contract.

Adult skills devolution is already happening

The September announcement is easier to understand in the context of the wider devolution programme. Adult skills responsibilities have already transferred to a growing number of strategic authorities, with funding allocated for locally administered provision.

Government grant determination letters for 2026 to 2027 identify 13 specified strategic authorities responsible for administering ASF in their devolved areas, including Cambridgeshire and Peterborough, Cornwall, East Midlands, Greater Lincolnshire, Hull and East Yorkshire, Lancashire, Tees Valley, West of England and York and North Yorkshire.

The scale is substantial. For example, the published 2026 to 2027 academic-year figures show more than £53 million of core Adult Skills Fund support for the East Midlands, more than £41 million for Lancashire and more than £30 million for Tees Valley. The precise arrangements differ between areas and funding streams, but these figures illustrate that localised adult skills commissioning is already a significant part of the system rather than a future experiment.

The government says that as more areas assume responsibility, the proportion of ASF delivered in non-devolved areas reduces. Ending another national procurement round is therefore part of a wider shift in where responsibility for adult skills provision sits.

Why move adult skills decisions closer to local areas?

The central argument for local commissioning is that skills needs differ across England. The employment opportunities and workforce shortages of a large city can differ significantly from those of a rural county, coastal community or region dominated by particular industries.

Local authorities and strategic authorities can potentially use information about employers, vacancies and regional economic priorities when deciding which provision to support. In principle, that allows public funding to be directed towards skills that are particularly relevant to the economy and communities of a particular area.

Existing devolved arrangements already demonstrate this approach. London’s 2026 to 2027 ASF rules, for example, require funded providers to respond to priorities in the London Growth Plan, Inclusive Talent Strategy and priorities identified by local commissioners and other stakeholders, including the Local Skills Improvement Plan. London City Hall

The practical question will be how successfully different areas translate local knowledge into accessible learning opportunities. Identifying a skills shortage is only one part of the process. Learners must also be able to find suitable courses, providers need the capacity to deliver them, and the resulting training needs to offer meaningful progression.

Could provision become more responsive to local employers?

Closer links between commissioning and regional labour markets could make some adult skills provision more responsive to employers. If a local area identifies persistent shortages in construction, digital skills, health and social care or another sector, commissioners may have greater scope to prioritise relevant training.

That could help adults considering midlife retraining. Career changes involve a considerable investment of time and often money, so access to training aligned with genuine employment demand can make the decision more purposeful.

However, local labour-market alignment should not be interpreted as requiring every adult course to lead directly to a single local vacancy. Education can support progression in many ways, including foundational skills, movement into further study and development of capabilities that transfer between occupations.

A balanced local skills system therefore needs to consider immediate employer demand alongside learners’ longer-term needs. Adult education serves individuals as well as labour markets, and those objectives will sometimes overlap without being identical.

What could local commissioning mean for learners?

For many learners, the administrative structure behind a funded course may remain largely invisible. They are more likely to notice whether a suitable programme is available, whether they meet its eligibility requirements and whether the method of delivery fits around their circumstances.

Over time, greater local commissioning could produce more visible differences between areas. Local authorities may prioritise different sectors or types of provision according to their skills strategies, potentially making the funded offer less uniform across England.

Variation is not automatically a weakness. Different local economies genuinely have different needs, and allowing areas to respond to them is part of the rationale for devolution. The challenge is ensuring that geographical variation does not create unnecessary barriers for adults who need education but happen to live on the other side of an administrative boundary.

That issue becomes particularly interesting when combined with flexible learning. Online and distance education can reduce the importance of physical distance between learner and provider, while funding systems can remain closely connected to where the learner lives.

What does this mean for distance learning providers?

Distance learning introduces an unusual dimension to local skills commissioning because the provider and learner do not necessarily share the same geography. A college delivering face-to-face education may naturally serve its surrounding area, whereas an online provider can potentially teach adults across many different regions from a single operation.

As commissioning becomes more local, providers operating across England may need to understand a growing range of local arrangements, priorities and procurement processes. Educational content may be delivered consistently, while access to publicly funded places could increasingly depend on decisions made within individual areas.

This does not make distance learning incompatible with devolution. Remote provision can potentially help local commissioners reach learners who cannot easily attend conventional classes because of employment, caring responsibilities, disability, transport or geography. The key question is whether commissioning frameworks are designed to allow appropriate providers to participate.

For ADLC members and the wider distance learning sector, the development is therefore worth following closely. The ability to deliver education nationally does not automatically mean that funding will continue to be commissioned nationally.

Could local funding create a postcode lottery?

The phrase “postcode lottery” is often used when public services differ geographically, but it is too early to conclude that the expanding ASF devolution programme will necessarily produce that outcome. Local variation is partly intentional because authorities are being given greater ability to respond to different economic and skills needs.

Nevertheless, there is a legitimate question about consistency. Adults may have similar educational needs while living in neighbouring areas governed by different commissioning priorities. If localisation produces significantly different access to comparable training, learners and providers will need clear information about why those differences exist and which opportunities are available.

National rules will also continue to matter. The government publishes Adult Skills Fund funding and performance management rules covering Department for Work and Pensions-funded ASF provision delivered through the national system, while devolved authorities operate their own arrangements within the responsibilities transferred to them.

The eventual learner experience will therefore depend on the interaction between national policy, local commissioning and individual providers rather than devolution alone.

What happens to providers with existing contracts?

For providers holding the procured ASF contracts covered by the announcement, the key date is 1 August 2027. The government has said those contracts will expire and that it does not intend to replace them through another national procurement exercise for 2027 to 2028.

That gives the sector a transition period, but it also means affected providers will need to understand how commissioning develops in the areas where they hope to continue delivering funded provision. The process may involve relationships with local authorities or strategic authorities rather than a single national contracting route.

Providers with grant funding agreements are explicitly outside the scope of this particular change. The funding landscape is therefore more nuanced than a simple statement that all adult skills funding is becoming local from August 2027.

For learners, continuity will be an important consideration during that transition. Providers and commissioners will need to communicate clearly so that changes to contracting arrangements do not create unnecessary uncertainty for adults planning education.

Why does this matter beyond funding administration?

Funding systems shape education even when learners rarely encounter them directly. Decisions about who controls budgets influence which courses are commissioned, which providers can deliver them and which priorities receive the greatest attention.

The move towards local commissioning also reflects a broader shift in how we think about adult skills. Rather than treating adult education as a single national market with identical priorities everywhere, the developing model gives local areas a larger role in connecting learning with economic and community needs.

That sits alongside other changes in adult education, including the increasing emphasis on lifelong learning and the development of more flexible approaches to post-18 finance. Together, these reforms reflect an education system adapting to careers that are increasingly likely to involve repeated periods of learning and retraining.

Whether local commissioning improves outcomes will ultimately depend on implementation. Devolution creates the opportunity to make decisions closer to employers and learners, but the quality, accessibility and range of the resulting provision will determine whether that opportunity produces practical benefits.

What should learners and providers watch next?

The immediate system for 2026 to 2027 remains in place, with the current funding year running from 1 August 2026 to 31 July 2027. The government’s Adult Skills Fund funding rules continue to set out requirements for provision funded through the national arrangements.

Attention will increasingly turn to how funding currently delivered through expiring procured contracts is transferred and how individual areas choose to commission provision for 2027 to 2028. Those decisions will provide a clearer indication of what the change means for providers operating across multiple regions and for learners seeking funded education.

The development of new strategic authorities is also relevant. The 2026 funding settlements already show adult skills responsibilities expanding into additional areas, reinforcing the government’s statement that a progressively smaller proportion of funding will remain within non-devolved arrangements.

For the distance learning sector, the central issue will be whether increasingly local commissioning can retain the advantages of education that is not geographically constrained. Local knowledge and national reach do not have to conflict, but future commissioning models will need to accommodate both if learners are to benefit fully from flexible provision.

A more local adult skills system is taking shape

The announcement on future ASF contracting provides a clearer indication of where adult skills policy is heading. Nationally procured contracts covered by the change will end in August 2027, no replacement national procurement is planned for the following academic year, and the government intends to transfer more responsibility to local areas as devolution expands. GOV.UK

For local authorities, that creates greater responsibility for understanding skills demand and commissioning suitable provision. For providers, it may require engagement with a more geographically varied funding landscape. For learners, the key question is whether those structural changes translate into accessible, relevant opportunities to develop skills throughout adult life.

Local decision-making can connect training more closely with the communities and economies it serves. The next stage will show how that principle works in practice, particularly for distance and flexible learning providers whose ability to reach learners has never been defined neatly by local boundaries.