Subcontractor Supply Chain Fees and Charging Policy 2026/2027
Subcontractor Supply Chain Fees and Charging Policy 2026/2027
1. Policy Statement
Dynamic Training UK Limited (“Dynamic Training”) will only enter into subcontracting arrangements where they deliver clear value and meet an identified local, regional, or sector-based need that cannot be met through direct delivery.
Subcontracting will be used exceptionally and not as a routine delivery model, in line with 2026–2027 Apprenticeship Funding Rules. The organisation prioritises direct delivery and will only subcontract where it demonstrably enhances:
• Quality of provision
• Learner and employer access
• Specialist expertise
Dynamic Training will ensure that all subcontracted provision:
• Is fully compliant with DFE funding rules
• Is subject to robust oversight and quality assurance
• Does not duplicate existing provision
Expansion of subcontracting is not a strategic objective for 2026–2027.
Dynamic Training retains full accountability for:
• Quality of education and training
• Funding compliance
• Learner outcomes
This policy is published annually in line with DFE transparency requirements.
2. Subcontracting Process
2.1 Due Diligence and Approval
All subcontractors must complete a comprehensive due diligence process prior to contracting. This is in addition to any requirement for inclusion on the Apprenticeship Provider and Assessment Register (APAR).
The process includes:
• Financial health checks
• Quality performance review (including Ofsted where applicable)
• Safeguarding and Prevent compliance
• Capacity and capability assessment
• References and delivery track record
• Business case aligned to identified need
All subcontractors must be formally approved by the Board of Directors.
Dynamic Training will only contract with organisations that:
• Are on the APAR (where required)
• Meet DFE funding requirements
• Agree to full audit and transparency
2.2 Contracting and Review
Subcontracting arrangements are actively managed through:
• Monthly contract review meetings
• KPI monitoring (recruitment, retention, achievement, quality)
• Compliance and funding assurance checks
2.3 Accountability
Dynamic Training retains full responsibility for:
• Quality of delivery
• Accuracy of funding claims
• Compliance with DFE rules
3. Supply Chain Fees
3.1 Fee Structure
Dynamic Training applies a transparent and proportionate management fee:
• Standard fee: 15%
• Reduced fee: up to 8.5%, subject to performance
All fees are:
• Justified
• Documented
• Proportionate to services provided
3.2 Services Covered by Fees
Fees include:
• Named contract manager
• Monthly performance and compliance meetings
• Management Information (MI) reporting
• Funding claim review and submission
• Invoicing and payment processing
• Quality assurance, including:
o Observations of teaching, learning and assessment
o SAR and QIP support
• Quality reviews and audits
• Compliance monitoring
• Sharing best practice, policies and procedures
All subcontracted provision is subject to annual quality assurance activity, with additional intervention where required.
3.3 Additional Charges
Additional charges may apply for:
• Delivery of programme elements
• Assessment and verification
• Awarding organisation registration/certification
• Use of systems (e.g. e-portfolio)
• Learning resources
All additional costs will be:
• Agreed in advance
• Clearly documented
• Included in contractual agreements
4. Risk Management Framework
Dynamic Training applies a structured approach to managing subcontractor risk to ensure protection of public funds, quality of provision, and compliance.
4.1 Risk Assessment
All subcontractors undergo initial and ongoing risk assessment, including:
• Financial stability
• Quality performance and Ofsted grading
• Delivery track record
• Staffing and capacity
• Safeguarding compliance
• Funding rule compliance
Each subcontractor is assigned a risk rating:
• Low /Medium/High
4.2 Ongoing Monitoring
Risk is monitored through:
• Monthly KPI reviews
• Data validation and ILR checks
• Learner and employer feedback
• Quality assurance activities
• Audit and compliance checks
Monitoring intensity increases with risk level.
4.3 Key Risk Areas and Controls
Quality Risk
• Observations and standardisation
• SAR/QIP monitoring
• Improvement plans
Funding & Compliance Risk
• Data audits and funding checks
• Compliance reviews
• Clawback where necessary
Financial Risk
• Financial monitoring/Payment controls
Safeguarding Risk
• Policy and training checks
• Immediate escalation procedures
Delivery Risk
• Caseload and staffing reviews
• Capacity monitoring
Reputational Risk
• Feedback monitoring
• Complaints management
4.4 Escalation and Intervention
Where risk increases:
• Enhanced monitoring is implemented
• A Performance Improvement Plan (PIP) is issued
• Delivery volumes may be reduced or paused
Serious breaches may result in:
• Contract suspension
• Contract termination
• Reporting to DFE or relevant authorities
4.5 Exit Strategy
Dynamic Training maintains an exit strategy to ensure learner protection, including:
• Transfer of learners to alternative provision
• Continuity of training and funding
• Communication with employers and stakeholders
4.6 Governance
Risk management is overseen by:
• Senior Leadership Team & Board of Directors
Regular reporting ensures:
• Effective oversight
• Compliance with funding rules
• High-quality learner outcomes
5. Governance and Transparency
Dynamic Training will:
• Publish this policy annually
• Maintain a list of subcontractors
• Ensure all arrangements comply with DFE rules
• Review subcontracting value for money
Subcontracting arrangements that do not demonstrate clear value, quality, or compliance will be discontinued.
6. DFE Compliance Statement
This policy aligns with 2026–2027 Apprenticeship Funding Rules, including:
• Subcontracting as an exceptional activity
• Full accountability retained by the main provider
• Transparent and proportionate fee structures
• Robust due diligence and oversight
• Annual publication and governance approval.