Supply Chain Fees and Charges Policy
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Kaplan Financial - Home > Terms and Conditions > Supply Chain Fees and Charges Policy

Supply Chain Fees and Charges Policy 2018- 2019


Kaplan Financials’ approach to subcontracting1 is predicated on, and derived from its overarching statement of strategic intent. Everything Kaplan Financial does is influenced by its core values - which are;

  • Integrity – We hold ourselves to the highest ethical standards in everything we do.
  • Knowledge – We offer expert resources to help students achieve their academic and career best.
  • Support – We provide students with the tools they need to succeed.
  • Opportunity – We open doors and broaden access to education.
  • Results – We are dedicated to helping students achieve their goals - we succeed when they succeed.

Our Approach

In keeping with its core values Kaplan Financial aims to:

  • Create success – by providing honest strong advice and guidance to its clients and supply chain partners.
  • Facilitate access to education and skills training to enable people and businesses to be effective and successful in their workplace/markets and in life.
  • Be superior in the provision of professional training and Apprenticeships - by delivering the right learning and development to the right people, in the right way.
  • Be regarded as true partners in every sense of its relationships - by being resolute in our commitment to supporting our learners and employers to improve their skills, productivity and opportunities.
  • Develop lasting and effective partnerships which foster and create an understanding of shared values which puts the learner at the centre of all activities - our commitment to quality is quantifiable and verified.

Scope of the Policy

As a primary Education & Skills Funding Agency (ESFA) contract holder, Kaplan Financial is required to publish a supply chain fees and charges policy on its website if it enters into any ‘subcontracting’ agreements for the provision of:

  • Adult Education Budget pre-employment courses
  • Apprenticeships

The purpose of this document is to provide transparency for all stakeholders and/or interested parties regarding the procurement due-diligence process, fees and levels of support relating to subcontracted provision funded under the prime contract Kaplan Financial holds with the ESFA.

Rational for Subcontracting

Because Kaplan Financial recognises that effective subcontracting can improve accessibility for learners and contribute to the economic prosperity of individuals, businesses and communities; it may from time to time engage with subcontractors to:

  • Facilitate and/or improve access to high quality education, training and support.
  • Widen participation amongst learner groups that may otherwise face barriers to participation in learning and work.
  • Meet the identified requirements/demands of stakeholder, learner and/or community groups by broadening the range of Apprenticeships and/or pre-employment support services offered specifically where internal capacity and or skills-base does not exist.
  • To provide a curriculum offer that meets identified government priorities.

Risk Management

The management of Kaplan Financial subcontractors will be ‘Risk Based’. All subcontractors are risk assessed as a function of the ‘initial’ and ‘considered’ due diligence process; existing subcontractor performance is routinely monitored against the performance standards set out and agreed in the Contract for Services (and its Appendices). All subcontractors are assigned a risk rating and this rating determines the frequency and scope of the quality monitoring and audit activity undertaken by Kaplan Financials’ Quality and Compliance team.

Kaplan Financial is committed to early identification and mitigation of risk within its supply chain, this is demonstrated by its processes which ensure that all subcontractors are:

  • Selected through a due diligence process that requires demonstrable evidence of financial health/probity, quality processes and practices.
  • Managed through a process of regular performance monitoring reviews and audits.
  • Required to prepare and implement underperformance recovery plans in an agreed time frame.

Commitment to Improving Quality

Kaplan Financial is committed to improving the Quality of Teaching and Learning of all provision funded through its prime contract and will work with its subcontractors to ensure continuous improvements are put in place across the range of provision being supplied.

Performance Management Approach

Kaplan Financial will manage the performance of its subcontractors through:

  • Contract Value Review - Kaplan Financial will review the predetermined contract values with the subcontractor at regular profile review meetings. Volumes may be revised or withdrawn if the Subcontractor fails to meet key performance targets or if ESFA funding is reduced and or if an overspend is anticipated.
  • Accuracy and timeliness of Data - Kaplan Financial will review the accuracy and timeliness of data in accordance with the data collections framework set out in the Specification of the Individualised Learner Record appropriate to the applicable funding year.
  • Minimum Levels of Performance - The subcontractor must achieve the minimum levels of performance set out in the Contract for Services, Service Level Agreement. Performance targets will be reviewed regularly at profile meetings utilising the performance management report.

Management Fees

The typical percentage range charged by Kaplan Financial is between 0% and 20% on an incremental 5% scale. Kaplan Financial will pay the subcontractor the full value (per learner) of the data published in the Provider Funding Report (PFR) provided by the Data Service/ESFA - less the applicable management fee. This funding is payable for actual delivery of services against the amounts agreed and set out in the contract for services (funding allocation/profile).

The fee charged will be negotiated with individual subcontractors and will be based on several factors including but not limited to:

  • Evidence of an established relationship between Kaplan Financial and the subcontractor.
  • Market experience of the subcontractor.
  • Kaplan Financials’ risk rating awarded to the subcontractor.
  • Level of support requested or deemed to be required from Kaplan Financial.
  • Performance against target measures as agreed with the subcontractor in the Contract for Services and Appendices.

For new subcontractors, performance and risk will be reviewed in the fourth month of contracting to assess whether the fee can/or should reasonably be reduced/increased commensurate with the actual degree of risk.

Support Provided to Subcontractors

Kaplan Financial believes that the Supply Chain has a joint responsibility to deliver high quality provision to all learners and employers. Therefore, as a minimum Kaplan Financial provides the following services and support to its subcontractors:

  • Designated Quality Coach
  • Regular performance updates against clear measures of success
  • Regular performance and quality visits
  • Access to the feedback and recommendations of external/independent Quality and Compliance Consultants engaged by Kaplan Financial to identify and mitigate compliance and quality risks
  • Enrolment documentation, input and preparation of registers/progress review planning
  • MIS support to ensure courses are set up correctly and data input is correct to maximise funding
  • Monthly review data - Funding Compliance Audit
  • Observation of Teaching, Learning and Assessment
  • Additional support may be necessary/available dependant on the specific requirements of the contract

Payment Terms

Payments will be made by Kaplan Financial to the subcontractor according to the schedule for submission and payments identified in the Contract for Services, Service Level Agreement; all payments subject to timely receipt of the completed ‘new supplier requisition form’.

  • The subcontractor will be paid monthly based on values in the PFR less the predetermined management fee.
  • Kaplan Financial will provide the subcontractor with the PFR relating to the relevant learners, a financial value and purchase order number ordinarily by the 10th working day of the month following the activity.
  • The subcontractor will invoice Kaplan Financial for the financial value ordinarily by the 15th working day of the month following the activity.
  • Invoices will be paid within 30 days of invoice receipt, providing the funding has been received by Kaplan Financial from the ESFA.
  • Where funding evidence requirements have not been fully met, delivery has not been undertaken and/or funding criteria or methodology has changed, Kaplan may suspend, recover and/or offset future funding payments to the subcontractor to mitigate the risk to public funds.

Communication of the Policy

  • The policy is published on the Kaplan Financial Apprenticeships website
  • The policy will be communicated/signposted to potential subcontractors as part of the procurement process
  • The policy will also be discussed with current subcontractors as part of the contract review process

Review of the Policy

The Policy will be reviewed on an annual basis by Kaplan Financials’ Head of Data and Compliance and the Senior Management team. Kaplan Financial reserves the right to undertake a review at any time in response to material changes in the funding and or business landscape, including but not limited to, changes in government policy and/or funding.

Actual funding paid to Subcontractors and retained by Kaplan Financial

Data for the funding years: 2016 to 2017 and 2017 to 2018 can be viewed here.

1 Subcontracted provision forms part of Kaplan Financials’ overall supply chain and for the purposes of this document ‘subcontractors’ may variously be referred to as: key stake-holders, 3rd parties and or supply chain partners.

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Supply Chain Fees and Charges Policy