Around 400 out of 450 permanent staff at The Challenge will be affected after the charity confirmed that it has not been able to reach an agreement with the National Citizen Service Trust to deliver the programme from 2020.
The National Citizen Service Trust (NCS) had announced earlier this month that it will not contract directly with The Challenge to deliver or manage its programme for 16 and 17-year-olds in London, the South East and the West Midlands from 2020, despite The Challenge saying that negotiations were still ongoing.
But yesterday The Challenge issued a statement saying it had been unable to resolve the issues, and confirming the impact upon its staff.
The NCS was formally launched by the government in 2010 and The Challenge has been heavily involved in delivering the programme since then.
The Challenge: 'We have been unable to resolve certain important contractual issues'
In a joint statement, The Challenge’s chair Bill Ronald and chief executive Oliver Lee, said: “For several months we have been in discussions with the NCS Trust regarding NCS provision for 2020 and beyond. Regrettably, we have been unable to resolve certain important contractual issues that adversely affect The Challenge’s ability to operate on that future landscape. It is therefore with much sadness that we confirm from 2020 that The Challenge will no longer play a role in the delivery of NCS to young people across the UK.
“The Challenge has been at the forefront of NCS as its largest provider, delivering first-class, value-for-money NCS provision. It has played a critical and founding role in NCS for over 10 years from the initial design of the programme to directly supporting over 242,000 young people to have a life-changing experience through it, and we are immensely proud of these achievements.
“The Challenge will no longer be participating in NCS provision, but will continue its other important work, including through HeadStart, the award-winning programme developed in partnership with the Mayor of London and leading employers, to bridge the gap between education and employment, whilst enabling young people to meet those different from themselves and become socially active in their local community.”
Disagreement over IT system
A statement from the NCS Trust earlier this month had said: “The Royal Charter body has been unable to reach an agreement with the charity over a contractual requirement to use a shared IT system that ensures value for money, improves customer experience and protects young people’s data.”
It added: “NCS Trust had concerns this summer when around 4,000 young people were let down by The Challenge because they weren’t allocated a place on their chosen programme.”
In 2017, 45,000 young people took part in NCS programmes run by The Challenge or its subcontractors. The Challenge's income for the financial year to 31 October 2017 was £69.8m, and its contract to deliver NCS was its principal source of income.
In the same statement, the NCS Trust's CEO Michael Lynas said: “We need to ensure a consistent customer experience, secure value for money for the taxpayer and safeguard the data of the young people who take part. That’s why our contracts stipulate that all partners use a single shared IT platform.
“Unfortunately, since The Challenge is unwilling to use this important system, which is successfully used by all other partners in the NCS network, we are unable to award contracts. As the commissioning body, entrusted with selecting the best organisations to safely deliver NCS while offering value for public money, this decision is the best way for us to continue to achieve these aims.”
The Challenge remains contracted to delivering summer and autumn NCS programmes in 2019 until their contract ends in December.
The Challenge spent £66m on delivering NCS programmes, but does not specify in its accounts how much money it received specifically to deliver NCS.