Westgate Nursery School near Swindon was told last week that two trainees could complete their course, but the LSC would no longer back it as a training provider.
Sandria Murkin, owner of the nursery, condemned the decision and accused the LSC of pulling the plug on its training programme after the nursery had put right many of the problems identified in the ALI report.
However, Alison Bennett, the LSC's director of service delivery for Wiltshire and Swindon, said the decision was made because 'no learners have completed their training and ended up with a qualification and therefore we have decided to fund future learners through other providers'.
Kathryn Taylor, manager of Westgate Nursery, said she was saddened by the decision. 'I have put an immense amount of work into getting things right and we had developed a written quality procedure,' she said. Ms Taylor said the scale of the ALI inspection and the large amount of paperwork she had to deal with were disproportionate to the size of the 52-place nursery.
But Alison Bennett said, 'This is not a small employer issue - we have several small training providers. It is a quality of learning experience issue, and the fact is that our duty is to ensure those getting the training are getting value for money and completing with qualifications.'
The ALI inspectors said that Westgate's achievement rates were poor, that 'no learner has yet achieved the full modern apprenticeship framework' and that 'none of the learners is aware of the requirements of the key skills qualification or has started their training or assessment'.
An ALI spokeswoman said that funding decisions were up to the LSC. But she added, 'We work closely with them and inevitably they do study our reports and then make a judgement on whether they are satisfied with the training provided.'