Because this isn’t *quite* what you’re describing, is it?:
From academic year 2019 to 2020, students with a grade 2 or below in maths or English can study towards a pass in functional skills level 2 (legacy or reformed) or they can still study towards a GCSE grade 9 to 4. Once they have achieved this, there is no requirement to undertake further maths or English qualifications to meet the condition of funding.
(of course, “meet the condition of funding” and “what Ofsted might expect” are two different things as well, just cos you’re not getting penalised for them not being on GCSE shouldn’t mean they’re not doing any M&E for a year…)
Well, I got an answer and it wasn’t what I was expecting (in a good way!):
Thank you for your enquiry.
When a student holds a functional skills level 2 qualification, they meet the condition of funding and do not have to do further study.
As the highest prior attainment fields only record GCSE grades, providers must record that the student holds a functional skill with code 5 (“learner holds a pass grade for functional skills level 2 in maths/English”) in the ECF and/or MCF funding and monitoring (FAM) section. In the school census, providers record code F in the maths/English GCSE funding exemption field. This is in the ‘Summary’ section on the GOV.uk page: http://www.gov.uk/guidance/16-to-19-funding-maths-and-english-condition-of-funding.