Mixed reaction to NAO report into free schools

Janet Downs's picture
There’s been mixed reaction to the National Audit Office (NAO) report on free schools according to Schools Improvement Net.  The Times says they’re ‘good value for money’ while the Guardian reports costs are rising and over budget.  The Telegraph says they’re in areas of need while the Independent says they’re not.

So, what did the report say?  I’ve taken the points from the NAO summary leaving nothing out.  I’ve avoided commenting but when I have I’ve put comments in brackets.


87% of places in primary free schools are in areas of need but 81% of secondary free school places are not.

1/3 of free schools are in London.

The estimated total capital costs for free schools opened in areas where there’s no forecast need for extra school places are at least £241m out of a projected total of £950m for mainstream schools.

The Department for Education (DfE) has received no applications to open primary free schools in half of the areas where there’s a high/severe need for extra places.

The DfE has improved its selection and pre-opening process BUT important information about sites, parental demand and key staff “remains limited”.  Fifteen approved projects were subsequently cancelled/withdrawn because (a) problems with sites, or (b) concerns about proposers’ capacity.

The DfE’s selection decisions focus on individual schools rather than on the wider benefits of the policy compared with costs.

The DfE underestimated the total capital funding needed to set up free schools.  It increased from £900m to £1.5b, just over 8% of the department’s total capital budget.  The average unit cost of premises is £6.6m: more than double the DfE’s original estimates.

Despite the lower average construction costs compared with earlier school building programmes, the DfE faces a rising capital cost trend.  The latest capital costs for 60% of Wave 2 and 3 free schools are forecast to be higher than original estimates.

60% of free schools opened in temporary accommodation

The day-to-day funding for free schools is broadly equivalent to other types of schools.  £80m of “time-lagged funding” had been given to local authorities for pupils who’ve subsequently moved to free schools.  This funding will not be recovered.

The DfE and Educational Funding Agency will need to further develop their risk assessment and monitoring of free schools’ finances and governance.

Some free schools haven’t attracted as many pupils as expected in their first year although pupil recruitment improved after the first year.  Schools in temporary accommodation or late signing of funding agreement were more likely to have unfilled places.

The DfE hasn’t made full use of a growing evidence base to improve management of the free schools programme.  The NAO found some free schools are using their freedom (presumably Admission Criteria) to develop different pupil characteristics from nearby schools.

The DfE needs to consider which factors impact of school performance, eg occupancy trends or the departure of head teachers.  It also needs to decide how to assess the impact of free schools on neighbouring schools.


1         The DfE has moved rapidly towards its declared policy priority but maximising value for money has not been a primary factor.

2         Whether this programme will prove value for money depends on how the schools perform.

3         The DfE will need to control a rising cost trend.

4         The £1.5b planned investment needs safeguarding.  Problems have been identified in some early free schools.

5         The DfE asked the NAO to “record that it believes it has struck an appropriate balance between pace and value for money”. (Surely it’s not normal for the subject of an investigation to request the NAO to include information.  The point of an investigation is that it’s independent).

I’ll post the recommendations as a FAQ shortly.
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