Fairer funding - lets not have more winners and losers

Fiona Millar's picture

Amid all the controversy about the government's new "academise all schools" White Paper, it might be easy to forget that there is another, equally important, education policy in the pipeline. Plans for a national funding formula were announced in the Chancellor's Autumn Statement and earlier this month the first of two consultations  was published, setting out how this formula should be structured.

Why is this happening? In an article in the Guardian several months ago, I attempted to explain this issue. Schools funding in England has developed in a  haphazard way over the last fifty years, leading to wide disparities between schools in different local authority areas. A complex array of local and national funding arrangements, developed over decades, can mean that schools barely miles apart but across borough or county boundaries receive vastly different revenue per pupil, even if that pupil comes with the similar needs and social profile.

 In the past some local authorities chose to top up their school funding from their own budgets creating further variation between local authorities. When the Labour government introduced the current mechanism for funding schools, the Dedicated Schools Grant, in 2006, existing variations were "baked in" to the new system and been exacerbated by every subsequent percentage increase in school funding.

A vigorous campaign by the F40 Group ( the 40 most poorly funded local authorities) has finally persuaded the government to act. A new national formula will be in place by 2020, by passing local authorities so the money will go directly to schools. The first consultation sets out some broad principals on which that formula will be based, though no figures have yet been published.

The consultation points out that the DFE's fairer funding formula won't mean every school gets exactly the same amount of money because  the new formula will have four "building blocks". These are:

  •  per pupil costs - a flat sum for each pupil
  • additional needs costs - to reflect disadvantage , EAL and prior attainment of pupils
  • school costs - to refect factors such  as sparsity in rural areas,  small schools, historic PFI contracts and so on
  • geographic costs - which would reflect issues like higher teacher pay in areas like  London.

The pupil premium will remain outside the funding formula for now. There will be a separate, though much reduced, grant for local authorities to carry out the few responsibilities - SEND, place planning, safeguarding and admissions - that will remain with them once the current onslaught on local government is complete . There will be a separate consultation and formula for high needs (SEND) pupils.

Nevertheless the consequences of these changes could be dramatic in some areas for the simple reason that there is no significant new money to smooth this transition. The process of moving from the current situation  to the new formula will take place over two years and will effectively redistribute funding from the more highly funded areas to the least well funded.

Inner city areas like London are likely to be the most hard hit. I would be the first to admit that London schools have been very generously funded in the last twenty years. My own children benefitted from that, as did thousands of other young people from much more disadvantaged backgrounds. The consequence of that funding, combined with strong school leadership and collaborative working arrangements brokered through the London Challenge, is that London schools are a great success story and the envy of other capital cities around the world.

A few weeks ago I chaired a packed meeting at the House of Commons at which heads, governors, councillors, parents, teachers and pupils from across London came together to discuss how we should respond to this policy. There was widespread agreement that we want to spread the great advantages that London schools have had to other parts of the country, but not at the expense of our children. You can see a link to the Keep London Schools Great campaign here,  sign our petition and see a model response to the (limited) questions in the consultation.

It is important that we respond to the consultation. We don't yet know how much weighting will be placed on each of the four building blocks but we need to  remind the government of what the Sutton Trust calls "double disadvantage', the impact of being a disadvantaged pupil growing up in a poor area. Funding for many inner city schools should reflect that. 

We want to see the new funding formula properly funded with new money to ensure  that no school loses out, that real disadvantage is properly addressed and that success stories such as London are not undermined. Schools are facing an onslaught of funding cuts at the moment - that will translate into larger classes, higher teacher workload, possible redundancies and cuts to the curriculum and vital school enrichment programmes.

Of course those schools in the most poorly funded areas urgently need the extra money that the new formula with bring. But creating more winners and losers isn't the answer if we want to spread success equally across the country.



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Janet Downs's picture
Sat, 26/03/2016 - 11:35

This fairer funding will do no more than redistribute already limited funds rather than bring poorly-funded schools up to the level of the best.

The Consultation document is disingenuous when it says its fair funding will allow schools to decide how to use their entire  budget for the benefit of their pupils.   But that is not true for academies in multi-academy trusts (MATs).  They will not receive their money directly.  It will be sent to the MAT whose trustees decide how the money will be allocated not each individual academy.

In 2010, the OECD said the UK were among only four countries which allowed considerable freedom in how schools used their budgets, employed teachers and allocated resources.  Far from increasing freedom, this Government and the last have established a system by which individual schools will not be able to do these things if they are academies in MATs.

The front page of 'Schools Week' print edition  last Thursday was mainly white with this slogan in solid black:

'Schools are set free, and everywhere are in chains.'

This repeats something I said in December 2011: 'They create a prison and call it freedom.'

Emma Bishton's picture
Sun, 27/03/2016 - 14:51

I quite agree. On Wednesday, at the Anti-Academies rally (a great event where there were some rousing speeches), I was offered a petition form and flyer called "Keep London Schools Great".  My problem is that I'm not in London, I'm in Suffolk, one of the 40 lowest-funded authorities for school spend per capita. (I believe it is £3642 per pupil, not far off £2K less than the average of the highest-funded authorities). So in Suffolk we are set to benefit from the new formula - and given that there are some ongoing attainment issues in Suffolk this would of course be welcomed, were it not at the expense of other people's children. It is not in my interests or anyone elses that our children receive more funding at the expense of others, or that the success of London's schools be neither sustainable nor replicable in other areas.    In setting up a new formula without adequately addressing the funding gap across the whole budget, the government is setting one parent against another (not to mention trying to set parents against them full-stop). And they are presumably hoping that in the resulting melée they can not only push this through, but give all the funding to a whole load of private MATs anyway.

Fiona Millar's picture
Sun, 27/03/2016 - 17:07

Thanks for this supportive comment Emma. I am totally in favour of levelling up the most poorly funded authorities, although also feel it should be noted that one of the reasons local authorities like mine (Camden) is relatively well funded is that our Labour council took a positive decision to put extra money into schools over ten years ago, and then became embedded in the new funding arrangements in 2006. I can't help suspecting that this whole thing will also be a cover for cutting school funding overall. This will help to push people into the arms of the private sector at a later stage. Also once schools are directly funded from Whitehall and the local formulae become irrelevent ( and the schools forum goes), local authorities will be completely eclipsed at a local level.

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