A ten-year plan for school and college funding Contents

Conclusions and recommendations

Funding pressures

1.We are pleased that the Department is beginning to acknowledge the significant financial strain that schools and colleges are under. There is simply not enough core funding, and the capital funding landscape is becoming increasingly concerning. The Department’s recognition of this problem now needs to be translated into significant funding increases. (Paragraph 18)

2.The Department must make the strongest possible case to the Treasury for a multi-billion pound funding increase in the next spending review, and ensure this is aligned with the requirements for a ten-year plan as set out in Chapter 7 of this Report. (Paragraph 19)

3.We heard disturbing reports that the Department was spending millions on ‘school resource management advisers’ whose cost-saving suggestions included keeping money raised at charity events, cutting children’s food portions, and using spare staff to cover three simultaneous classes in a school dining hall. The Minister said these recommendations had been taken “out of context”. We call on the Department to release the full reports to us, to show the context in which the recommendations were made. (Paragraph 20)

4.In response to this Report, the Department should provide us with the full documents described by Schools Week, a breakdown by category of the measures suggested by school resource management advisers across the country, how much the resource advisers cost, and an evaluation of the long-term value for money provided by their cost-saving recommendations. (Paragraph 21)

5.Publicly available data on school funding is extremely varied and subject to different calculations from a variety of sources. We are concerned this confusion can be exploited to portray a misleading picture. Having a single, reliable resource provided via an easily accessible official statistics publication would help resolve ongoing disputes over funding levels and how they are calculated. We are confident that the Department would welcome the additional transparency and public confidence that such a resource would bring. (Paragraph 25)

6.The Department should develop an official statistics publication for school and college funding. (Paragraph 26)

Core school funding

7.We fully support the intentions behind the National Funding Formula (NFF), and it is clear to us that maintaining a degree of local flexibility is important. We are nevertheless concerned that the so-called ‘soft’ formula continues to be based on local historical rates that perpetuate the anomalies it was supposed to remove. These historical factors hamper the NFF’s potential to act as a truly redistributive tool. (Paragraph 36)

8.The Department should bring forward legislative proposals to implement a ‘hard’ National Funding Formula for schools as soon as a parliamentary majority is available. We encourage the Department to investigate how best to address outliers whose individual circumstances might not be accurately captured by even the best-designed funding formula. (Paragraph 37)

9.Schools require an urgent funding increase. The age-weighted pupil unit (AWPU) funding in the NFF is set too low. (Paragraph 38)

10.The Department must raise the AWPU for the next spending review period. The Department must also commit to revising the AWPU again following a comprehensive review of the real-world costs of school education, as recommended in Chapter 7. (Paragraph 39)

11.The Department must ensure that multi-academy trusts (MATs) are properly held to account over their internal operations, the way they fund themselves, and how they distribute funding to schools within their trust. We are not convinced that the current framework is adequate. The Department should confirm in response to this Report whether, under a hard funding formula, MATs would continue to maintain discretion over allocating funds to schools within their trusts. If they would, the Department must explain how it intends to ensure this system does not undermine the NFF’s core aim of providing equitable and consistent funding across schools. (Paragraph 45)

12.Ofsted should be granted the powers and resources to conduct inspections at MAT level. The Department should also require MATs to publish detailed, accessible data on their website showing how they fund themselves, where this money comes from, and a breakdown of what it is spent on. These publications should be combined with performance indicators to support oversight by authorities and parents. (Paragraph 46)

Post-16 education funding

13.Post-16 education has been cut to the core. We note the Minister’s position about post-financial crash difficulties. Other sectors have however moved on. The continued underfunding of this pivotal stage in education is longer justifiable. These budget pressures are the result of political decisions that have had enormous impacts on young people’s educational opportunities and undermined attempts to tackle social justice. The Department must act urgently to address the damage that has been done. (Paragraph 59)

14.For the now overdue spending review, the Department must make the case to the Treasury for a post-16 core funding rate raise from £4,000 to at least £4,760 per student, rising in line with inflation. This is needed to ensure pupil services can be provided at minimum acceptable levels, and prevent institutions from having to cut back still further on the breadth of subjects offered. The Department must additionally commit to revising this figure following a comprehensive bottom-up assessment of cost requirements as outlined in Chapter 7. (Paragraph 60)

Social justice and tackling disadvantage

15.It is clear that Pupil Premium is being used to plug holes in school budgets rather than being directed at disadvantaged children. This is concerning but sadly unsurprising, given the financial pressure schools are under. Schools should not have to choose between running their core operations and supporting disadvantaged pupils. Ring-fencing Pupil Premium spending, or subsuming it under the National Funding Formula, will not fix the underlying problem that there is simply not enough money in the system. (Paragraph 70)

16.The Department should confirm that it does not intend to ring-fence the Pupil Premium or subsume it within the National Funding Formula. Additionally, the Department should investigate how the Pupil Premium distribution could be made fairer so that allocations match more closely the child’s level and duration of deprivation. (Paragraph 71)

17.The Department should review and revise the Pupil Premium compliance system, and in particular Ofsted’s role and oversight, to improve accountability whilst allowing flexibility for local-level innovation–for example via a more detailed measure of the performance of children from disadvantaged backgrounds. The Department should set out its proposed timetable for doing so in response to this Report. (Paragraph 72)

18.The Department should review options for an enhanced incentive system to systematically reward schools making good use of the Pupil Premium for evidence-based interventions that close the attainment gap whilst improving school results. The Department should set out the options and implementation plan in response to this Report. (Paragraph 73)

19.The intention behind Pupil Premium is laudable. However, the lack of take-up of free school meals means that too many deserving children are not receiving the support to which they are entitled. The Department must ensure that all eligible pupils attract Pupil Premium. (Paragraph 76)

20.The Department should outline in response to this Report whether it supports the principle of automatic enrolment for free school meals to ensure all eligible pupils receive Pupil Premium. It should additionally confirm what actions would be needed to introduce automatic enrolment, what action it has taken to overcome data-sharing concerns, and what actions it will take to ensure all eligible students receive their Pupil Premium allocation. (Paragraph 77)

21.In the meantime, the Department should publish detailed estimates of the amount of unclaimed Pupil Premium money, and the Treasury should pay this amount into a separate fund to be spent on disadvantaged students. (Paragraph 78)

22.We do not think Pupil Premium should stop at 16. We appreciate that there are some disadvantage funding pots available, but these are too small and spread too thinly. Disadvantaged 16–19 year olds are not less deserving of support than under-16s. They should not be treated as a lesser priority. Nor is it clear why there continues to be such a lack of data sharing between schools and FE institutions, which has led to disadvantaged students falling through the gap. (Paragraph 86)

23.The Department should introduce a 16–19 Pupil Premium scheme. The Department should additionally develop a data-sharing system to ensure FE institutions can identify disadvantaged students automatically. (Paragraph 87)

24.We were disappointed at the lack of adequate support for transport to further education institutions and apprenticeship workplaces. It is deeply disappointing that a clear manifesto commitment has languished between two departments, with little discernible sense of urgency to address the problem. (Paragraph 88)

25.The Department should provide in response to this Report an outline of its plans and timetable to improve transport support for 16–19 education. (Paragraph 89)

Special educational needs and disabilities

26.Special educational needs and disability funding is completely inadequate. There is simply not enough money in the system to provide for the scale of demand. Local authorities are expected to face a funding shortfall in excess of £1 billion by 2021. The post–16 sector in particular is having to deal with significant challenges in the context of enormous funding constraints. This is not sustainable. (Paragraph 105)

27.The Department must make the strongest possible case to the Treasury for sufficient funds to finance the widening high-needs deficit, projected to be over £1 billion by 2021, and address the underlying drivers of spiralling costs at an early stage. The funding uplift must include a thorough assessment of the cost implications of local authorities’ duty to maintain an Education, Health and Care Plan up to the age of 25. (Paragraph 106)

28.The Departments assessment of the core school funding uplift requirements must include a thorough analysis of the role that sufficient core school funding plays in facilitating early intervention and avoiding more costly interventions later on. (Paragraph 107)

29.The Department should review and revise the high needs funding formula to ensure it is sufficiently responsive to changing needs. The factors and weightings in the formula should be amended to develop a more forward-looking approach that is less reliant on historical factors, and takes greater account of projected trends and requirements for financial flexibility. As part of this review, the Department should assess the extent to which notional budget allocations take sufficient account of future trends, and facilitate adjustments to the notional budget allocation methodology to make funding arrangements more forward-looking. (Paragraph 115)

Towards a solution – a ten year plan

30.A ten-year plan for education funding is essential. It would provide schools, colleges and the Department with much needed strategic direction and financial certainty. The short-termism and initiative-itis that characterises the Department’s current approach cannot afford to continue. We are pleased that Ministers recognise the value of our proposal. (Paragraph 136)

31.The Department needs to take political short-termism out of school and college funding by developing an ambitious ten-year plan. We suggest the funding model should involve a multi-billion pound settlement from Treasury, informed by a bottom-up assessment of the cost of delivering a quality education for all children and young people. The Department should confirm in response to this Report its intentions and timeline for doing so. (Paragraph 137)

32.The Department needs to be transparent about how much money is needed for the education system. It must conduct and publish a comprehensive, bottom-up assessment of what services and support schools and colleges are having to provide, the real-world costs of delivering these activities and meeting attainment expectations, and how these costs relate to current school and college funding provision. The outcome of this assessment must inform the funding package for the ten-year plan. (Paragraph 138)

Published: 19 July 2019