National Funding Formulae for Schools and High Needs — House of Lords, 2016-12-14
Topic: Education
John Nash (Conservative, Centre-right): My Lords, with the leave of the House I will now repeat a Statement made in the other place earlier today by my right honourable friend the Secretary of State for Education. The Statement is as follows: "Mr Speaker, with your permission I would like to make a Statement on the second stage consultation of the Government’s proposals to create a national funding formula for schools, copies of which can be found on the GOV.UK website. Since 2010, this Government have protected the core schools budget in real terms, but the system by which schools and high-needs funding is distributed now needs to be reformed to tackle the historic postcode lottery in school funding. These crucial reforms sit at the heart of delivering the Government’s pledge to build a country that works for everyone, not just the privileged few Our school funding system as it exists today is unfair, opaque and outdated. The reality is that patchy and inconsistent decisions on funding have built up over many years, based on data that are sometimes a decade or more out of date. What has been created over time is a funding system that allows similar schools with similar students to receive levels of funding so different that they put some young people at an educational disadvantage. For example, a school in Coventry can receive nearly £500 more per pupil than a school in Plymouth and a Nottingham school can attract £460 more per pupil than one in Halton, despite having the same proportion of pupils eligible for the pupil premium. As these figures demonstrate, our funding system is broken and unfair. We cannot allow that to continue Our overall proposals for the principles and broad design of the schools and high-needs funding system, as set out in the first stage of the national funding formula consultation by my predecessor, my right honourable friend the Member for Loughborough, were widely welcomed. Today, we set out our response to that and the next, final stage of putting in place a national funding formula First, we are proposing a consistent base rate for every pupil at primary and secondary, which steadily increases in value as they progress through the system between primary and secondary. This is the largest factor in the formula, accounting for more than £23 billion of annual core schools funding and over 70% of the funding total Secondly, we are proposing to protect resources for pupils who come from disadvantaged families and are taking a broad view to target £3 billion annually in funding for those most in need of support. Our formula will prioritise not only children in receipt of free school meals but those who live in areas of disadvantage, helping to support many more families who are most likely to be just about managing to get by. This is alongside our broader commitment to maintain the pupil premium for deprived pupils in full, which will be protected at current rates throughout the remainder of this Parliament. We have also listened to the responses received to the first stage of the consultation, so our funding formula will include a factor for mobility, reflecting the number of children who join a school mid-year. Respondents to the consultation from London called particularly strongly for this. We will also protect small, rural schools, which are so important for their local communities, by the inclusion of a sparsity factor Thirdly, alongside a basic amount and an uplift for disadvantage, we will be directing £2.4 billion in funding towards pupils with low prior attainment at both primary and secondary school to ensure that they get the vital support they need to be able to catch up with their peers. Our proposed reforms will mean that schools and local authorities all across England that have been underfunded for years will see their funding increase. Our proposed formula will result in more than 10,000 schools gaining funding and more than 3,000 of them receiving an increase of more than 5%. Those that are due to see gains will also see them quickly, with increases of up to 3% in per pupil funding in 2018-19 and up to a further 2.5% in 2019-20 At the same time as restoring fairness to the funding system, we are also building significant protections into our formula: no school will face a reduction of more than 3% per pupil overall as a result of the new formula, and none will lose more than 1.5% per pupil per year On high needs, which provides local authorities with the funding they need to deliver the extra support required by our most vulnerable children and young people, for those with the most extreme special needs, whether they are in special schools or mainstream schools, we propose allocating over £5 billion in funding a year. That will mean that no local authority area will see its funding reduce as a result of the formula being introduced. We also propose to give local areas limited flexibility to be able to redirect funding between their schools and high-needs budgets, through agreement between the local authority and local schools, to support collaborative approaches to provision for special needs pupils These protections will allow all schools and local authorities to manage the transition to fairer funding while making the best use of their resources and managing cost pressures, ensuring every pound is used effectively to drive up standards and have maximum impact for the young people we are investing in. In addition, to support schools in using their funding to greatest effect, we have put in place, and are continuing to develop, a comprehensive efficiency package As I said in my Statement to the House on 21 July, I recognise the importance of this reform. It is long overdue, and I am keen to allow the proper amount of time for all schools to have the chance to reflect on what is a detailed formula. The consultation will therefore be open for 14 weeks until 22 March, with final decisions to be made before the summer next year. It is our intention that once we reach a final decision, the national funding formula will be properly introduced in 2018-19. This will be a transitional year during which local authorities will continue to set local schools’ funding formulae, before we move in 2019-20 to our schools funding going directly to schools, so that the great majority of each school’s individual budget is determined on the basis of a single national formula It is now time for us to consult on the more detailed design of the formula so that, with the help of the sector, we can really get the national funding formula right. We are keen to hear as many views as possible, and I encourage Members and their constituents to scrutinise and respond to the detailed consultation documents The proposals for funding reform will mean all schools and local areas receive a consistent and fair share of the schools budget so that they can have the best possible chance to give every child the opportunity to reach their full potential. Once implemented, the formula will mean that wherever a family lives in England, their children will attract a similar level of funding—one that properly reflects their needs This Government believe that the funding system we are proposing will ensure our schools system works fairly, and I commend this Statement to the House".