Funding latest: Primaries face £74,000 real-terms cut

Written by: Pete Henshaw | Published:
Image: Adobe Stock

New research is forecasting a real-terms funding reduction for all schools by 2019/20, with half facing budget cuts of between six and 11 per cent.

Primary schools face an average real-terms funding cut of £74,000 by 2019/20 – the equivalent of two teachers.

Furthermore, new evidence released this week shows that even with the introduction of a new National Funding Formula (NFF), every school in England is set to see real-terms cuts in funding by 2019/20.

The study by the think-tank Education Policy Institute (EPI) warns that half of primary and secondary schools face “large” real-terms cuts of between six and 11 per cent. This includes 880 schools that face losses of more than 10 per cent.

The report warns: “These estimated funding pressures amount to an average real-terms loss of £74,000 per primary school and £291,000 per secondary school. This equates to almost two teachers in an average primary school and six teachers in an average secondary school.”

The report is the latest piece of evidence to emerge warning of drastic real-terms cuts to school funding and has been published as the government’s second consultation over the structure of the NFF closed yesterday (March 22).

The current NFF proposals set out 13 factors spread over four blocks that would dictate schools funding under:

  • Block A: Basic per-pupil funding will account for 73 per cent of the schools block. The proposed values for each of the key stages are £2,712 for key stages 1 and 2, £3,797 for key stage 3, and £4,312 for key stage 4.
  • Block B: Additional needs factors will be used to allocate 18 per cent of the funding and will incorporate deprivation factors for pupils on free school meals, pupils who have been eligible for FSM in the last six years (Ever6 FSM), and an area-based deprivation factor – IDACI. There are six IDACI bands determined by data from the national deprivation index.
  • Block C: School-led factors represent the remaining nine per cent of the allocation and include a fixed lumped sum of £110,000 for every school.
  • Block D: Area cost adjustment funding will reflect the variation in labour market costs in different regions.

However, the EPI’s study – The Implications of the National Funding Formula for Schools – finds the NFF proposals look likely to shift funding away from the most disadvantaged pupils.

The report states: “The redistribution of the basic per-pupil amounts, the use of wider area-based measures of deprivation and the increased quantum of funding for pupils with low prior attainment means that funding actually shifts from the most disadvantaged pupils and schools towards the so-called ‘just about managing’ group.”

It reveals that while primary and secondary schools with less than 30 per cent of pupils on FSM are expected to gain on average around 1 per cent and 0.9 per cent respectively (an additional £275 million), secondary schools with more than 30 per cent of pupils on FSM are expected to lose 0.3 per cent on average while equivalent primaries are expected to gain just 0.4 per cent.

The report adds: “This equates to a net increase of around £5.6 million for the most disadvantaged primary and secondary schools, many of which will actually see reductions to their budgets.”

Furthermore, the most disadvantaged primary and secondary schools in London are expected to see an overall loss of around £16.1 million by 2019/20.

Despite these findings, the study concludes that the Department for Education (DfE) is “right to proceed with a new schools funding formula and that it has resisted pressure to skew funding significantly towards the lowest funded areas, which might have been politically convenient but which would have shifted significant amounts of money away from disadvantaged areas, where attainment gaps are large”.

But even schools that benefit from the NFF changes will be “unlikely” to see increased resource.

The report adds: “We estimate that once inflation and other pressures are taken into account, all schools in England are likely to see real-terms cuts in funding per-pupil over the next three years.

“In addition, many schools (around 5,000) may see further budget cuts after 2019/20 if the government fails to allocate more money to schools in the next spending review period and continues to converge schools towards the National Funding Formula. The DfE needs to give as much notice to schools of its plans beyond 2020 as possible.”

Co-author of the report, Natalie Perera – the EPI’s executive director, said that funding had been “inconsistent” for too long and so it was right to pursue “a more rational funding arrangement”.

However, she added: “The government needs to be clearer about its funding plans beyond 2019/20 to give schools time to plan for further changes in funding. If the DfE fails to secure additional funding beyond 2019/20, then it can only continue to deliver the new funding formula for ‘under-funded’ schools by making further, large, cuts to the budgets of over 5,000 schools.”

David Laws, executive chairman of the EPI, added: “A new funding formula is long overdue and given the clear and persistent attainment gap between the most disadvantaged pupils and the rest, the DfE is right to pursue a formula which targets a significant proportion of funding to disadvantaged pupils and those who need more support. As our analysis shows, however, the government may receive little credit from schools for these reforms – as even the schools benefiting from the new formula have their gains completely wiped out by other funding pressures.”

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