Knowing that schools spending needs to be tackled does not make the task any simpler. A tangled web of overlapping budgets and crossed funding paths makes it almost impossible to know where the cash is really going.
The Department for Children, Schools and Families is spending some #163;46 billion on schools this year. While much of this goes directly to schools, some - in the form of targeted grants and projects, and the funding for quangos - is diverted. Cash is funnelled to most state institutions through local authorities, which spent #163;38bn on schools last year. Again, however, this figure is top-sliced to provide central and administrative services. Sorting out the numbers is the next Government's first task.
The good news is that we have identified more than #163;6bn of schools' spending that could be cut, without damaging classroom education - in some cases probably even improving it.
Since on average 78 per cent of a school's budget goes on staffing, the "front line" will have to be pruned. A focus among policymakers on class sizes - one of Labour's five "pledge card" policies in 1997 - has fuelled a marked increase in staff numbers: there are 10 per cent more teachers and two-and-a-half times as many teaching assistants now than a decade ago. But it isn't clear that this has led to improved educational outcomes.
Data from the Organisation for Economic Co-operation and Development indicates that larger class sizes do not automatically lead to lower performance: Korea and Japan, for example, have bigger class sizes but do far better at maths, while Luxembourg, which has very small class sizes, has much lower reading and maths attainment than England.
It is teacher quality, not class size, which matters most. A major government-commissioned study by the Institute of Education found "no evidence ... that children in smaller classes made more progress in mathematics, English or science".
But the quality of a teacher has been proven to have a quantitatively marked impact on pupils' educational progress. This throws into doubt the rapid expansion in the number of teaching assistants. The Institute of Education and Ofsted have found that teaching assistants have a negligible effect on educational outcomes, and may in some cases even harm a child's education if they are used as a substitute for proper teaching time. The situation is worsened by nationally agreed pay and conditions, particularly the 2003 national workforce agreement that introduced protected "preparation, planning and assessment" time for teachers and the "rarely cover" arrangements. In some cases, this has led to poorly qualified teaching assistants taking whole classes for prolonged periods, according to a government study.
Some assistants no doubt help in the classroom, but the evidence suggests they offer poor value for money. Over time, schools should seek to remove them from the classroom, saving #163;1.7bn a year at current rates and putting the spotlight back on quality.
This will mean tackling problems with teacher training, giving schools freedom to pay good teachers more and - importantly - re-professionalising teaching by reversing the removal of discretion and expertise.
Reforms should also seek to combat the huge amount of inefficient spending within schools. With a few shining exceptions, schools aren't very good at taking into account the impact of their strategic decisions on their finances. More than anything else, this is a cultural problem. Teachers go into teaching to teach; heads, who have usually ascended through the ranks of the profession, just don't regard value for money and resource management as a priority. This is the conclusion of the Audit Commission, which found last year that "weak" incentives and accountability were contributing to poor financial management in schools and identified at least #163;400m of savings in schools' procurement.
The spending binge of the past decade has left money sloshing around in the system to such an extent that infrastructure development has been allowed to run out of control. Capital expenditure per pupil has increased almost sevenfold in real terms over the past decade, largely due to the Government's Building Schools for the Future (BSF) programme. Some of this work was undoubtedly necessary but the continued emphasis on capital projects suggests more attention is being given to schools' buildings than what goes on inside them. BSF suffers from substantial excess costs and inefficiencies. Furthermore, it is simply not necessary to rebuild or refurbish every school in the country. BSF should be scrapped, saving a planned #163;2.3bn next year.
A range of other expenditures should also be confronted. A key function of education is that it is as an engine of social mobility; but are handouts to the most disadvantaged the best way to achieve this? Some #163;3bn, or a tenth, of the money central government gives to local authorities for schools is earmarked for tackling deprivation. Yet the Institute for Fiscal Studies reckons only about 40-50 per cent of the premium is actually passed on to disadvantaged pupils' schools by local authorities. The wasteful spending should be cut; whatever deprivation funding is maintained should go directly to schools. This could save #163;1.5bn a year.
In education, as in other areas of policy, the quangocracy should be scrutinised - including Becta, the National College, the School Food Trust and the Training and Development Agency for Schools. These bodies epitomise the attempts by successive governments to transform education into a tool for achieving social and economic change, instead of academic excellence. They should be scrapped or streamlined, saving a potential #163;158m a year.
Cutting this wasteful spending and stripping schools back to focus on what matters - educational attainment - will allow the education budget to be reduced while ensuring that schools' focus remains on quality teaching.
With a lighter touch from central and local government, the teaching profession can lead the way in boosting England back up the international league tables, securing a brighter future for the UK's economy, and its children.
Dale Bassett, Senior researcher at the independent think tank Reform www.reform.co.uk.