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Labour's great funding swindle

A secret memo confirms huge cash promises are not going to be honoured. Jon Slater and William Stewart report.

SCHOOLS will get less than a third of the extra money ministers promised them, even if councils pass on funding in full, a leaked government memo reveals.

The document obtained by The TES, was sent by the Department for Education and Skills to Number 10 Downing Street because of the Prime Minister's growing alarm over the funding crisis.

As Charles Clarke, the Education Secretary, today prepares to name and shame councils for not passing on money, it shows that the "record investment" in education promised by Chancellor Gordon Brown last year is little more than a mirage.

It also contradicts claims made by David Miliband, schools minister, in Parliament on Tuesday that this year is "unique" for schools because of tax rises and pension increases. In fact, unless extra money is found, rising costs and further cuts to direct grants will mean schools will face the same problems next year, the memo says.

The crisis has prompted serious questions to be asked about Mr Miliband, Tony Blair's former head of policy. Within government, questions are being over why funding problems were not spotted earlier. There are also question marks over whether Mr Miliband has fully got to grips with his job.

Tony Blair faced embarrassing questions over school funding at his monthly press briefing this week. He tried to pin the blame on councils for refusing to pass on pound;500 million to schools.

At Prime Minister's questions on Wednesday, he said: "I accept that there are problems for particular schools in particular local education authority areas." But he still blamed local authorities.

However, the memo shows for the first time that ministers accept councils are not solely to blame.

Even if all the extra money intended was passed to schools, rises in teachers' pay, national insurance and pension costs mean they would get an average increase of just pound;26 per pupil this year.

This rise - put at 1 per cent by the memo but significantly lower according to TES calculations - contrasts sharply with ministers' promise of a minimum increase after inflation of 3.2 per cent for each local education authority. No authority got a rise of less than 3.2 per cent but the memo reveals that "the 3.2 per cent floor is a little less than what schools would need to meet all the pressures they face".

A survey of 700 schools in England by the National Association of Head Teachers shows barely a quarter got real-terms increases this year. David Hart, general secretary, said: "This funding crisis has a potential for a major political explosion. Even if you can demonstrate some councils behaved badly some of the time, you can't demonstrate all behaved badly all the time."

Graham Brady, Conservative education spokesman, said: "Many parents, many teachers and headteachers regard this crisis of school funding as perhaps the grossest betrayal which the Government could have perpetrated."

On Wednesday, heads from Barnet in north London presented Mr Blair with an 18,000-signature petition in protest against budget cuts.

The Government has also come under fire for giving education authorities pound;15m to appoint teacher workload agreement "facilitators". A separate DfES memo also seen by The TES shows that all 150 English LEAs will get a share of this, including the City of London and Isles of Scilly which - despite having just one school each - still both receive pound;10,000. The National Union of Teachers called this "quite extraordinary".

Leader, 25

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