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Nothing so common as luck

All schools could soon be funded by a national formula. Neil Merrick reports. The Government is planning to extend the common funding formula to more grant-maintained schools - while admitting it does not give the sector enough independence. It has advanced instead plans for a national funding formula which could eventually cover all schools.

Proposals to introduce a CFF for some opted-out primaries, as well as a larger number of GM secondaries, closely followed publication of a separate discussion paper on a national formula for all state schools outside local authority control. But there have been calls, from the GM movement and beyond, for all schools to be funded nationally.

Organisations have until July 5 to comment on the future of the CFF while consultations over a national formula, which would break any link between GM schools and local authorities, continue until September 23.

At the heart of the debate over a NFF is the question of whether it should attempt to be simple, but potentially unfair, or more complex and risk confusing school managers as well as the public. The CFF currently covers 383 GM secondary schools in 23 local authorities where a minimum of 30 per cent of secondary-age pupils attend opted-out schools. All GM primary schools and the remaining GM secondaries receive annual maintenance grants based on their former LEA's local management scheme.

Figures produced by the Department for Education and Employment estimate that under a proposed national formula, nearly 8 per cent of GM schools covered by the CFF would see their budgets cut by at least 10 per cent. More (10.7 per cent) would see them rise by 10 per cent or more.

These figures assumed that the formula would be mostly based on pupil numbers with some extra money allocated for fixed and variable costs, such as a head's salary and the number of children on free school meals. A small sum was also included for London weighting, but the calculation could be made far more complicated by taking further factors into account. Other variables include premises costs, pupil turnover and, to help protect small schools, size. Performance criteria, including exam scores, were proposed although these are unlikely to be met with much enthusiasm from schools.

Sue Nicholson, senior assistant secretary at the National Association of Head Teachers, accepts the Government is more likely to adopt a simple approach, which will at least mean that schools have a better idea of their budget farther in advance. "A simple approach will make it easier to collect the necessary data," she says. "But the major problem over a NFF is that something which is transparent and simple is not compatible with something which is sensitive to the needs of schools."

At its recent annual conference, the NAHT called for a national formula to fund GM and LEA primary and secondary schools. This also has the support of Cecil Knight, out-going chairman of the GM Standing Advisory Committee, who claimed GM schools might be worse off than local authority neighbours if only they were subject to a NFF.

But Stewart West, a finance officer at Calderdale Council who has closely studied the effects of the CFF, says funding changes normally work to the benefit of the GM sector. The CFF is based upon the standard spending assessment for schools in each local authority area, less a sum to cover services still provided by the council, the so-called "top slice".

GM schools in Calderdale have been covered by the CFF for three years. The council was initially forced to increase spending on education to its standard spending assessment (SSA), the amount the Government reckons authorities need to spend on education. But Mr West claims this still left LEA schools worse off than GM neighbours who were, in effect, paid twice over for some central services.

"Money for a NFF will have to come from somewhere and the only way the Government can do it is by top-slicing the authority's SSA," he says. "If they take too much money away, the amount left for LEA schools will be inadequate and more will be encouraged to opt out."

The Government is proposing to extend the CFF to eight more LEA areas, mostly new unitary councils, and pilot a primary CFF in three local authorities - Essex, Gloucestershire and Hillingdon.

Calculation of the CFF depends upon identifying the ratio of money which is spent on primary and secondary education in each local authority area. Primary schools may be keen to join the CFF in order to place pressure on the Government to divert money towards their sector.

But Mr West believes all GM schools may ultimately only be satisfied with a NFF. "Generally GM schools are happy to go into the common formula because they see it as a means of not being tied to spending decisions of the LEA. But once they get in, they realise they are still tied to LEA decisions, so they want a national formula."

The DFEE has suggested that a NFF might be phased in over five years, but Stephen Szemerenyi, chairman of SHA's LMS committee and head of Finchley Catholic High, a GM school in Barnet, London, points out that LMS was phased in over five years, and the potential financial upheaval of a NFF is likely to be far greater.

The formula, he says, should focus on core teaching activities but recognise varying costs in different areas, as well as factors such as pupils with special needs. "Schools are required to provide a service which gives all children an entitlement to the national curriculum. We need a minimum level of resources to be able to do that."

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