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So-called increases prove a passport to nothing

Q) When does an increase in funding not necessarily mean more money?

A) When it is fed through the Byzantine mess that is England's school funding system.

This year's row is just the latest in a long line of funding spats which have seen headteachers watch in horror while ministers have blamed councils and authorities have blamed the Government.

At the heart of the problem is the fact that about half the education budget in England (and pound;4 billion of Gordon Brown's pound;12bn increase over three years) is dependent on local authorities' spending decisions.

While ministers talk about councils "passporting increases to schools", the reality is not that simple. Local authorities do not receive their education funding in a ring-fenced grant. Instead, they receive a lump sum which has to cover all services: education, social services, refuse collection and so on.

The figures ministers quote as LEA "education funding" are merely what the Government expects councils to spend.

As The TES reported in January, 13 authorities received an increase in their central government grant which did not even cover the extra they were supposed to give education, let alone meet the additional costs in other areas.

Despite these councils' protestations, the complexity of the funding system makes it relatively easy for ministers to blame them if schools do not get the promised money.

But it is not just councils who feel hard done by - ministers, too, have cause for complaint.

After protecting education budgets at the expense of other services during the lean years of the 1990s, councils have taken advantage of the system and siphoned off some of Labour's "record increase" for schools to repair the damage.

Local authorities still spend more than the Government expects on education, but the difference has shrunk rapidly in recent years, from more than pound;400 million in 19989 to pound;168m this year, according to the Local Government Association.

After losing pound;300m to other services in the past five years, it is perhaps unsurprising that education ministers took a new power which allows them to force councils to increase their spending on schools.

Education Secretary Charles Clarke is on weaker ground when he complains, as he has done vociferously in recent weeks, that councils have held on to too much of their schools' money for central services and administration.

It would be wrong to dismiss completely the concerns shared by both heads and the Government that by holding back a total of pound;500m, some LEAs are putting their own interests before those of their schools.

But LEA budgets given to the education officers' organisation, Confed, suggest that some of the councils that retained the most have a good excuse.

Much of the fabled pound;500m is either for government-promoted projects, such as the National Grid for Learning and numeracy and literacy work or, like money for newly-qualified teachers and emergency capital work, cannot be allocated until later in the year.

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