Generous councils to lose funding

8th July 2005 at 01:00
Robin Hood stole from the rich to feed the poor. The Government is accused of doing the opposite. Jon Slater reports.

Schools in local authorities which have made education their spending priority will have more than pound;250 million taken away from them over the next few years, The TES can reveal.

Rural areas will be the big losers with counties losing pound;140m to London and other urban authorities which already receive more money. The redistribution is the result of a new funding system due to come into force in 2006-7 which will replace council spending on schools with a ring-fenced central government grant.

Critics warn it will mean some schools having to cut back, while those in other areas will receive a windfall.

One council official has described the policy as "a reverse Robin Hood effect".

But ministers hope that other funding changes, such as the introduction of a single standards grant and three-year budgets, along with their pledge to ensure all schools receive a per-pupil increase in funding will mask the effect of the changes.

Councils spending more than the Government recommends on education through higher council tax or reduced spending on other services will, in time, have the extra redistributed among other councils. Those who spend less than they should on education in order to keep down local taxes or fund other priorities will have their education spending increased at a faster rate.

An analysis of Institute of Public Finance statistics, carried out by Warwickshire council, shows that 90 councils that spend nearly pound;400m more than the Government says they should on education will lose out. The money will be transferred to the 60 authorities spending less. Overall, London will gain about pound;70m from the changes, about the same as metropolitan authorities. Unitary authorities will lose pound;20m.

The funding changes were set out in a government consultation paper published in February.

Although the Government has guaranteed that over the next few years, "all authorities (will) see a minimum increase per pupil on the baseline from the previous year", it made it clear that councils that spend above the amount expected will be given smaller increases.

Jeff Mann, Warwickshire director of education resources, said: "It is like the Robin Hood principle in reverse. It will take money off authorities who are struggling because they do not get enough government grant and give it to those who get so much they do not feel they have to spend all of it on schools."

Warwickshire estimates it will lose nearly pound;3m, or pound;36 per pupil, from its annual budget.

However, not all losers will be in the shires. The London boroughs of Camden and Kensington and Chelsea spend more than 9 per cent over the Government's expected sum.

The Department for Education and Skills refused to deny that councils which spend extra on education will, in effect, have that money taken away from them.

A spokesman said: "We recognise that some authorities currently spend above the level of the SFSS (expected level), and some spend below. The consultation document therefore proposed that the starting point for the new Dedicated Schools Grant should be what each authority is actually spending on schools at present - not the level of its funding."

* jon.slater@tes.co.uk

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