The quango in charge of the finances of grant-maintained schools is backing a national funding formula - but is cautious about any move by Government towards payment by results, writes Clare Dean.
The Funding Agency for Schools warned that such a scheme could damage schools which are performing excellently given their pupils' background, in other words the institutions that are "adding value".
The FAS said it needed evidence that "output-related funding" would raise achievement and it believed payment by results could be introduced more easily into the post-16 sector.
The York-based body said exam results could be used to make a start on working out the value schools add. However it said: "Simply using a value-added measure could penalise schools which achieve excellent results at the end of key stage 4, at least partly as a result of their own endeavours."
The FAS said a national formula for GM schools would break the link with local authority spending .
It added: "The introduction of national funding would considerably improve the equity of school funding arrangements. We contend that the national funding formula should be constructed such that the relative needs of all pupils are treated equitably."