Labour faces funding rethink

9th May 1997 at 01:00
Bob Doe looks at the tough decisions facing the Government on local management

The new Labour Government may launch a total overhaul of local management and funding arrangements in schools. The Education Secretary, David Blunkett, was promising only days before the election that control of at least 90 per cent of schools' budgets would be handed over to schools, but government officials are expected to urge ministers to go through with the review of local management that the Conservatives had been planning.

Indeed, Labour may deem such a review essential if it is to deliver on its manifesto promise to raise standards.

Ministers will be urged to reconsider their commitment that local education authorities "will be required to devolve power and more of their budgets to heads and governors", particularly as Labour expects education authorities to play a bigger role in improving schools.

Labour's manifesto also promised that the funding system "will not discriminate unfairly either between schools or between pupils". This means the Government will have to reconsider funding arrangements for grant-maintained schools and the foundation schools due to replace them. Any proposed changes for 199899 would have to go out for consultation before the end of this term.

Mr Blunkett is committed to consulting GM schools, but many would face cuts if the Government brings their funding arrangements more into line with those of locally maintained schools. But the size of Labour's victory could work in their favour. The many Labour MPs with one or more GM schools in their constituencies may not be keen to explain to voters why such schools are losing two, three or four teachers, even if to do so would only put them on a par with LEA schools. Nor will the Department for Education and Employment want to lose money won from the Treasury in the past to promote opting-out.

Not discriminating between schools and pupils also raises questions about the funding of primary schools compared with secondary, small sixth forms compared with sixth-form colleges, and discrepancies in the amounts provided per pupil in schools that are similar but under different local authorities.

Mr Blunkett even promised the Association of Teachers and Lecturers earlier this year that he would review funding of experienced and expensive staff, to help schools to retain long-serving teachers. However, he is likely to be advised that funding according to actual rather than average salaries would benefit schools in middle-class areas with low staff turnover at the expense of disadvantaged schools which find it harder to retain experienced staff.

Labour also wants the DFEE to take a stronger lead in school improvement, reflected in the appointment of Professor Michael Barber as head of the department's new standards and effectiveness unit. This could mean taking even more money from local authorities to fund national initiatives. But this could further weaken the ability of local authorities to play a bigger role in raising standards. At present they can argue, with some justice, that their ability to do so has been undermined by local management and the shifting of funds from local inspection services to finance OFSTED inspections.

Authorities can also point to the desire voiced by some heads and governors - particularly of small primaries - for less delegation.

DFEE officials are keen to review the idea that all local authorities must delegate a minimum percentage, and to offer authorities more flexibility in their LMS schemes. Although this would appear to conflict with the 90 per cent promise, Labour was never explicit about what it was to be 90 per cent of, and there is plenty of room for manoeuvre within the arcane workings of school spending calculations to redefine what is included in schools' budgets.

Labour might be tempted to square these circles by allowing local authorities to raise more money. Though Labour was careful not to depict itself as a tax-and-spend party, its pledges related largely to income tax. It could still relax or abandon the capping of local authority budgets and allow councils to raise more money through council tax - especially from those in more expensive houses, who benefited hugely from the switch from rates - or by a return to local business rates.

Beefing up council spending powers could play an important part in reducing the inequalities between schools in different local authorities. It would also please Labour supporters and representatives in local government.

Local government representatives have long argued for the restoration of their ability to raise funds locally to offset the arbitrary aspects of the central grants system. How schools are to be funded in future could, therefore, depend as much upon the stand taken by Labour's "Iron Chancellor", Gordon Brown, and its new local government supremo, John Prescott, as upon David Blunkett.

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