Revealed: Winners and losers on funding merry-go-round

29th April 2011 at 01:00
Many schools stand to gain from the Government's redistribution of the education budget - but an equal number are set to lose out, research by the NAHT and The TES shows. And the shock news is that 17,000 jobs will be lost

An accurate picture of how the Government's redistribution of the education budget will affect schools has been painted for the first time.

According to figures taken from a joint survey by heads' union the NAHT and The TES, in which nearly 1,500 headteachers and school business managers took part, this year's schools' settlement will lead to 40 per cent of schools seeing their budgets drop.

The numbers show that 35 per cent of schools will see a decrease in funding of up to 10 per cent, while a further 5 per cent - approximately 1,000 schools - will see a drop of 10 per cent or more.

But while some schools will see their budgets squeezed over the next 12 months, almost exactly the same number of schools are seeing their funding increase.

Overall, the coffers of 35 per cent of schools will swell by up to 10 per cent over the coming year, and a further 4 per cent of schools will see a rise of more than 10 per cent.

Just a fifth of schools will see no change at all to the funding they receive. Among the most striking findings is that some 17,000 jobs face the axe, with just 5,000 created by other schools. This will leave a net reduction of 12,000 jobs.

NAHT general secretary Russell Hobby said the drop in staff figures will "only get worse in the coming years" and added that the overall numbers "made sense" considering school spending had remained static this year. But he warned that poorer settlements were on the horizon over the course of the Parliament.

"It is not as gloomy a picture as I would have expected," Mr Hobby said. "What stands out is the symmetry of the figures. As the budgets are stable in real terms, for someone to gain, someone must lose.

"But what is very concerning is that 5 per cent of schools are losing more than 10 per cent of their budgets. They must be the schools which have been most affected by additional grants drying up from other sources."

Mr Hobby added that despite the Government's minimum funding guarantee ensuring that schools could not see a drop of more than 1.5 per cent in their budgets, in reality they are suffering far greater reductions, which the pupil premium is unable to redress.

The figures suggest the biggest winners are schools that have recently converted to academy status, and those that have seen a spike in their pupil numbers, particularly students on free school meals, which brings additional deprivation funding in the shape of the pupil premium.

According to a poll carried out by the Association of School and College Leaders (ASCL) last month, nearly half of secondary schools are considering converting to academy status, and of those that had applied 72 per cent said the biggest reason was the added financial incentive.

ASCL general secretary Brian Lightman warned that heads should be cautious, despite growing budgets, because they will need to fund services that were previously paid for through Government grants.

"We are hearing that the schools which are receiving more money, the ones that are protected, are the ones that are becoming academies," Mr Lightman said.

"The thing that people are not able to unpick yet is what they are going to have to pay for which was previously funded through separate grants. Schools, for instance, may decide they will provide careers guidance, but there is no funding for it so they will have to pay for it themselves," he added.

Similarly, further qualitative research undertaken by The TES, which anonymously questioned a cross-section of 20 headteachers, showed schools are applying for academy status either to boost their coffers or to make ends meet, following cuts to grants outside the Department for Education's schools settlement.

The winners and losers are illustrated by this research, which concludes that some secondaries - especially those with large sixth-forms - are losing out to the tune of over pound;100,000 and making teachers redundant, while others are receiving windfalls of more than pound;500,000 upon becoming academies.

But even some schools converting to academy status are unlikely to see a cash bonanza. Kingsbridge Community College in Devon has recently converted. Yet, despite the additional funding, principal Roger Pope said his school is unlikely to see its budget grow too much because Devon is the worst-funded authority in the country, and particularly because other, additional grants have been scrapped by the DfE.

"We chose to become an academy to be masters of our own destiny," Mr Pope said. "But there are obviously the financial benefits - it would be foolish to say otherwise. But those benefits will be very short-lived.

"Losing specialist schools money and the standards fund will mean we lose a quarter of a million (pounds); with other grants going it goes up to about pound;400,000 and that really hurts. If you put on top of that the spending on sixth-form is to be brought in line with FE colleges then it will have an impact," he added.

Other schools that have not opted for academy status have to work harder just to maintain their budgets, and the outlook for the coming few years is not good.

John Morgan, headteacher at Conyers School in Stockton-on-Tees, said his budget will stay roughly the same as last year and he will not be forced to let any staff go, but he said his budgets were "very tight".

"It is the added costs that make things very difficult," Mr Morgan said. "We still have to pay five-twelfths of the teachers' pay settlement, even though we haven't been funded for that by the DfE.

"On top of that there is the money we have lost from the devolved capital grant, which for our school was around pound;130,000 - that's a big loss," he added. "Then there are the extra services that schools will have to pay for on their own - it is going to become very difficult."

Speaking at the NASUWT conference in Glasgow last weekend, shadow education secretary Andy Burnham claimed school budgets overall will see a 1.1 per cent drop, while per-pupil funding will fall by 3.9 per cent over the course of the next three to four years, despite the Government's claim that per-pupil funding will remain unchanged over the same period.

"We are seeing the sort of poor decision-making and lack of clarity from central Government that can only be called incompetence - like the last- minute cut of pound;155 million from school budgets," Mr Burnham said. "This will mean schools losing money they have already been allocated in the middle of an academic year - or facing an even tighter financial settlement next year."

The Labour MP was quoting figures from research undertaken by the House of Commons Library at his behest, which adjusted the forecasted real-terms figures to be in line with the Office for Budget Responsibility's own March projections, which take into account inflation.

But the Department dismissed Mr Burnham's claims and pointed to its consultation on introducing a single national funding formula to remove the current anomalies that see similar schools in different areas receiving funding that differs by pound;1 million to pound;2 million.

A DfE spokesman said: "We're increasing investment in schools by pound;3.6 billion over the next four years - protecting cash levels as well as putting money directly in heads' hands and cutting central bureaucracy to protect the front line.

"As this survey shows, the current school funding system is illogical, unfair and opaque. That is why we recently launched a consultation to address the disparities and inequalities within our current system."

While many heads will welcome a change to the way funding for schools is calculated, it will take time for any change to come about. Indeed, the buttons on many headteachers' calculators may be worn out as they try to figure out their budgets for the coming years.

But as the picture that has been painted by this survey illustrates, trying to predict how the cards will fall in the next three or four years is foolhardy. Until schools are told their cash settlements this time next year, heads and their staff will just have to sit tight, plan for the worst and hope for the best.

What earns a funding boost

The characteristics of schools whose budgets have increased:

  • Recent academy converter
  • High numbers of pupils on free school meals
  • Young teaching staff
  • Increase in pupil numbers
  • Local baby boom
    • The characteristics of schools whose budgets have decreased:

      • Aversion to academy conversion
      • Reliance on funding grants and specialist school status
      • Low free school meal numbers
      • Older staff on higher pay scale
      • Falling pupil numbers
      • Large sixth-form
      • Outstanding capital investments
      • Budget deficit brought forward
        • Source: TES research

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