New funding formula details revealed by DfE official

5th February 2016 at 00:01
But disclosures about ‘fairer’ national system spark fears that there will be no real ‘winners’

Important new details about the first national school funding formula have been revealed by a senior government official. But experts say that they will leave even supposed “winners” disappointed.

Tony Foot, director of the Department for Education’s funding group, told headteachers at a conference in London last week that the long-awaited new formula was likely to be introduced over a five-year period from 2017-18, TES can reveal.

He said that there would be no new money available to cushion the blow for those losing out under the reform. But there would be a “minimum funding guarantee” to cap the amount a school could lose each year. 

Mr Foot also suggested that the biggest changes would be delayed until later in the five-year period. This means that few schools affected by the changes are likely to be satisfied. Schools currently in low-funded areas, which are supposed to “win” under the redistribution of money, would be unlikely to see significant gains in funding until the end of the decade.

Russell Hobby, general secretary of the NAHT headteachers’ union, said to TES: “The government could be in a classic bind where those that win from [the new formula] won’t win enough and it will move too slowly for them, and those that lose will lose too much and it will move too quickly for them.”

Jenny Lawrence, a Leicestershire County Council senior finance officer, told the conference that she did not believe the new formula would result in an increase in funding: “Being a low-funded authority, the expectation would be [of] more money, but I don’t think that is going to be the case.’”

Political fallout

Concerns were raised as it emerged that a previous attempt to reform the school funding system in 2014 stalled because of high-level fears that it would be politically damaging.

In a TES article to be published later this month, Liberal Democrat MP and former schools minister David Laws reveals that prime minister David Cameron referred to that formula privately as “Michael Gove’s plan to lose me the next general election”.

“The problem was quite simply that some areas would gain and many would lose,” Mr Laws writes.

This week, Chris Healy, the headteacher of Balcarras School, a secondary in Cheltenham – one of the lowest-funded areas – said that the extra funds may arrive too late for his school (see box, “We’re at risk of going bust”, above).

“Five years is a long time – it would take us beyond this Parliament and into the next one,” he said of his school finances. “Things are a lot more urgent than that.”

Details of a new funding formula have not yet been finalised and are due to be published for consultation in the next few months. It is thought that ministers are wary of releasing them in full before May as this could risk damaging fallout in the London mayoral elections;  it is expected that schools in the capital are likely to be hardest hit.

Speaking at a Capita conference in London last week, Mr Foot said that introducing a new funding formula for schools would be a “challenging process” but added that current arrangements were “still a long way from a system that in any objective sense could be described as fair”.

Asked whether it would take five, ten or 15 years to fully implement the new formula, the DfE official said there was “still a debate around that” but added, “If you were pinning me to five, ten or 15, I’d say five.”

Mr Foot said schools that were “outliers” – those with the very lowest and highest funding levels – might not move fully on to the new formula within five years.

‘No budget increase’

Asked whether there would be extra funding to implement the formula, he said: “The short answer is no. I don’t see any realistic prospect of [the budget] shifting over this Parliament in this spending review period.”

Simon Elliott, headteacher of Forest Gate Community School in Newham, East London, – one of the areas that is expected to lose out under the new formula – told TES that he was “not surprised” to hear that there would be no new money. He said that he was worried and was bracing himself for cuts of between 10 and 15 per cent over five years.

“The difficulty is that London schools have been doing well [academically] but it’s going to be hard to see that they will do as well as that with a significant funding cut,” he added. 

A DfE spokesman said: “This government is taking the difficult decisions necessary to ensure that the schools budget is protected, and has made significant progress towards fairer funding for schools, through an additional £390 million allocated in 2015-16 to 69 of the least fairly funded areas. We will consult on our proposals in due course.” 

‘We’re at risk of going bust’

Chris Healy, headteacher of Balcarras School, a secondary academy in Cheltenham, told TES last year that his school could face insolvency by the end of the 2017-18 school year.

Since then it has made major cutbacks, including a decision not to use cover for some staff on maternity leave and a £100,000 reduction in ICT spending, but it is not yet clear whether this – and any future cuts – will be enough to stave off crisis.

“We’re now entering into the unknown, living within ever-smaller budgets,” he says. 

Mr Healy says that further cuts are “the only way we can stop ourselves from going bust”, but that sources of savings are drying up.

“Other schools might be able to save by making teachers redundant. But we’ve already reached a minimum level of provision. If we made teachers redundant, we’d find it very difficult to cope without them.”


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