Schools Update: National Funding Formula

Baroness Garden of Frognal Excerpts

Thursday 14th September 2017 Lords Chamber

[Baroness Garden of Frognal (LD)]

My Lords, I, too, thank the Minister for repeating the Statement, which on the face of it sounds extraordinarily good news. However, we have concerns that none of this money is actually new and is being taken from efficiencies and savings in the DfE budget. We have £420 million taken out of the capital budget, including £315 million from healthy pupils capital funding used to fund improvements in schools’ PE facilities. Surely, at a time when we hear of the concerns about children’s obesity, that is not a terribly wise transfer of money.

The free schools budget is also being cut. Three of the 14 planned new free schools will now be funded by local authorities. There is a sense about this Statement of robbing Peter to pay Paul. The National Audit Office estimates that it will cost £6.7 billion to return all school buildings to a satisfactory condition. Why is the Secretary of State pilfering from the capital budget to pay for the increase in core schools budget? If the Tories can find £1 billion for the DUP, can the Treasury please find some more money for schools?

The Government broke the pay cap on police and public sector pay, and yesterday they were unable to defend the cap on NHS staff pay. Will they now look again at giving teachers a pay rise above the 1% too, with the Secretary of State increasing the schools budget accordingly? The teaching profession faces a number of crises and shortages and, surely, a long-overdue pay increase would be most welcome to try to redress some of the iniquities in the system.

The Government have scrapped their plans to make private schools help out neighbouring state schools or lose their charitable status, which is particularly worrying at a time when we see state schools unable to afford building repairs and forced to cut back on resources for their students. In our earlier debate, we heard how there was much advantage to the independent sector in creative studies. Will the Education Secretary urge the Prime Minister to rethink her broken election promise as a matter of urgency? Does the Education Secretary not also think it deeply short-sighted to fund the core schools budget by cutting the capital funding for PE facilities? I have already mentioned this, I think: we know childhood obesity rates continue to rise.

The per-pupil funding for 16 to 19 year-olds in sixth forms and FE colleges has been frozen since the 2015 spending review. Now that the Government are pledging that per-pupil funding for schools will increase with inflation, will the Secretary of State make the same commitment to 16 to 19 year-olds? I repeat that we welcome anything which causes funding for schools to be fairer, particularly if it focuses on the more deprived children and areas, but I would be grateful for the Minister’s reply.

[Lord Nash]

I am grateful for the general tenor of support for our proposals. It may not surprise the noble Lord, Lord Watson, if I do not go quite so far as he wished in his dreams that I would but I will write to him in more detail about his points. The £5.9 billion is for additional needs, not high needs, and we have maintained the existing total that authorities are currently allocated. This funding will be maintained in 2018-19 and 2019-20, and rise in line with pupil numbers, but I will write to him with a more detailed figure.

There is a lot of talk about cuts but, as I think everybody knows, they are not actually cuts. They are cost pressures, which everybody has suffered from in the private sector and business. Schools are more than half way through those cost pressures, caused by things such as pensions. Well-managed schools do their budgeting extremely well and are managing to improve this.

We have a huge amount of advice available to schools—I have referred to our website before—with a lot of resources such as toolkits, benchmarks and comparators for them to look at. We have a buying strategy in place, as £10 billion of schools’ spend is on buying services. This is a bit theoretical and top level but our analysis reveals that if all schools bought at the cheapest prices available there would be considerable savings, probably over £1 billion. We have a big programme in place on that and it is true that our best-performing school groups on finance, the MATs, are also often our best performers educationally—and, sadly, vice versa—because those school groups have learned how to focus their resources on exactly the areas they want. They have thought through where they want to spend their money and drive efficiencies so that there is much more available for the front line. If I have not covered any other points and noble Lords feel that they would like me to, I will write to them.