School funding

Autumn statement school funding boost: What you need to know

Just how generous is the funding boost? And what about support with energy costs? Everything you need to know ...

Just how generous is the funding boost? And what about support with energy costs? Everything you need to know ...

17 Nov 2022, 14:01

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A magnifying glass over money

Government has announced extra funding for schools today – in an unexpected move that will help ease some of the cost pressures faced by school leaders.

Here’s everything you need to know…

1. How much extra cash are schools getting?

Chancellor Jeremy Hunt said schools will get an extra £2.3 billion in 2023-24 and 2024-25.

But the Treasury documents say this is actually a £2 billion increase after the removal of compensation for employer costs of the Health and Social Care Levy is taken into account.

You can see the changes in core schools funding from what was announced at the 2021 school budget compared to the Autumn statement here:

2. This is good news for schools …

Compared to other spending areas – schools are relative winners.

The core schools budget will now rise by four per cent in each of the next two years.

Many in the sector were not expecting extra cash for schools. And leaders and unions have cautiously welcomed the money.

So kudos to everyone who spoke out about funding woes, it clearly cut through.

3. … but just how generous is it?

As Sam Freedman, a former government adviser, puts it: “Until we know what’s happening with energy prices, inflation and pay next year – we can’t be clear exactly how generous this is.”

We know that the pay rises this year cost the sector £1.3 billion – so it is enough to clear that. But we don’t know yet what the extra cost will be of any pay rises awarded next year.

Schools are also hit by other rising costs, and Hunt said today that inflation is forecast at over 7 per cent next year.

And a dose of reality needs to be added: given the austerity-driven cuts over the past decade or so – this extra cash will only restore real-terms, per-pupil funding to what it was in 2010.  

4. More energy support doesn’t look likely

Schools and other non-domestic energy users, including businesses, are currently able to receive help through the government’s Energy Bill Relief Scheme.

The scheme reduces rates to £211 per megawatt hour for electricity and £75 for gas between 31 October this year and 31 March 2023. 

But the government is reviewing what support they can offer beyond this date, saying it is “not sustainable” to continue supporting large numbers of businesses.

However public sector organisations will “not be eligible for support through the review”, meaning it is currently unclear if they will receive any support from April next year. 

If there is no support forthcoming, then this would leave schools facing a big hit in extra costs (although government seems hopeful that prices will drop next year).

5. Is the extra cash new, or just recycled?

In recent years, we’ve got used to the Department for Education making announcements about new investment to find out it’s just recycled cash from cuts elsewhere.

So where is this funding boost coming from?

As we said above, £300 million is money that was already committed to pay for the health and social care levy (which has since been axed). Rather than take it back, as schools no longer need to pay they levy, the DfE will keep the money.

But the additional £2 billion is new money coming into the DfE – it won’t come from cuts elsewhere in the department.

However, the Institute for Fiscal Studies says the new money comes “in large part” from ”recycling £5 billion previously earmarked for increasing overseas aid spending to 0.7% of national income (instead, it will remain at 0.5%)”.

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