CST outlines 4 reforms for ‘fairer’ school funding

Academy body calls for SEND cash through the national funding formula, a policy premium and new private finance building scheme

Academy body calls for SEND cash through the national funding formula, a policy premium and new private finance building scheme

17 Apr 2024, 9:00

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Government must revamp the national funding formula (NFF) to allow schools to provide the education “society expects”, the body representing England’s academy trusts has said.

Leora Cruddas
Leora Cruddas

The recommendations have been made by the Confederation of School Trusts as part of a report, released today, on reforming the funding system.

Leora Cruddas, CST’s CEO, said money needs to be distributed “in a way that reflects actuals costs and ways of operating in schools and trusts today”.

“If the English state school system is going to be the best system in the world at getting better, it needs funding that enables it to flourish, and that is what our proposals are aimed at delivering.” 

The proposals are based on delivering a fairer, more transparent and policy-led system.

Here are the four key policy recommendations…

1. Merge pupil premium into NFF …

The government currently hands out cash to local authorities based on its NFF.

The money is then given to schools based on each councils’ local formula, although more are moving toward mirroring the actual NFF.

However there is no end date to make all councils follow the national funding formula.

CST argued that leaders will “find strategic financial planning very challenging” if they are not given clarity over when funding will start to be sent directly to schools.

The body also said government should integrate “long-standing additional funding [channels] such as pupil premium” and the PE premium into the NFF.

They added a “transparent and informed annual settlement, uprated as necessary to reflect changes to workforce pay and pensions” would “reduce the impact of uncertainty”.

CST believes the government should identify the “real costs” of running a school by looking at MATs that pool funding and have carried out integrated curriculum and financial planning.

2. … roll in SEND cash too (with minimum funding level)

Another big shake-up is the call for government to “actively explore” rolling core funding for special school and AP into the NFF. This should be a “protected, minimum level of funding”.

The funding is currently based on place funding fixed at £10,000 for more than a decade.

To help inform this, ministers should draw on evidence from the safety valve programme, which helps council tackle SEND overspending.

The report suggested launching a vulnerable children impact assessment that would also “act as a reference framework for policy decisions – including funding”.

This would the “starting point” for decisions will be to consider effects on disadvantaged youngsters as well as those with SEND.

SEND funding bands should also relate to agreed provision, not a statement of need.

3. ‘Major national maintenance programme’

Pointing to the government’s previous condition reports that found £11.4 billion would be needed to repair England’s school buildings, CST predicted a “national maintenance and rebuilding programme” will have to be undertaken.

It suggested the money could be raised by ringfencing a “small percentage” of corporation tax income to raise £16 billion over two years.

But this would “would take significant political will … and presents justifiable arguments that the rest of the public sector requires investment too”.

Another suggestion is for ministers to “establish a new programme of private sector financing for the education sector that does not result in long-lasting expensive contracts which trap schools” in the way PFI deals did.

Its final solution is to allow existing public services – “including schools run by trusts, not local authorities” – to access developer contributions from housing schemes.

4. New policy premium

Any other, time-limited funding should come through a new ‘policy premium’.

This would mean the premium mechanism “becomes the only funding stream outside of the NFF … related to delivering provision.”

“Where a change is significant enough to last for several years, it should be embedded in the NFF,” the report added.

In 2010, a process was created that required all government departments to assess and fully fund any new burdens on councils from things like policy proposals, new duties and changes in guidance.

CST said a similar initiative for schools would be “reasonable”.

Responding to the report’s recommendations, Department for Education spokesperson said the government is “increasing school funding to £60.7 billion next year, the highest level ever in real terms per pupil”.

The NFF “ensures funding is distributed fairly, based on the needs of each school and their pupils, and that every school gets higher pupil-led funding compared to the previous year”, they added.

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