National funding formula: DfE proposes changes to ‘sparsity factor’ for small remote schools

national funding formula

Hundreds more small remote schools could be eligible for extra cash under government proposals to change the national funding formula.

But the money to fund the rise will be diverted from elsewhere in the overall schools budget.

A consultation on changes to the “sparsity factor” in the national funding formula from 2022-23 has been published by the Department for Education this morning.

The government is proposing a £10,000 increase in the maximum sparsity funding available, as well as changes to how it works out which schools are eligible.

Under the proposed changes, the maximum amount available in sparsity funding would rise from £45,000 to £55,000 for primary schools and from £70,000 to £80,000 for secondary schools. However, these are still lower than the £100,000 maximum that local authorities can currently allocate under the current “soft” implementation of the national funding formula.

Taken on top of the existing £117,800 lump sum handed to all schools irrespective of size, the increases in the maximum amounts means the sparse primary and secondary schools could attract up to £172,800 and £197,800 respectively through the two factors.

DfE wants to use road distances instead of ‘as the crow flies’

Sparsity funding is allocated for schools below a certain size and whose pupils live more than three miles from their second nearest secondary school or two miles from their second nearest primary. Currently, these distances are calculated “as the crow flies”.

The DfE is proposing that the distances be calculated based on road journeys from 2022-23, after finding that 1,123 schools are “no more than two-tenths of a mile below their respective sparsity distance thresholds in the 2021-22 NFF”.

The consultation document states that, had the road distance change been applied this year, it would have seen “approximately 900 more schools become eligible for sparsity funding”, which means 54 per cent of small schools would have been eligible, up from 30 per cent under the current measure.

The government is not proposing a change to the distance thresholds themselves, or the threshold for the definition of a small school.

Schools are eligible if they have an average year group size of less than 21.4 at primary level, 69.2 for middle schools, 120 at secondary and 62.5 for all-through schools.

Funding to come from existing school allocations

The government has allocated funding to councils based on the national funding formula for several years now, but town halls still have some freedoms in how they allocate the money. That will continue to be the case in the next academic year, though officials have said they remain committed to a “hard” implementation of the formula.

The DfE estimates that the changes to the measurement of distances and increases in maximum sparsity funding values would increase the total amount allocated through the sparsity factor from £43 million to £85 million.

However, the extra funding will be drawn from the existing funding allocation for schools, though the DfE said this would not have an “excessive impact on the increases that will be affordable to the values of factors concerning pupils’ characteristics” because the additional spend represents a “low proportion” of total schools funding.

“We think this achieves a good balance between better supporting small, remote schools, helping to ensure that pupils in rural areas have access to local provision within reasonable travel distances, while enabling us to continue to allocate the great majority of overall funding based on pupils’ characteristics to direct resources to those that evidence suggests require the greatest level of extra support,” the consultaton adds.

Total school funding is due to increase by £2.3 billion in 2022-23, following increases of £2.6 billion in 2020-21 and £2.2 billion in 2021-22.

However, leaders have warned that government promises and rising costs will eat up much of the £7.1 billion in additional funding pledged over the three year period.

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