The government has rescued the National Funding Formula by the skin of its teeth.
The Education Policy Institute was clear that Justine Greening would need to give clarity over whether the National Funding Formula would be introduced in 2018 as planned, before parliament breaks for the summer recess. Today she gave that clarity, along with a welcome boost to the schools budget of an additional £1.3 billion in 2018-19 and 2019-20.
It means that the Department for Education will now put more money into the formula – it increases the basic per-pupil entitlement and allows gaining schools to do so at three per cent per pupil in cash terms each year for two years, while the remaining schools get an increase of 0.5 per cent per pupil.
But there are three issues.
First, while the original NFF proposals could have caused around half of schools to lose money, these schools will now gain 0.5 per cent per pupil over the next two years. While this means overall per-pupil funding will be maintained in real terms, the schools will still face inflationary pressures of just over two per cent by 2020, as the funding announced today only covers the next two years.
Schools may struggle to make the improvements in efficiency
Secondly, is the Department for Education able to deliver the new funding through its existing budgets? The secretary of state set out a number of areas from where she believes her department can make savings. Most striking is cutting £280 million from the free schools budget, including delivering 30 schools via collaboration with local authorities to meet basic need. This is striking given that only a year ago, we were discussing forced academisation and the end of the role of local authorities in education. It is however, unclear the extent to which costs are simply being transferred to those authorities.
Also, Greening announced a transfer of £200 million from the department’s “central programmes” to the core schools budget on the basis that it will have a greater impact “in the hands of head teachers”. But without further detail of what is being cut it is impossible to determine what the impact of his transfer might be.
Thirdly, what happens after 2019-20? With no commitment beyond that point, and none possible until a future spending review, schools will still face a level of uncertainty. Not only is that going to be a concern for school business managers and headteachers trying to add up their budgets, it is a hindrance to long-term resource and staff planning. Without the ability to plan ahead, schools may struggle to make the improvements in efficiency that ministers are often so keen to promote.
Natalie Perera is executive director and head of research at the Education Policy Institute