Warning over ‘cruel’ school funding ‘have and have nots’

MPs urge government to 'thoroughly investigate' regional divides

MPs urge government to 'thoroughly investigate' regional divides

Schools’ rising financial surpluses mask “cruel divides between the haves and the have nots”, MPs have warned.

The government must “thoroughly investigate” both regional divisions and the scale of cuts to subjects and staffing, according to a report by parliament’s Public Accounts Committee.

The cross-party group of MPs have made three major recommendations. Schools Week has the round-up …

1. Investigate regional divides

MPs say there is “significant variation” between different schools’ financial circumstances.

Dame Meg Hillier, the PAC chair, said the Department for Education’s “airy assurances about the healthy books of academies in particular mask some cruel divides between the haves and have nots”.

The department is accused of “blithely looking for laurels to rest on” by highlighting the fact that most maintained and academy schools are in surplus and suggesting the sector’s finances held up well overall. MPs had asked why one in 10 maintained schools are in deficit.

Official figures show some areas do not have a single school spending more than it receives, but others have as many as 46 per cent in deficit. In 26 areas, more than one in five schools are in the red.

Meg Hiller

The report says maintained secondaries face particular pressure. It recommended: “The department should thoroughly investigate geographical variation in the financial health of maintained schools, determine the underlying causes and decide whether some schools or local areas need extra support.”

2. Research scale of frontline cuts

MPs said the department had not carried out its own research into the impact of financial pressures on school provision, despite a 2019 Ofsted study highlighting cutbacks.

But the Education Skills and Funding Agency (ESFA) told MPs it will study the issue with a more representative sample of schools and the DfE has said it is monitoring subject teaching hours.

The PAC report states that this study must be published and include “sufficient reliable evidence” on local financial pressures, including whether staffing or the curriculum have faced cuts.

Geoff Barton, general secretary of school leaders’ union ASCL, said that it was not only PAC that is “frustrated by the DfE’s blithe insistence schools have never had it so good.

“Many school leaders have had to make very difficult choices about where to cut back over the past few years.”

3. Probe trusts with significant reserves

The committee has echoed a recent National Audit Office call for the government to probe academy trusts building significant reserves.

MPs noted that almost a quarter of trusts had reserves worth more than a fifth of their annual income in 2019-20.

“A significant amount of funding is not being spent on educating pupils currently in school,” they concluded.

Schools Week analysis found that some large trusts further shoring up finances in 2020-21, as Covid led to a reduction in bills as buildings were left empty as well as delaying infrastructure projects. 

The ESFA said it already challenges trusts with “excessive” reserves of more than 20 per cent and not held for specific purposes.

But MPs say it cannot do so effectively as it lacks information on whether reserves are earmarked for particular projects.

The PAC has asked for “details of the specific actions taken”, both within a month and again within six months.

Schools Week asked the ESFA for such figures and trust responses last month. But the freedom of information request was refused as government “does not hold a centralised record”. Issues are dealt with “on a case-by-case basis”.

Barton said PAC’s request was reasonable, but trusts needed reserves for “future needs”, such as capital projects.

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