Funding formula to go?

There are reports that the National Funding formula is to be abandoned. I received this from the Lib Dem press office just a few moments ago.

The Liberal Democrats have responded to reports that the Conservatives are to bow to massive backbench pressure and abandon their proposed shake-up of school funding.
Liberal Democrat Education spokesperson John Pugh said:
Finally, the Conservatives have been forced to re-think their deeply flawed funding formula, which would see savage cuts to schools in most areas of the country. Their proposals were utterly cynical, taking from some areas to give to others, rather than committing to give all schools the additional funding they need.”

I am surprised to hear this even being discussed during purdah as it amounts to a change of policy already under consultation.

Locally, if it proves to be true and not just electioneering, I am both glad for the rural primary schools, 100 of them in Oxfordshire, where the cash for the school was going to be cut (see earlier posts), but sad that Oxfordshire and the other F40 authorities will have to wait longer for a fairer distribution of funds to schools.

However, I am not surprised at the possibility of an announcement. Trying to reform school funding in the middle of the largest increase in pupil numbers in almost half a century was always going to lead to electoral disaster. One wonders why the Tories backbenchers waited until the day before the local elections to put on the pressure as any announcement has surely come too late to influence the voters in the shire counties voting tomorrow.

Then there is the issue of where the Conservatives now stand on funding schools? Unless they can come up with something better than just a U-turn on their formula they will still be leaving school looking at a funding shortfall over the life of the next parliament. Reciting the mantra of strong leadership on school funding just looks silly in the circumstances.

Finally, it doesn’t look like good government to change your mind in their way. There will certainly need to be some clarification of the government’s position. And, what next, a change of mind over selective schools?

 

Funding: the good years and the bad

The well-respected Institute for Fiscal Studies has today published a longitudinal study into the changing levels of education finance. https://www.ifs.org.uk/publications/8937

However, although factually accurate, as local authorities do still ratify the funding formula, the following statement early on in the report might be regarded as potentially mis-leading:

At the moment, it is local authorities that are responsible for determining the level of funding for state-funded schools. Each local authority receives a grant from central government, which it then distributes to schools in its area using its own funding formula.

After all, it is the Schools Forum, assisted by officers that decides on the local formula. Politicians, those that comprise the local authority, realistically now have no say in the matter, unless they are governors and elected through that route to the Schools Forum.

However, what the IFS have reminded us, at least in respect of schools, is that the 1990s were a period of funding constraint that lasted until the Blair/Brown leadership team took the brakes off education funding after their first few years of government when they were endorsing the Tory spending plans they had inherited in 1997: subsequently there was a period of increased funding as the new century unfolded. This allowed the creation of PPA time in primary schools and the growth in support staff numbers as well as generous spending on IT and improvements in pupil teacher ratios.

As this period coincided with the demographic downturn in pupil numbers, schools were relatively well funded, although the long period of decline in 16-19 funding commenced. The coalition supported school funding after 2010, but everyone now agrees that the next few years are likely to see reductions in real terms in school funding that will only be partially masked by increases in pupil numbers and any new national formula.

Even with tight floors and ceiling, there will be winners and losers with the new formula. This is partly because the gaps between the decisions on funding go way back into education history and are frequently associated with the municipal attitude to education and the size of the local tax base. When business rates were collected and spent locally, areas with good levels of industry and commerce often had well-funded education systems. As manufacturing and other industries declined, so did local funding and eventually business rates were nationalised. Successive governments missed opportunities to reform the basis of school funding preferring just to transfer the budgets to schools and away from local authorities and their politicians.

So, what happens now? If there is to be a period of austerity associated with cuts to funding to schools it is imperative that the cash is used wisely. But one person’s saving can easily translate into another’s burden. Close rural primary schools and someone has to pay for the transport of the pupils to another school. The same is true if small sixth forms are axed as no longer affordable. In the commercial world it is clear who takes decisions over cutting branches of banks or supermarkets that don’t pay. Who now decides on where schools are located: parents through the admissions system; the EFA as the national funding agency; MAT; Regional School Commissioners, but not presumably local authorities?

Many of the issues fudged when funding was adequate cannot be ignored when cash is being squeezed out of the system.

 

 

Scrooge or Santa: It depends upon where you live

My favourite line from the DfE’s consultation document on the new funding formula for schools is:

5,500 schools will benefit from the minus 3% per pupil funding floor protection.

I think that this is a line that the late, great, author George Orwell might have penned in either 1984 or Animal Farm. The real outcome of the government’s deliberations is definitely buried in the small print. An analysis of Oxfordshire primary schools shows an almost equal split between those schools likely to benefit and those that will be worse off. The division is stark between urban schools, especially those serving communities with high degrees of under-performance that will see more money, although some may be capped by the use of floor and ceiling mechanisms, and the small, usually rural schools that are almost universally losers. Of course, I welcome the extra cash for the schools that benefit.

In the secondary sector, around two thirds of Oxfordshire schools see gains, whereas the other third, again mostly the more rural schools, will see their income drop unless they can recruit more pupils to compensate for the reduced formula funding. As secondary schools are close to the bottom of the demographic cycle in many parts of the country the loss will be to some extent mitigated by opportunities to expand as pupil numbers increase. However, rural secondary schools, and popular schools already bursting at the seams won’t be able to increase pupil numbers. The same is likely to be the case for selective schools in some of the less well funded shire counties, where they are facing reductions in the examples presented by the DfE. As these schools often have little room for expansion, cuts to already poor funding levels won’t seem like a great Christmas present.

Overall, it looks as if the gains will largely be achieved by smoothing out the historical anomalies in authorities where the long-terml average has covered a wide range of different localities from those in the top decile of deprivation to those in the lowest decile. To achieve sufficient transfer of funds, there has also had to be internal transfers leading to the losses faced my many schools in the less well-funded authorities such as Oxfordshire. To some extent the use of floors will prevent the cuts affecting individual schools from being too great, but the use of ceilings may deprive some schools of the full amount indicated by the new Formula.

Of course, this isn’t a good time to be conducting this exercise. It would have been better for the Labour government to have undertaken the exercise a decade ago, when pupil numbers were in decline and funds were more generous. At that time all might have been winners and the government wouldn’t in some cases be looking like Ebenezer Scrooge..

Funding schools has always been a contentious issue, and this consultation may affect some Conservative County Council candidates next year if it looks as if a well-liked local school is losing funds and might even have to close. One can image the number of opposition candidates already looking out the ‘Save our Schools’ posters ready for the New Year.

A small tweak on the block grant might go a long way to protect many small primary schools where the expense of preserving them might be worth not having to pay the cost of providing transport to pupils required to relocate even before looking at the cost of building new school place sin the remaining hub schools in the market towns.

However, before the final step of either a local authority closing a school or a MAT throwing in the towel, there will be amalgamations and reductions in the number of head teachers, with one head probalby leading several schools in a cluster. That might work, but the NAO report earlier this week showed that it isn’t just the outcome of the funding formula that will determine the survival of lots of schools, it is also the many other cost pressures that they face. For a start, schools could be exempt from the apprenticeship Levy on the grounds that ITT costs already mean education is paying for the training of its professional workforce.

More money for grammar schools

What’s the point of a consultation if you know the outcome before you start? Opponents of grammar schools, myself included, must be asking themselves this question after yesterday’s Autumn Statement. The Chancellor announced:

5.13 Grammar schools capital – As part of the government’s ambitious plans to ensure every child has access to a good school place, the Prime Minister has announced plans to allow the expansion of selective education in England. The government will provide £50 million of new capital funding to support the expansion of existing grammar schools in each year from 2017-18, and has set out proposals for further reforms in the consultation document ‘Schools that Work for Everyone’

So, even if the response to the consultation was unanimous, the government has made provision to spend actually not £50 million a year as in the text, but £60 million a year over 4 years if you take the figures in the data tables. But, what’s £10 million pounds a year in a government budget of trillions.

Spend 0 -60 -60 -60 -60

Source: policy decisions document HM Treasury 2016.

Even that figure could be revised upwards. Now £60 million a year won’t buy you very many new grammar schools. Perhaps 5 a year for each of the four years funded, assuming the sites already exist and it costs £10,000 per pupil place for a 1200 pupil school. As most selective schools are in the South East, costs might be higher. It would be cheaper for a MAT to close an existing school and re-open it as a selective school, presumably something some MATs will already be thinking about. However, the statement specifically mentions support to expand existing grammar schools. Is this a smokescreen or won’t the money be enough to do more than add places to cope with the growth in pupil numbers and keep the percentage of the local population attending grammar schools stable rather than declining as pupil numbers increase? The answer isn’t clear.

The EFA already has a budget for new buildings, so presumably some of that could be diverted into building more selective schools instead of UTCs and Studio Schools that frequently don’t seem find themselves seen as successful schools on some performance criteria and aren’t always very popular with parents.

Those schools in poor quality buildings will rightly say that the £60 million could have been used to help far more pupils achieve a good standard of education through repairs than by spending it on encouraging switching from the private sector to a free grammar school place, as may well be the outcome of creating new grammar school places.

Despite the public statements about the economy, there seemed to be little new spending on education to help economic development in the FE sector in the Autumn Statement. Presumably, this will be left to un-elected LEPs (Local Enterprise partnerships) to bid for funds based upon the outcomes of the reviews held earlier this year.

 

 

Are small schools doomed?

The Association of School and College Leaders (ASCL) clearly worries that they will be. They have raised their concerns and the story was picked up by the BBC. http://www.bbc.co.uk/news/education-37860682 although I couldn’t find any press release on the ASCL web site that prompted the BBC story. Perhaps it is part of a campaign by teacher associations about the funding of schools?

As regular readers of this blog know, I have expressed concerns before about the future of small schools, especially if the block grant that underpins their finances is removed, possibly as part of a funding formula based on an amount per pupil. Such a funding system, perhaps topped up by sum for deprivation in a similar manner to the present Pupil Premium, has a beguiling simplicity about it; easy to understand and easy to administer: job well done.

However, such a top-down approach does have other ramifications. The most obvious is that for as long as anyone living has been in teaching higher salaries have been paid to teachers in London and the surrounding area. This is a policy decision that could be ratified in a new formula through an area cost adjustment as Mr Gibb said during his recent visit to the Select Committee when he appeared to talk about teacher supply. So, if a policy to support London, but not other high cost areas is acceptable, what about rural schools? As I mentioned in a recent post, on the 3rd October, some shire counties have a large number of small schools in their villages. Northumberland has some of the most expensive. Oxfordshire has a third of its primary schools with fewer than 150 pupils and the removal of any block grant would undoubtedly mean their closure, as ASCL pointed out.

Does a Tory government that has already upset some of its supporters in the shires over re-introducing selection to secondary education now want to risk their wrath over shutting the bulk of the 5,000 or so rural primary schools, not to mention small schools in urban areas? As many of the latter are faith schools this might also upset both the Church of England and the Roman Catholic churches, especially if pupils were transferred to non-faith based schools.

Councils might also be upset if the cost of transporting pupils to the new larger and financially viable primary schools fell on their council tax payers. After all, as I have pointed out in the past, children in London receive free transport to schools anywhere in the capital within the TfL area; this despite London being classified as a high cost area in which to live.

There is a possible solution, return to local funding models where communities can decide whether to keep small school open. Of course, it won’t be decided democratically through the ballot box, since local authorities still are regarded as not being capable of this sort of decision, even when run by Tory councillors. But, a grouping of academies in a Multi-Academy Trust could take such a decision or they could assume government policy on school size was reflected in the funding formula and close schools that cannot pay their way.

If you believe in the need for small schools linked to their community, now is the time to say so. To await any consultation on a funding formula may be to wait too long.

 

 

Time for a review of UTCS?

The news that yet more UTCs are struggling to survive comes after news of the over-representation of these schools at the top of the absence tables, as reported in a post last week. The idea of 14-18 schools specialising in science and technology together with the accompanying studio school concept for a wider range of subjects has merits, as their champions such as Lord Baker have always pointed out.

Sadly, the idea of depositing a cuckoo in the next of 11-16 and 11-18 schools in any area is fraught with difficulties. No schools wants to lose pupils at fourteen, unless that is they cost the school more to educate than they bring in as funding. Hence the struggle some UTCs have faced to recruit anything like a balanced intake, or in some cases an intake that would be large enough to make them financially viable.

As I reported earlier in the year, UTCs face extra running costs because they are delivering high cost subjects to largely examination age groups of pupils, but on a funding model that doesn’t take that fact into account. With the emergence of the now well documented problems across the sector, it is surely time for a review to decide whether to support the concept of a break at fourteen or engineer the existing schools back into the mainstream system to help cope with the rising secondary rolls over the next few years. Keeping open under-used schools while extra places are needed in the same locality is a waste of public money.

In many ways the 14-18 experiment is a good example of a market at work. Any new start-up venture has to compete with existing suppliers and often finds it a challenge unless they have the edge on design, price or technology. In this case, often despite spending lots of money on advertising, the 14-18 sector hasn’t caught the imagination of parents. Outside London the fact that parents that didn’t face any travel costs to send their children to school would have to pay if their teenagers moved to a UTC might well have been a deterrent that the government could have found a way around: possibly by encouraging the UTCs to fund buses from key centres.

If the UTCs are struggling to create a brand, then it seems likely that the studio school movement has even less definition and will only attract pupils where there is a strong local resolve to much such a school work. Nevertheless, there is merit in offering a fresh start at fourteen for some pupils, but the concept does need more thought. The involvement of the further education sector needs to be considered as part of any review, since colleges can offer an alternative structure for those seeking a curriculum post-14 that the average school cannot provide. Now FE is back under the wing of the DfE it should be easier to organise a coherent 14-18 offering.

However, any review might need to start by asking the question; at what age do we want specialisation to start? For if we want everyone to follow the same curriculum until sixteen, the need for separate schools after fourteen for some pupils is difficult to justify.

Now there’s a surprise

The new Secretary of State for Education has invented an updated variation of the Jo Moore outcome. This approach, readers will recall, was about issuing bad news on a busy news day so it didn’t receive much coverage. The current variation is to issue an important announcement at the end of a parliamentary term, either because you really need to say something or because it might receive less notice than at another time.

Anyway today’s announcement is the long awaited postponement of the second stage consultation on a National Funding formula for schools. http://www.parliament.uk/business/publications/written-questions-answers-statements/written-statements/commons/?page=2

The gist of the statement in a written answer reads as follows;

I will therefore publish the government’s full response to the first stage of the schools and high needs consultations and set out my proposals for the second stage once Parliament returns in the autumn. We will run a full consultation, and make final decisions early in the new year. Given the importance of consulting widely and fully with the sector and getting implementation right, the new system will apply from 2018-19.

All this is, of course, subject to whether there is a general election in the autumn. So, for 2017-18 and I assume for September 2017 for academies, it is business as usual based on the present funding regimes up to age 16. Presumably Schools Forums around the country will have to agree the formula to be used locally at a meeting early in the autumn term.

The delay in taking the concept of a national funding formula forward is frustrating to those authorities that might see an increase, but a reprieve for areas such as London that could be losers under the new arrangements. How schools will react is difficult to tell, but I suspect that where budgets are under pressure already, despite the guarantees for pre-16 funding, schools will take a cautious line, especially while post-16 numbers are still in decline.

So, is this a new Secretary of State acting responsibly or admitting defeat because it is just too difficult a challenge in the present economic climate where there won’t be enough money to buy off potential losers? Who knows, we’ll just have to wait and see what happens in the autumn.

By 2018-19 the growth in the school population will mean that for there to be any winners the Treasury is going to have to find more money for education. The Treasury is also going to have to accept that universities are already factoring in increases in student fees to £9,250 for 2017 and one step the DfE might take is to review why universities are charging the same amount for classroom-based subjects as for science and technology subjects. Anything they learn from that investigation might helpfully be considered in the light of the needs of UTCs that are funded at the same rate as other schools despite higher revenue expenditure, as I have pointed out before in this blog.

So should we thank the Secretary of State for putting everyone out of their misery for another year or attack her lack of willingness to move a challenging issue forward? Tough call, but not for under-funded schools in areas such as Oxfordshire.