More on the financing of education

One of the joys of moving house is unearthing long lost papers. One such that came to light during my recent house move was a paper on the finance of education I wrote way back in 1981. I think it was in preparation for a talk to students at the then Chelmer Institute of Higher Education where many teachers for schools in Essex and the surrounding area were still being trained at that time.

Anyway, the significance of the paper today is not its purpose, but rather in its contents. At that time, the Thatcher government was wrestling with an economic crisis that everyone thought was dire. It is true that one of its consequences was the collapse of large parts of the manufacturing sector, especially in areas such as the West Midlands, where, for instance, glass making in Stourbridge was replaced by new activities such as shopping centres and the car industry went into a long period of decline that seriously affected the western side of the West Midlands.

Education wasn’t protected during the economic turmoil of that period and there was the added complication that school rolls were generally in a period of decline. As a result, school budgets came under severe pressure. Just as now, local government spending bore the brunt of public expenditure cuts and at that time schools was a locally provided service. A survey of 31 local education authorities, as they were then, conducted by ‘Education’ magazine during May 1981 revealed where the cuts in expenditure were being made.

Expenditure item London Met Districts Shire Counties  
7 LEAs 8 LEAs 16 LEAs Total
Meals & Milk 3 1 12 16
Central Admin 1 2 8 11
Non-teaching staff 2 0 5 7
transport 2 2 1 5
Buildings & Playing fields 1 2 2 5
Capitation 2 1 1 4
Pupil Teacher Ratios 0 1 2 3

The first point to notice is how much the funding of schools has changed over the past 35 years. The second point is that teaching staff, as measured by worsening the Pupil Teacher Ratio (PTR) was only recorded by three LEAs out of the 31 surveyed as an option for cuts. Of course, some LEAs might have made cuts in previous years, and those authorities with elections in 1981 might have tried to protect the more obvious front-line aspects of education that parents would notice, such as increases in class sizes. But, despite falling rolls teaching staff as measured through the PTR was largely being protected in these LEAs.

However, I think the table may provide some pointers about what is likely to happen over the next few years to those schools whose budgets come under pressure. Of course, in the present world of devolved budgets, it won’t be councillors in the 152 local authorities worried about re-election taking the decisions on budgets these days, but heads and governors and the CEOs of MATs.

Nevertheless, I would be surprised if protecting teaching posts wasn’t still in a similar position in any table constructed in 2017. However, it might not be seen as quite as well protected as in the 1980s, since schools may be more prepared to cut optional subjects, especially at 16-19 than LEAs were in the 1980s.

It will be instructive to see how far MATs are prepared to trim back on central administration costs; surely an area for efficiency saving as LEAs identified in 1981. Do we need an index of central costs to school-based spending as was commonplace in the period when local authorities were being pilloried for retaining too much of the funding for schools.

Might we also see a return to hypothecated funding in areas such a professional development and IT spending as we have with the provision of free lunches to infant age pupils and funding for aspects of deprivation through the Pupil Premium and extra funding for children in care. This may be the only way to ensure any degree of uniformity of provision across a devolved funding system. Whether we should is another issue for another day.

 

 

School funding: Oxfordshire as a case study

A version of this article appear in the Oxford Times  newspaper of the 23rd March 2017

Why, when it has been generally acknowledged that state schools in Oxfordshire are poorly funded, has the government decided some Oxfordshire schools should lose even more of their income?  This was the conundrum facing those of us concerned about education in Oxfordshire just before Christmas when the government at Westminster announced the second stage of their consultation around a new fairer funding formula for schools.

Most of the secondary schools in the county stand to see an increase in their funding under the new proposals. That’s the good news, although it doesn’t extend to all the secondary schools in the county and the increase may not be enough to cope with the rising costs all schools face.

The really shocking news is the cuts to funding faced by the majority of the small rural primary schools across the county, especially those in the Chilterns, Cotswolds and across the downs. Although the cut is only a percentage point or two, it may be enough to create havoc with the budgets for these schools, especially as they too face general cost pressures through inflation and rising prices. Even the schools promised more cash, mainly schools in Oxford and the other towns across the county, won’t in many cases see all the extra money the government formula has assessed them as being entitled to receive. This is because the government has proposed a ceiling to the percentage increase any school can receive. A bit like saying, ‘we know we are paying you less than you deserve, but we cannot afford the full amount’.

I had anticipated the new formula was likely to bring problems, so tabled a motion at the November meeting of the county council to allow all councillors to discuss the matter. Sadly, the meeting ran over time and my motion wasn’t reached. Hopefully, it will be debated in March*, although that is just a day before the consultation ends. There has been no other opportunity for councillors to discuss the funding proposals. Parents and governors of schools should respond to the government’s proposals

I support the retention of small local primary schools where children can walk or cycle to school and the school can be a focal point for the community. It seems this model isn’t fashionable at Westminster, where larger more remote schools serving several neighbourhoods seem to be what is wanted. I know that retaining small local schools looks like an expensive option, but there are also benefits to family and community life by educating young children in their localities.

Were the local authority still the key policy maker for education, I am sure there would be a local initiative to the preserve the present distribution of schools by driving down costs. In a recent piece in this paper, the head teacher of Oxford Spires Academy specifically complained of the cost of recruitment advertising. Three years ago, I helped a group found a new free job board for schools that uses the disruptive power of new technology to drive down recruitment costs for schools. TeachVac www.teachvac.co.uk now matches jobs and teachers throughout the country for free at no cost to teachers or schools. We need innovative thinking outside the box of this sort in all areas to help sustain our schools in the face of government policies that threaten their very existence.

Across the county, all schools, whether academies or not could collaborate to purchase goods and services needed, whether regularly or only once a year.  This common procurement idea is much easier when academy trusts are headquartered locally. It becomes more difficult when their central administration has no loyalty to Oxfordshire. May be that’s why local academy chains have been more restrained in their executive pay than some trusts with a more limited local affiliation.

Cllr John Howson is the Lib Dem spokesperson on education on Oxfordshire County Council and a founding director of TeachVac http://www.teachvac.co.uk. He is a visiting professor at Oxford Brookes University. 

*The motion was debated and passed without the need for a formal vote. Councillors from all Parties expressing assent.

Funding takes centre stage

The launch of a report by the Education Policy Institute about the new government funding formula seems the have unleashed a renewed interest in the proposals, at least the proposals for schools, if not for the SEND High Needs block. https://epi.org.uk/report/national-funding-formula/ Even the, soon to be Osborne edited, Evening Standard had an editorial about the funding of schools in yesterday’s edition.

The issue about school funding breaks down into two quite separate parts. Firstly, is the formula an improvement on what has gone before and secondly, is there enough money for schools and education in general. The answer to the latter is a resounding NO from almost everyone.  Hamstrung as it is by the-U- turn on increase in tax on the self-employed the government could have found a fig leaf to offer schools, such as abolishing the apprenticeship levy as the education budget already pays for teacher trainees; they could be re-badged as apprentices and it would at least help reduce taxation on schools facing NI and pension increases this year. The government also look guilty of breaking another manifesto promise. The 2015 General Election Conservative Party manifesto said:

“Under a future Conservative Government, the amount of money following your child into school will be protected. As the number of pupils increases, so will the amount of money in our schools. On current pupil number forecasts, there will be a real-terms increase in the schools budget in the next Parliament.” (Bold added by me)

On the first question about the new formula, the answer you receive will depend upon who you ask. Most of London loses and is unhappy, many urban areas outside London see gains, but these are capped and the picture in the rural areas is confusing: some win, others such as Oxfordshire have many schools that are losers. Thus, few feel really satisfied, especially when looking at the overall financial situation for their school over the remainder of this parliament

Part of the problem might be that civil servants don’t seem to have fully road tested the formula. Did Ministers allow them to? But, can we afford to close small secondary schools in the Yorkshire Dales; in Shropshire and no doubt in some other rural counties? The notion of rural seems different when decided at Westminster than when viewed from a county hall. In this lies the dilemma: in a national service, how much local discretion do you allow? Apart from rural schools, separate infant and junior schools will largely become a thing of the past under this new formula, as will small faith schools, many in urban areas on restricted sites that don’t allow them to expand. Is this what the government wants? Are large schools regardless of distance from a pupil’s home what is needed for efficiency in a time of austerity?

Why is the proposed formula slanted towards secondary schools when the Pupil Premium is primarily aimed at primary and early years’ pupils? What is the point of such a weighting for deprivation being different between the two funding streams? The period between now and the close of the consultation and what happens afterwards will be an interesting time.

 

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.

 

 

The place of people and technology in learning

Last August I wrote a post called ‘Back to the future’ where I discussed a story then doing the rounds about a possible apprenticeship route into teaching. (blog post 22nd August 2016) In the post I discussed Physics as a subject where recruitment challenges might require a new look at how we recruit and train teachers. If you need a higher point score to study for a physics degree than say for a degree in another subject that then allows for entry into a teacher preparation programme, are we artificially curtailing the possible supply of new physics teachers?

This week the think tank Reform has published a study about the future shape of employment in the public sector up to say 2030. http://www.reform.uk/publication/work-in-progress/ Following on from the publication, the Head of Education at Reform tweeted on a twitter account I used last year during the Police & Crime Commissioner elections asking what the institute of Physics (IoP) response was to the apprenticeship route. Teachvac www.teachvac.co.uk (the free recruitment site) was copied in on the tweet, so it eventually reached me.

The answer, Louis, is that I don’t know what the IoP thought, as they didn’t comment to me. As Louis then noted in a later tweet, there is a site for apprenticeships in schools, but such apprenticeships currently only cover support roles. The article in a recent Schools Week about the a speech by the Secretary of State http://schoolsweek.co.uk/greening-promises-qts-wont-be-scrapped-and-7-key-findings-from-her-college-of-teaching-conference-speech/ suggests that any move to create non-graduate teachers won’t find much support. That doesn’t make the apprenticeship idea a non-starter, but calls for an innovative approach. The issue is partly about the minimum level of knowledge, both academic and practical, you need before you can work in a secondary school classroom and how this has changed over the past fifty years.

As the Reform report mentioned teaching and Teach First, there is more of a debate to be had about teaching. I expect Reform will come back to this issue. In one sense the debate is, as elsewhere in the public sector, and as Reform acknowledge, around the issue of teachers and technology. Reform’s thesis seems to be some work will be replaced by technology and jobs will change their skill levels so the number of workers can be reduced. Seen through the other end of the telescope, the views is of fewer, but more skilled workers each being more productive.  My example is the horde of market porters that have been replaced these days by the software engineers writing the code used in the automated warehouse: far fewer, but far more skilled and locatable anywhere in the world, as a recent BBC story about India showed.

With a largely highly skilled workforce in teaching, the issue at one level is, can the government afford to pay for such numbers of teachers as the 3-18 engagement with education demands? As we approach the 150th anniversary of the Liberal government’s requirement for universal state schooling available to all parents that didn’t provide any other form of education for their children there is a real need to debate both the shape and staffing of the schools during the next 50 years.

This was a point I made in my recent talk to the Merchant Taylor’s Company Education seminar (see blog post January 2017) Think tanks can provide a place to discuss new ideas and stimulate debate as can blogs. Is this a debate worth starting about the relative place of people and technology in the learning landscape?

 

 

Making money from schools

Why would anyone want to take the risk of running a ‘for profit’ school when there are so many easier way to make money out of state education? At one time, companies and foundations from the USA and Sweden were going to revolutionise schooling in England, while making a profit at the same time. Seems it didn’t happen quite that way. The academies that both the Erudition Schools Trust and the Learning Schools Trust opened have all been re-brokered away from the groups that originally founded them and now both of the groups are seemingly no more.

Another education experiment originally from the age of new Labour capitalism has bitten the dust. But, that doesn’t mean you cannot make money from schools. Books, furniture, resources, services such as accountancy, human relations, payroll and legal services, as well as construction and the maintenance of school buildings and facilities can all be offered at a profit. Then, as regular readers know, there is the recruitment industry that thrives on helping schools find staff.

Many years ago, in 1999 to be precise, the then Education Select Committee started an inquiry into ‘The role of private companies in the management and supply of state education services’. I don’t think it was ever completed.  I noted in my written submission that J S Mill had taken the view  in his essay  entitled On Liberty that the role of the state was to ensure the education of its citizens and not necessarily to operate the schools. The question was, and still is, how can The State achieve its end of educating its citizens without paying more of taxpayers’ money than is necessary?

The National Audit Office and the Public Accounts Committee are there to see that where possible public funds are used judiciously. I would say wisely, but I am not sure that is always the case. Mill, was convinced that the State should not necessarily run the service of education. But are politicians and these days, educationalists, any better at obtaining value for money if the service is run by others: sometimes not.

In 1999, I pointed out that the CEO of an education company with a turnover of £48 million earned £122,000 whereas a Chief Education Officer, remember them, of an authority with an education budget of more than £150 million didn’t even earn a six figure salary.  Presumably, the difference was the price to be paid for risk. You can find the same differentials today between CEOs of MATs and chief officers in local authorities, but with, in my opinion, less justification.

Some of us do try to challenge the orthodoxy, by taking the disruptive approach allowed by new technology. TeachVac www.teachvac.co.uk is one such attempt. Like Twitter, Facebook and many other on-line service sit is free to users and makes its money in other ways. In the case of TeachVac, analysing the growing amount of data and using it to provide additional paid services.

With growing concerns about school funding it is time to develop mechanisms for driving down private sector charges to schools. The government’s recent initiative in IT procurement is a good example of what can be achieved.

High Needs Block

Alongside the consultation on the national funding formula for mainstream schools there is a similar consultation for what is known as the ‘High needs’ group of pupils. This consultation has received far less notice than the mainstream NFF consultation, but is arguably as important for pupils with some of the most challenging of needs.

At the heart of the consultation is the central dilemma facing education in England. Who makes the decisions? The new formula proposes placing a great deal of responsibility with local authorities, as at present. That’s fine, but it ignores the fact that free schools can be established where local authorities might not want them and existing schools can become academies and thus alter their governance structure in relation to the local authority.

The ‘high need’ special education sector has always been a complex area to understand. There are some that think the current proposals out for consultation show that even the government doesn’t fully understand the issues. For example, the government doesn’t seem to have a policy for the use of the often highly expensive independent sector for placements of children where there is a shortage of space or expertise in the state-funded sector. This can be a real burden on some authorities. However, the consultation, in as far as it addresses the issue, seems to opt for the status quo. It might have been helpful to have tried to work out nationally how this expenditure could be reduced without damaging the education of the young people.

The formula has also to grapple with the issue of providing enough places, even if not always filled, and how far to use a methodology where funding follows the pupils, as with pupil unit funding in the mainstream school formula. I am not sure the proposed methodology is going to work as effectively as it might be required to do so. I am concerned that it mustn’t persuade some mainstream academies to ditch existing special provision units leaving the local authority to figure out how to provide a high quality education for these children plus a possible increase in the local transport bill. Local authorities should be able to challenge, if not veto, changes in existing provision not part of a planned and agreed local arrangement, especially where the MAT has its headquarters outside of the authority’s area.

I am worried about the inclusion of IDACI as one of the formula factors. Taken together the total of formula factors seem slanted to special needs caused or exacerbated by deprivation. I understand the concept, but for an authority such as Oxfordshire with limited pockets of urban and rural deprivation, many of our children with high needs don’t live in areas where this factor will be a key determinant. However, those children still need the funding necessary for their education. A review of SEN transport, especially in rural areas and complex non-residential cases, might have raised some issues about planning.

Overall, this looks like a redistribution of the current funding envelope rather than a formula based upon an understanding of the complex needs of this group of young people. It is also a work in progress since the funding of hospital schools isn’t included. I hope when it is a full understanding of the needs of young people with both physical and mental health issues and their relationship with the hospital service is included.

If you haven’t yet looked at this consultation, please do so.