National formula shifting funding from deprived schools
The National Audit Office has found that a new national funding formula has contributed to a shift in the total amount of funding from more deprived schools to less deprived schools.
The Department for Education’s total funding for mainstream schools increased from £36.2 billion in 2021-15 to £43.4 billion 2021-21. However, the rise in pupil numbers meant real-terms funding per pupil rose by only 0.4 percent. The federal government plans to increase educational funding in 2021-22 and 2022-23, so total and per-pupil funding is anticipated to increase in real terms by around four per cent.
Between 2021-16 and 2021-20, cost pressures on mainstream schools were estimated to have exceeded funding increases by £2.2 billion, due to the fact of rising staff costs.
However, the Department for Education did not take account of the potential impact of coronavirus included in its assessment of cost pressures, and while it provided schools with funding noisy . stages from the pandemic for exceptional costs, and then in 2021 to assist schools cover costs as a result of staff absences, several stakeholders told the NAO this funding would be insufficient.
The Department for Education implemented a brand new national funding formula in 2021-19, meaning funding for schools has become allocated more transparently and consistently. It allocates three-quarters of faculty funding according to pupil numbers, and the remainder is based on factors concerning the characteristics of pupils and schools. Before 2021-19, local authorities received a per-pupil funding rate largely determined by the speed they had received in the last year. The government didn't calculate funding at school level or explicitly base funding on need, which meant similar schools in various local authorities could receive quite different funding allocations.
As area of the national funding formula, the Department for Education introduced a new minimum per-pupil funding arrangement. In 2021-21, the amount were set at £3,750 per primary pupil and £5,000 per secondary pupil. Underneath the minimum funding arrangement, 37 percent of the least deprived fifth of schools were allocated more funding in 2021-21. However, none of the most deprived fifth of schools were allocated an increase in funding as a result of this arrangement.
The NAO states that, under the national funding formula, more deprived local areas receive more per-pupil funding than less deprived areas as funding is related to want, but the difference has decreased. The primary causes of the relative re-distribution of funding between local authorities were the development of minimum per-pupil funding levels and alterations in relative need, like the proportion of pupils eligible for free school meals.
Between 2021-18 and 2021-21, average per-pupil funding within the most deprived fifth of schools fell in tangible terms by 1.2 percent, while per-pupil funding whatsoever deprived fifth increased by 2.9 per cent. As a whole, 58.3 per cent of the most deprived fifth of faculties saw a real-terms decrease in per-pupil funding.
Gareth Davies, the head of the NAO, said: “The Department for Education has met its objective of making the actual way it allocates school funding more transparent and consistent. However, it's less clear whether or not this has met its objective of allocating funding fairly. There has been a transfer of the balance of funding from more deprived to less deprived local areas. Although more deprived areas and schools continue to receive more per-pupil funding compared to those that are less deprived, the difference in funding has narrowed. The Department must evaluate whether this funding model is matching resources to want.”
