School leaders say £2bn more a year is needed to off-set real-terms cuts

Written by: Pete Henshaw | Published:
Image: Adobe Stock

The school funding arguments continued this week after the DfE unveiled its new-look National Funding Formula which included a real-terms per-pupil cash pledge. Pete Henshaw reports

The new National Funding Formula (NFF) for schools in England will not be enough to off-set the real-terms cuts that education budgets have seen in recent years, it was claimed this week.

After two public consultations, education secretary Justine Greening last week unveiled the long-awaited reforms to school funding set to be introduced from April 2018.

The changes are designed to iron out disparities in the old funding system which saw similar schools receiving vastly different amounts per-pupil.

Under the new system, primary pupils will attract basic per-pupil funding of £2,747, key stage 3 pupils £3,863, and key stage 4 pupils £4,386.

Every school is also to receive a lump sum of £110,000 to help with fixed costs, while rural schools will receive a further £26 million “sparsity” funding.

In a bid to protect schools where pupils do not attract as much funding via additional needs factors, there is an additional factor in the formula, which will provide a minimum per-pupil funding level over the next two years. For secondary schools this will be £4,800 in 2019/20 with a transitional amount of £4,600 in 2018/19, and for primary schools this will be £3,500 in 2019/20 with a transitional amount of £3,300 in 2018/19.

During the transition to the new system, local authorities will continue to set local formulae for determining individual schools’ budgets in 2018/19 and 2019/20 in consultation with schools in their area. However, from 2018/19 the schools block of the Dedicated Schools Grant (DSG) is to be ring-fenced to stop local authorities from moving funding between blocks as they have been able to in the past.

The Department for Education (DfE) says that the new funding arrangements also mean that, overall, local authorities will gain on average 4.6 per cent on their high needs SEND budgets.

Core funding for schools and high needs will rise from almost £41 billion in 2017/18 to £42.4 billion in 2018/19 and then £43.5 billion in 2019/20. The DfE maintains that this will be enough to maintain the schools and high needs blocks of the DSG in real-terms per-pupil up to 2019/20.

The National Funding Formula for Schools and High Needs states: “Every school will attract at least 0.5 per cent more per-pupil in 2018/19, and one per cent more in 2019/20, than its baseline. This goes over and above the commitment that no school will lose funding as a result of the introduction of the National Funding Formula.”

The government also claims that the most historically underfunded schools will see a rise of three per cent in per-pupil funding in 2018/19 and 2019/20.

However, while there has been general acknowledgement that the old system had to change, education unions have voiced their concerns that schools still face real-terms cuts.

While schools funding has been rising in monetary terms, increased costs including inflation, National Insurance and pension contributions, and staff wages mean that in real-terms budgets are under pressure.

In July, Ms Greening announced extra schools funding of £1.3 billion, although has faced criticism that some of this money is recycled from within the education budget.

The Institute of Fiscal Studies (IFS) has since reported that this additional funding will only serve to reduce the real-term cuts facing schools from 6.5 to 4.6 per cent between 2015 and 2019.

Geoff Barton, general secretary of the Association of School and College Leaders (ASCL), says that £2 billion a year more is needed by 2020 to tackle this threat: “The fundamental problem is there is not enough funding going into education. The £1.3 billion was a step in the right direction. But schools have already suffered huge cuts and the additional funding is nowhere near enough to prevent further cuts.

“And the £1.3 billion comes with the caveat that it is one-off funding split over two years, recycled from elsewhere in the education budget. Furthermore, the NFF does not deal with 16 to 19 funding which is set at an abysmally low level and is having a major impact on the education of students in sixth forms and colleges.”

Currently, the average sixth form student receives funding of £4,531 a year, around 20 per cent less than the average of £5,751 received by an 11 to 16-year-old secondary student.

Mr Barton added: “Setting minimum funding levels for schools is a welcome move, but we need to examine whether the levels announced by the secretary of state are sufficient. We fear they are still way too low.”

The NASUWT echoed this view. While recognising the “compelling ,reasons” for reform of the funding formula, general secretary Chris Keates called for “significant additional investment”.

The National Education Union, meanwhile, is worried that Ms Greening has made no longer-term funding commitment and maintains that while schools in historically underfunded areas may receive some extra money, “it will not be enough to protect them against inflation and other cost increases”.

Education unions are now calling on the government to use the autumn Budget statement to address the real-terms cuts facing schools.

However, Ms Greening said that the extra £1.3 billion over the next two years “means every school can gain”. In a statement to Parliament, she said: “Not only will the NFF direct resources where they are most needed, it will also provide that money through a transparent formula, providing greater predictability.”

The National Funding Formula

The new-look NFF, which is to be phased in from April 2018, is made up of four building blocks.

  1. Block A: Basic per-pupil funding will account for 73 per cent of the schools block. This will be ring-fenced and will attract £2,747 for primary, £3,863 for key stage 3, and £4,386 for key stage 4.
  2. Block B: Additional needs factors will be used to allocate 18 per cent of the funding and will incorporate deprivation factors for pupils on free school meals (including Ever6 FSM) and an area-based deprivation factor.
  3. Block C: School-led factors represent the remaining nine per cent of the allocation and include a fixed lumped sum of £110,000 for every school.
  4. Block D: Area cost adjustment funding will reflect the variation in labour market costs in different regions.

You can download the National Funding Formula for Schools and High Needs via


Please view our Terms and Conditions before leaving a comment.

Change the CAPTCHA codeSpeak the CAPTCHA code
Claim Free Subscription