The real scandal in education is the inequality in schools’ funding

by Robin Thorpe

Education is widely regarded as the single biggest factor in lifting people out of poverty, it is also the most influential interaction that many people have with the state. Yet the way that schools’ funding is dispersed is not widely known and if the Labour movement is truly about breaking down inequalities then the huge disparities in funding across local authority boundaries needs to be acknowledged and changed.

Massive changes are currently being implemented to the way that schools are funded and these changes are being effected largely because of the extension of the academy system.

Most schools that changed to academy status in the last few years did so voluntarily and did so because they were offered the carrot of increased funding. This carrot will no longer be available to academies, as from 2013/14 all schools will have control over their entire budget.

The maintained schools still have their budget set by the local education authority  (academies receive their budget from the education funding agency), but all funds are now to be delegated directly to the school.

Under the current system the LEA retains part of the budget for maintained schools in return for providing core services such as payroll, CRB checks and contingency funding. The new system will see schools having to buy back into the service (or they can choose another provider).

This is part of a large (top-down) re-organisation of schools funding that seeks to remove local authority control over schools’ funding formula and replace it with a national funding formula (centralizing schools funding policy). The main reason for this seems to be that the EFA has to benchmark its funding formula for schools nationally and it can’t rationalize the differences between authorities to maintain parity for academy funding across county boundaries.

They are therefore seeking to simplify the system; however the system they are seeking to simplify is very complex. The current funding formula is based on actual school circumstances and has been developed over several years to direct funding to schools for a specific purpose; for example in Dorset there are several schools near army stations that have a number of children leaving and joining each year, this inevitably adds an administrative burden to these schools.

Under the new systems, larger schools will see a proportional drop in additional funding in order to protect the budget of smaller schools (this arises due to changes in the ‘block’ stream of funding, which was proportionate to school size but is now the same to all schools).

This has the consequence of providing less money per pupil at schools that have a higher pupil/teacher ratio; in addition larger schools tend to be in urban areas with higher levels of deprivation.

In my local area a particular infants School is set to lose £16,600, a junior school loses £20,000 and two secondary schools lose £70,000 although one other secondary school gains £60,000. In schools that are full to capacity they have to maintain standards while losing precious resources.

In general schools funding will be very turbulent over the short term as the department for education seek to move from locally accountable funding formulae to centralized budget setting.

However, the issues associated with this re-organisation are not the biggest scandal, that remains the extent of inequality in pupil funding across borough and county boundaries. This disparity cannot be blamed upon the current government, as these levels of funding were set several years ago.

The fact that they remained unchanged throughout the Labour government and will continue unchanged even though the coalition is working towards a national funding formula based almost entirely on pupil weighting (75%) is staggering.

In the academic year 2012-2013 a pupil in the London Borough of Tower Hamlets is funded at £8051.51; in Leicestershire a child is funded at just £4428.7.  The changes to the funding formula that are being forced onto schools by the department for education will not address this fundamental inequality.

It is instead likely that the proposed changes will adversely affect both maintained and non-maintained schools in the lowest funded authorities.

I know what you’re thinking; that surely the difference in funding is due to the increased levels of poverty in dense urban areas and that everything is more expensive in London. And to some extent this is true, education grants were allocated in the last decade to areas of deprivation and this was concentrated on cities. But, this doesn’t explain why the only maintained primary school in the authority that receives the highest funding is in a postcode where the IDACI score (Income Deprivation Affecting Children Index) is 0.05 (0 being affluent, 1 being extreme poverty). This school, the Sir John Cass School, is maintained by the City of London and they receive £9372.6 per child. You won’t be surprised to learn that the Sir John Cass school was rated outstanding by OFSTED.

Nearby Brook community school (maintained by Hackney – £7811.42pp) has an IDACI score of 0.512 for the postcode, ten times the score of Sir John Cass but qualifies for £1,500 less funding per pupil.

It is not only our large metropolitan areas that have pockets of poverty; old mill towns and pit villages, ex-fishing ports and rural farming areas all suffer from income deprivation. The IDACI score for the postcode of St Augustine’s primary school in Preston (maintained by Lancashire) is 0.518 but they only qualify for £4902pp.

Furthermore the ways that schools’ funding is formulated, schools receive extra money (on top of the average weighted pupil unit) for the number of children falling within each IDACI quintile and for children receiving free school meals (it is necessary to emphasize that the IDACI score is only a statistical probability and is therefore only an indicator).

Undoubtedly there is some allowance in the above figures for London-weighting but that doesn’t explain the difference of £900 per student per annum difference between the City of Leicester and Leicestershire County Council.

As the bulk of school expenses such as salary levels, energy costs, equipment and other resources are similar; it means there is a large variation in what schools can provide their children with.

For a class of 30 the disparity is £27,000 per year. The present funding formula has created large differences in cash levels between authorities and the gap has grown wider as annual percentage increases are added on. The national funding formula will not change this, as it is proposed to retain the historical values of the pupil unit.

The campaign for fairer funding is spear-headed by a pressure group called F40, comprising 40 of the lowest funded authorities. They state that

“F40 aims to achieve fairer funding for all pupils regardless of where they live so they can fulfil their individual potential. The ideal solution would be a revised allocation formula that ensures base entitlement per child that is sufficient to meet base needs, before additional factors such as deprivation and sparsity are factored in” “The best basis for funding academic excellence and also sustaining and supporting every child’s needs, is through fair and reasonable basic allocation.”

Discussions have been going on with various governments and departmental ministers for many years now; the Labour party (including former minister for education and skills the Rt Hon Ed Balls MP) is just as culpable as the Tories but it is time that it stopped.

How parity is achieved is profoundly contentious, which is why it hasn’t been done yet; however if the areas are truly deprived then the top-up they receive from deprivation factors should mitigate against turbulence. Surely now is the time to act? If there is to be a new national funding formula then it may as-well address the core inequities.

Robin Thorpe is a parent and a school governor and has never worked for the Labour party

Tags: , , ,

2 Responses to “The real scandal in education is the inequality in schools’ funding”

  1. Nick says:

    In the academic year 2012-2013 a pupil in the London Borough of Tower Hamlets is funded at £8051.51; in Leicestershire a child is funded at just £4428.7. The changes to the funding formula that are being forced onto schools by the department for education will not address this fundamental inequality.


    So lets cut Tower Hamlets and transfer the extra to Leicestershire.

    It’s inequality driven by government. Children in are being deprived, and its not in Tower Hamlets.

    I would go farther.

    8051.51 per child. Lets give 4,000 as an educational voucher to any parent to send their children private in Tower Hamlets. That way the school has more money to spend on the remaining children.

  2. Siôn Eurfyl Jones says:

    It needs to be stated that these changes apply only to England. Wales, Scotland and NI have more civilised values.

Leave a Reply