Schools Funding

(Limited Text - Ministerial Extracts only)

Tuesday 29th April 2014 Westminster Hall

[The Parliamentary Under-Secretary of State for Education (Elizabeth Truss)]

I congratulate my hon. Friend the Member for Worcester (Mr Walker) and the F40 group for the amazing progress that has been made on this campaign. As hon. Members have said, this long-standing issue is finally starting to be dealt with. It is down to the dedication of all right hon. and hon. Members who have attended this debate and made such eloquent contributions that we are finally making progress on this issue.

Many hon. Members have highlighted the idiosyncrasies and unfairness of the current system. I do not think that there is any disagreement about that. Our spending on education is the fifth highest in the OECD. We have protected the education budget during this Parliament, because we believe that education spending is vital for the future of our children and our nation. Nevertheless, this spending is not fairly distributed at the moment; it is unfair and inefficient. Unfortunately, this unfairness has been baked in over the years, so even when education budgets were rising significantly, it was not dealt with. We are playing catch-up at the moment, as was mentioned by a number of hon. Members, my hon. Friend the Member for Redditch (Karen Lumley) in particular.

My hon. Friend the Member for Worcester made the good point that the link between funding and attainment is not always clear, but that there is greater clarity in respect of those from the most deprived backgrounds. Of course, one of our main priorities as a Government is closing the gap between those on the lowest and highest incomes. We have a long tail of under-achievement in this country that has a profound impact on social mobility and our economy, and that is something that we are keen to address.

My hon. Friend the Member for Stroud (Neil Carmichael) referenced the report, “Unseen Children”, which highlighted the issues for children in rural and coastal areas in general. That is a major problem, and we need to deal with it.

My hon. Friend the Member for Thirsk and Malton (Miss McIntosh) talked about the issues faced in her constituency. I associate myself with her comments about the terrible tragedy of the dedicated teacher, Ann Maguire, in Leeds. I went to school in Leeds. My thoughts are with her friends and her family.

I am pleased that hon. Members have recognised that the Government have provided £350 million of funding. I cannot provide the hon. Member for Cardiff West (Kevin Brennan) with additional information about his parliamentary question, but it is significant that the Government have found this additional money. We recognise that this is a priority. We are vigorously pursuing a route towards a national funding formula, which is the right way forward, and we are pressing that case. This funding represents a step towards it.

[Mr Graham Stuart]

The consultation on how the £350 million is allocated closes tomorrow. It is difficult to comment once indicative allocations have been given, but is it a genuine consultation? Will the Minister consider points that have been made and, despite the political difficulties, ensure that that funding is distributed in the fairest way possible?

[Elizabeth Truss]

It is a genuine consultation. We will listen to representations, not just from today’s debate, but from discussions that we have had as a team with the F40 group. It is a difficult process, obviously. A lot of hon. Members mentioned the problems in moving towards a fair national funding formula.

A number of hon. Members mentioned that the longest journey begins with a single step. We have made that step. There are always issues with the way that a formula for minimum funding is decided; all sorts of aspects have to be considered in a formula, including sparsity, rurality, deprivation and attainment. There is no perfect formula. There will always be some local authorities that gain more and some that gain less, and even when we get to the holy grail of the national funding formula, that will be so. There has to be a formula. However, where the Government have had an opportunity to allocate new money, as with the two-year-old offer, we have allocated it completely fairly throughout the country, and done so on a per-child basis with an area cost adjustment. Where this Government have had an opportunity to allocate new money, we have done it fairly.

I am committed, as my colleagues are, to a national funding formula. It is incredibly important for equity, social mobility and for our long-term economic plan, as hon. Members have said.

I recognise the issues raised about the high-needs block and the perceived unfairness of looking at the schools block. There would be issues in looking at the entire block, as well. Because the whole situation is so complicated, with the schools block, the high-needs block and the early years block, we have taken it step by step, starting with the schools block. That matter has come through in the consultation and we will look at that.

I note the specific issues in Staffordshire, the East Riding, Leicestershire and Warrington. I agree with my hon. Friend the Member for Warrington South (David Mowat); I have seen excellent attainment in Warrington, at the Evelyn Street primary school, which I visited with him. It is a such an outstanding school that we are using it as a national case study of how to integrate early years into schools. Fantastic work is going on in Warrington, but that does not mean that Warrington should be underfunded.

I have also taken the point about the area cost adjustment, particularly about how that has benefited London authorities in particular. We have to reflect the cost of teacher salaries in different areas, but how that is reflected in the overall allocations will be under consideration in the consultation.

We have recognised sparsity, although a number of my colleagues do not think that we have recognised it enough. But it is recognised in a minimum funding level, with a grant being given per school.

I acknowledge points made about the rising costs faced by schools, whether teacher salaries or pension and energy costs. However, in difficult economic times, we have protected education spending in real terms, because we consider it a priority. The question about what we will do on education spending and the national funding formula is important for our respective parties, going forward into a future Parliament. I cannot fully announce our position on that today; we are still working on the plans.

My hon. Friend the Member for Hexham (Guy Opperman) said that he is pleased that we are going in the right direction. It is important to acknowledge that. This has been a long time coming. We have taken steps with the £350 million, although people may not think it has been allocated in an absolutely ideal fashion. There have been detailed discussions about the modelling used for the formula. This is probably a precursor to discussions that will go on about what a fair national funding formula will look like.

I also acknowledge the points made by my hon. Friend the Member for Cambridge (Dr Huppert) about the positive changes that we have made in Cambridgeshire, particularly with respect to the capital budgets there.

To summarise, we have made the largest step that we can in a single year by securing the additional £350 million funding, without creating major turbulence in the system, which is a danger of moving too fast in funding reform. There is not a perfect formula. The arguments will continue about what factors are most important and what really drives the costs in schools. The Department is working on better analysis of schools’ costs, so that we can ensure that a future national funding formula properly reflects the costs, such as attracting and retaining high-quality staff in rural areas. I commit to listening to representations.