School Funding

Thursday 5th November 2015 Westminster Hall

13:30

[Graham Stuart (Beverley and Holderness) (Con)]

I beg to move,

That this House has considered funding for schools.

It is a pleasure to serve under your chairmanship, Mr Walker, and, equally, to see so many colleagues from both sides of the House filling the Chamber on a Thursday afternoon. It shows the strength of feeling on fairer funding for schools and that many colleagues want to see a fair and just system.

I want to place on the record my thanks to the Backbench Business Committee for granting the time for the debate. The issue has support from more than 110 colleagues from both sides of the House; only a fortnight ago they signed a letter to the Prime Minister championing fairer funding for schools.

The premise of fair school funding awarded in accordance with a rational formula assessed on the basis of pupil need is a simple one and, one might think, uncontroversial. That statement, however, falls a long way short of the reality in England. The Association of School and College Leaders has calculated that this year the 10 best-funded areas will receive an average schools block grant of £6,300 per pupil, compared with an average of only £4,200 per pupil in the 10 most poorly funded areas. For a typical secondary school of 920 students, that equates to a budget of £5.8 million in the best-funded areas and £3.9 million in the least well-funded areas—a difference of £1.9 million in a relatively small secondary school.

[Sir Greg Knight (East Yorkshire) (Con)]

Is my hon. Friend aware that I have had a meeting with the Secretary of State for Education, my right hon. Friend the Member on Loughborough (Nicky Morgan)? She is of the view that the existing formula is wrong, is unsustainable and needs to be changed, and she is consulting on that. Does he agree that the Government should be congratulated on being prepared to look at the matter? Furthermore, does he agree that Conservative Members seem to be pushing against a door that is, if not fully open, certainly ajar?

[Graham Stuart]

I am delighted to hear that my right hon. Friend met the Secretary of State. The delivery of fairer school funding was of course a manifesto undertaking by the Conservative party at the most recent general election and, I hope, played a part in securing the majority that our party enjoys in this Parliament.

[Jesse Norman (Hereford and South Herefordshire) (Con)]

I congratulate my hon. Friend on securing the debate, on the extremely skilful way in which he has run this campaign over the past few months and on the levels of support generated. I come from a county that is one of the worst-funded areas in the country, so I take his point, but does he share my view that things are made even worse when the effect of the tight local government settlement means that schools have to bear additional costs, such as for transport, as well as the unfair funding formula with which they are already landed?

[Graham Stuart]

That will have meaning in many rural constituencies. Separately, as my hon. Friend knows, the Rural Fair Share campaign on local government funding, which it is my pleasure to chair, shows up the great disparities. An interesting point about fair school funding is that the issue is not about rural and urban; it is an entirely arbitrary, random and grossly unfair settlement. If we look at the F40 group’s proposals, Barnsley would be the biggest gainer, Sunderland and Leeds would be gainers, and other areas might do less well.

[Geoffrey Clifton-Brown (The Cotswolds) (Con)]

I, too, add my voice to the congratulations on my hon. Friend’s superb campaigning over many years and on getting this number of people to the debate. May I emphasise that the issue is one of basic fairness? Children in similar circumstances wherever they live in the country should get the same resources from the taxpayer. The sooner we move towards a national funding formula the better.

[Graham Stuart]

As I said, the issue should be uncontroversial, but because the discrepancies are so great any change will mean that money is removed from some schools and some areas. The losers will, understandably, fight and try to find an argument with which to defend what is fundamentally indefensible, because there is no rationale for it. I will go into that later in my speech.

[Kevin Foster (Torbay) (Con)]

: I, too, congratulate my hon. Friend on securing the debate. Does he agree that one of the stark differences between rural and urban is shown in a recent Public Accounts Committee report? It identified that funding for deprived pupils can vary by £3,000 per pupil because of the existing formula.

[Graham Stuart]

My hon. Friend is absolutely right.

[Daniel Kawczynski (Shrewsbury and Atcham) (Con)]

I am sure that my hon. Friend knows, from going around schools in his constituency, that when it comes to the sort of equipment that our schools have—whether books or insulation—and the facilities available for children, they are significantly inferior to those in other parts of the United Kingdom. That is simply not fair for the education of our children.

[Graham Stuart]

My hon. Friend is right. He makes the point succinctly.

[Alex Chalk (Cheltenham) (Con)]

Schools in my constituency, from All Saints’ academy in the west to Balcarras in the east, are facing significant pressures from rising wage bills and pension obligations. Does my hon. Friend agree that we need clarity not only on the principle of fairer funding, but on the programme? Only by knowing the timeline can excellent schools in Cheltenham and elsewhere budget for a secure future.

[Graham Stuart]

My hon. Friend is right. Of course it is difficult at a time of flat cash and increasing financial strain to carry out redistribution, but it is when cash is flat, and no additional above-inflation increase is coming, that the discrepancy between areas becomes more important. Although it is politically more challenging to redistribute when there is a tight cash settlement—that is why it is so important to show the weight of opinion in the House—morally and educationally it is more important to bring that about. That is why we have pushed so hard, and I am grateful that the Government have listened and are prepared to seize the nettle.

[Mrs Caroline Spelman (Meriden) (Con)]

My hon. Friend is right; there is not only rural-urban disparity, but urban-urban disparity. Two wards can be side by side, with identical socio-economic profiles, but have a big difference in funding. The fair funding situation can be aggravated if a pupil moves from one ward across the border into the identical ward, because they do not bring the additional money with them. Unlike in health, the money—apart from the pupil premium—does not follow the pupil.

[Graham Stuart]

My right hon. Friend is absolutely right. That, too, has been a feature of the system for a long time. It is, in a way, a separate issue. If a child from Hull, perhaps from a deprived area, moves to a school in my constituency, which neighbours Hull, rightly or wrongly the additional funding given for that child will not follow the pupil who crosses the border to a school perhaps only a quarter of a mile away—for example, in Bilton on the edge of Hull in my constituency. That, too, is an indefensible feature of the system.

[David Rutley (Macclesfield) (Con)]

I thank my hon. Friend for securing the debate. My hon. Friend the Member for The Cotswolds (Geoffrey Clifton-Brown) hit the nail on the head when he said that the issue is one of fairness. We have heard about the disparities, which are nowhere more stark than in a constituency such as mine. I represent a seat next to the urban area of Manchester, and in Macclesfield the discrepancies are huge. That causes real angst not only among teachers, but among parents and pupils. Does my hon. Friend the Member for Beverley and Holderness (Graham Stuart) agree?

[Graham Stuart]

I do agree. As a result, the children of a multi-millionaire in one constituency or area receive more funding for their education than do the children attracting a pupil premium and from one of the poorest families in a neighbouring area. That is indefensible. The discrepancies are so enormous as to require change, notwithstanding the political challenges and difficulties of doing so.

[David Mowat (Warrington South) (Con)]

There would appear to be consensus on the Government side, and perhaps on the Opposition side, that enough is enough. This is the third Westminster Hall debate I have attended on this issue since I became an MP five years ago—the first was in April 2012—and at each debate it has been agreed, including by the Government, that this had to be fixed. If the door is ajar, as my right hon. Friend the Member for East Yorkshire (Sir Greg Knight) said earlier, there would appear to be a wedge in it that is still to be removed. Does my hon. Friend agree that we must hear from the Minister about timing and not just about whether he agrees that the principle is wrong?

[Graham Stuart]

My hon. Friend is right and I hope and expect that we will hear from the Minister on when the House will get the detail about what the Government propose to do.

To bring to life the example I mentioned of a relatively small secondary school with 920 pupils, the £1.9 million difference between two such schools in different areas is enough to pay the total costs—salaries and pension contributions—of 40 full-time teachers. That huge funding gap cannot be justified.

The gap is not explained by pupil deprivation. People might think that the system is designed to give more to areas of concentrated deprivation, whether urban or other. In 2011, Department for Education analysis showed that a school with 43% of pupils eligible for free school meals can receive £665 less funding per pupil than a school with less than 10% eligible pupils. Therefore, a school that serves the most deprived, as opposed to one that serves a remarkably affluent population, can receive hundreds of pounds less per pupil simply because of where it is rather than the nature and character of the children concerned, let alone their needs. Given the flat cash settlement for schools since that time, those figures will not have altered significantly.

I will give another example of the disparity that can exist between authorities. A secondary school pupil in York who receives the pupil premium, which is worth £935 this year, still has less spent on his or her education than an equivalent pupil in Birmingham who is not eligible for the pupil premium. Therefore, the child of the wealthy entrepreneur or lawyer in Birmingham receives more than the child from the poorest home in York.

Colleagues have mentioned the cross-border issue. The same applies in the relationship between Nottingham and the county that surrounds it: a 13-year-old pupil in the city gets more for their education than a disadvantaged child from the county next door, even though that child receives a pupil premium. Indeed, it is worse than that: a child who is in care in a certain area of the country and receives the pupil premium plus, worth £1,900, to reflect their needs, will still receive less than the child of a wealthy lawyer in Islington. That cannot be right. It needs to be fixed in a timely way and that is what we are gathered here today to tell the Minister.

We might think that if the disparity does not reflect deprivation, perhaps it reflects underlying performance in the system such as the quality of education in the schools, with more money going to help those areas doing less well. However, that would be wrong. Some of the best performing areas, notably in London, continue to receive thousands of pounds more per child than areas that are really struggling with education outcomes. The Royal Borough of Kensington and Chelsea receives 39% more funding per pupil under the schools block grant than my own area, the East Riding of Yorkshire, which loses out badly under the current funding arrangements.

The East Riding struggles with many of the challenges identified by Ofsted Chief Inspector Sir Michael Wilshaw in rural and coastal areas of England, where it can be hard to recruit and retain high-quality teachers, and partnerships between schools can founder because of the distance between them. We could take a coastal town and ask, “Why can’t we replicate the London challenge in East Yorkshire?” but anyone who drew a circle around Withernsea in my constituency to find all the schools that might be able to provide mutual support would find that half the circle was in the sea and the other half took in a swathe of rural East Yorkshire. That does not create easy conditions in which to build the collaborative regimes that have made such a difference in London and that is a further reason why such areas need to be fairly funded.

Contrary to any lazy misconceptions that areas such as the East Riding are rural idylls, there are areas of deep deprivation. Withernsea ranked in the top 10% of most deprived areas in England on both the income and employment indices of multiple deprivation in 2010. In a devastating speech in 2013, Sir Michael Wilshaw warned that

“many of the disadvantaged children performing least well in school can be found in leafy suburbs, market towns or seaside resorts”.

The East Riding also faces the additional costs associated with needing to run small, rural schools because of its geography. There is a limit to how far we can expect children to be bused, so it needs to run small schools, which are necessarily more expensive. It therefore has higher natural costs, and greater challenges in delivering high-quality education.

On top of that, the East Riding targeted as much funding as possible at its schools. Various blocks make up the dedicated schools grant, and historically the East Riding chose to stick most of the money for special educational needs in the schools block—it was entirely free to do so. It said to schools, “Use your budget to deliver that.” There was practically nothing in the high needs block, because that money had been put into the schools block. When the dedicated schools grant came in, which was based on what had been spent at that time and how it was accounted for, the East Riding received among the lowest levels of SEN funding in the whole country. That was not because there was a lack of challenge, but because of how the accounting had been done.

Our high needs funding is now the lowest in England, so the East Riding has had to move funding over to try to compensate for that. The situation was unfair already. Then we moved to the £390 million the Government came forward with last year to help lower-funded authorities, but that was distributed on the basis of the schools block, one of the three blocks that make up the dedicated schools grant, and as my local authority had its money in the schools block and not the high needs block, it ended up receiving a very much smaller share of the cake.

[The Parliamentary Under-Secretary of State for Education (Mr Sam Gyimah)]

I thank my hon. Friend for bringing this debate to the House, and I look forward to all the contributions. He mentioned the £390 million that the Government put into schools’ funding to help make the funding formula fairer. I want to clarify that that has been done twice: it was done for 2014-15 and it is being done for 2015-16. We are taking, and have already taken, steps to make the funding formula fairer. In response to the point about timing made by my hon. Friend the Member for Warrington South (David Mowat), that shows our intent.

[Graham Stuart]

I am grateful to the Minister. I am also grateful for the £390 million, which was a significant amount to find to help the lowest-funded authorities. A method for distribution had to be found and, under his predecessor, a decision was taken on that, which led to certain discrepancies, though overall there was certainly an improvement.

[Jo Churchill (Bury St Edmunds) (Con)]

Bury St Edmonds and the broader area of Suffolk were grateful for that uplift. However, it took us from 121st to 116th. We are still £260 a pupil behind the national average, which means we are very far behind the schools with the highest funding.

[Graham Stuart]

I am grateful to my hon. Friend for that.

[David Mowat]

The Minister mentioned my point, so I want to come back on that. While the £390 million was welcome, it was not a change to the funding formula. We still do not have a national funding formula and, in fact, that £390 million affected Warrington much more poorly than the better-funded Westminster. After the £390 million, Warrington remains 11th from bottom of the 152 authorities. We will come back to that.

[Graham Stuart]

I am grateful to my hon. Friend. That is why we need a whole new look at this and a national funding formula. As a result of issues relating to the blocks that colleagues may or may not have followed—it is complicated—after the £390 million, the East Riding became the lowest-funded local authority in the whole country. Members can imagine the gratitude my constituents felt: the then Chairman of the Education Committee and leading member of the campaign for fairer funding had somehow dragged the East Riding from being the third or fourth lowest-funded authority to the very lowest. I had to put my hand up and say, a little plaintively, “Well, we did get £1.8 million more.” But relatively speaking, we fell to the bottom. We can all see why people were not very happy, and they would like to know that there was a rationale. Someone has to come bottom, but let there be a rationale for that.

If we cannot develop a rationale, we should put people on the same money. In the Parliament before last, the all-party group on rural services conducted an inquiry on health and education funding. Professor Mervyn Stone, emeritus professor of statistics at Oxford University—a marvellous man with a beard like a biblical prophet’s—said, “If you move to equal funding per pupil or per patient across the country, you’d have something fundamentally unfair, because of the variety of costs”—I hope I am not unfairly putting words into his mouth—but we would still have something far fairer than any of the structures that anyone has come up with so far, let alone implemented in Government. Equal funding would be fairer.

Our call today is not for perfection but for a significant move to close the gaps. It is worth saying to colleagues who represent London seats that some areas of London—a few, admittedly—would benefit from a new national funding formula. Under the recommendations submitted to Government by the F40 campaign, which is the group of lowest-funded local authorities, there would still be, on average, more than £1,000 more per pupil in London than in the rest of the country. Take a class of 30. Whether it is in London or Warrington, there will be a classroom, kids and a teacher, and there might be a support assistant. A school in London will have £30,000 more a year to run that. Costs are higher in London, but not that much higher. It has to be right to move to something that is fairer to everyone.

Before the debate, I asked headteachers in Beverley and Holderness about the challenges they face. I will quote some of the problems that they highlighted. One said:

“We reduced staffing by reducing the number of cover supervisors and downsizing a number of teaching subject areas.”

Another said:

“Fewer sporting competitions—we can’t afford to pay for transport to away fixtures”—

imagine the cost of doing so in a sparsely populated rural area. Another said:

“Provision is stretched and children receive less intervention time”.

Another said:

“Resources are not being replaced or updated as we would like. The school guided reading scheme has been on the subject leaders’ development plan for the last 2 years and it is something that we cannot afford.”

That is the reality on the ground in schools in my constituency.

Those problems are not unique to the East Riding of Yorkshire—colleagues from up and down the country will testify to that, as is evidenced by the fact that there are so many of them here today. That is why the F40 group of local authorities, for which I serve as a vice-chairman, has come together to make the case for fairer funding. I pay tribute to the F40 campaign. It is led by Leicestershire Councillor Ivan Ould, who along with other F40 representatives has campaigned with great determination for almost 20 years. It is to the credit of the Government and Ministers that they are now listening to the campaign and are going to act.

I know colleagues will want me to say that we all owe a debt of gratitude to my hon. Friend the Member for Worcester (Mr Walker). He was a tireless champion of the issue in the previous Parliament, and I know he continues to be highly supportive in his new role as Parliamentary Private Secretary to the Secretary of State. It is a delight to see him here.

Progress is being made, in the form of the extra £390 million that was allocated as a down payment towards fairer funding in 2014, as well as through the Government’s manifesto commitment to make that extra resource part of the baseline funding settlement. The Minister said that there have been two parts to this: last year’s £390 million and this year’s; I know it is going to be every year from now on.

[Mr Gyimah]

It is in the baseline.

[Graham Stuart]

Listeners might have thought that it might not appear next year, and I would not want anyone to have that misapprehension.

[Andrew Bingham (High Peak) (Con)]

My hon. Friend is paying tribute to many people for their work on this issue, but no one has done more than he has, so I pay tribute to him, as I am sure they would. Derbyshire too is disadvantaged by the budget. He mentioned the £390 million and used the term “down payment”. It is pleasing that the money is now in the baseline, and that the budget is there, but it is still only a down payment on solving the problem, and not the solution. Does he agree?

[Mr Charles Walker (in the Chair)]

Order. Before Mr Stuart continues, I remind him that he has spoken for nearly 25 minutes. He has been very generous in taking interventions, but a huge number of colleagues wish to take part in the debate.

[Graham Stuart]

I am grateful to you for that timely reminder, Mr Walker, although I find that I am horribly few pages into my speech. I will have to truncate it.

The clock is ticking. We want to hear from the Minister about when we will have proposals for consultation. The gap between the highest and lowest-funded local authorities has grown steadily. Let us say that one local authority is on £6,000 per pupil and another is on around £4,000; if we give 2% to each, the cash gap will widen—that is obvious, really. That cannot be allowed to continue.

I am aware of how many other colleagues are ready to speak, but I will say just a little more. I have touched on how a fairer system would affect different areas. Barnsley would see the largest funding gain if the F40 proposal were introduced, and other deprived councils, including Leeds, Doncaster, Knowsley, Gateshead, Sheffield and Sunderland, would all make triple-figure gains per pupil under that proposal. A new formula would also restore fairness for the more rural counties of England, such as the East Riding, which failed to benefit from new Labour largesse.

A redistribution of resources is both right and fair. It should probably be phased in—I would say over three years—to mitigate the impact on those who will lose out. Russell Hobby, the general secretary of the National Association of Head Teachers, supports fairer funding. He is right when he says:

“There is no possible way to arrive at a fairer formula without taking money away from schools already facing cuts.”

He is running a members organisation, but has taken that on board. It is brave for a trade union leader with members in schools across the country to accept the logic and say, “Some schools will have to lose, but that has to happen for us to have fair funding.” If he and Brian Lightman at the Association of School and College Leaders are prepared to face their members, some of whom will lose out, and say that a different settlement is right, surely Ministers should grasp the nettle and make sure it happens. There is no way that we can defend a settlement under which there is a gap of more than £2,000 per pupil between the best-funded and least-funded 10 authorities.

I am delighted to see so many colleagues in the Chamber, and to see the Minister in his place. I know he has worked tirelessly on this issue in a difficult funding environment. We all look forward to hearing what he will do to bring about an end to this inequity, which has gone on too long.

[Several hon. Members rose—]

[Mr Charles Walker (in the Chair)]

Order. Before I call Mr Bradshaw, I should say that a huge number of colleagues want to speak. I do not intend to impose a time limit on Mr Bradshaw, but if he were to speak for 10 minutes, that would leave a little over five minutes for each colleague who follows.

13:58

[Mr Ben Bradshaw (Exeter) (Lab)]

I hope to take considerably less than 10 minutes, Mr Walker, although I may take one or two interventions.

We all agree that every child and family deserves the same chance in life when it comes to state-funded education; but at present, as the hon. Member for Beverley and Holderness (Graham Stuart) has so graphically shown, that is not the case. He chose to give figures rounded up or down to zero, but I will give the exact figures produced by the Association of School and College Leaders, which show that, on average, the 10 best-funded areas received grants of £6,297 per pupil this year, compared with an average of £4,208 per pupil in the 10 most poorly funded areas. That means that schools in the best-funded areas get 50% more per pupil than those in the worst-funded areas. As he said, for secondary schools of typical size, the gap amounts to nearly £2 million, the equivalent of 40 full-time teachers.

Devon schools are among the worst funded in the whole of England. We receive £23.4 million less than the national average, and our three and four-year-olds receive £3.7 million less. That means that each individual Devon schoolchild receives £270 less per head than the average for England, and three and four-year-olds receive £620 less per year than the average for England.

The situation in Exeter is even worse, because it is the only urban area of any significant size within the former Devon education authority area. Because of the extra cost of providing school transport or of maintaining small village schools in rural areas, my schools in Exeter are, in effect, hit by a double whammy: they are in one of the lowest-funded counties in England, and they lose out again because they have to cross-subsidise the cost of providing education in what is a largely rural county. Places such as Oxford, Norwich, Cambridge and Ipswich suffer similar double discrimination.

[Daniel Zeichner (Cambridge) (Lab)]

I thank my right hon. Friend for giving me a helpful cue. Does he agree that shire areas in the south-west and the east of England, such as mine, have long suffered from underfunding? That has seeped into the public consciousness, thanks to some powerful campaigns. In my county, the Cambridge News has run a fantastic campaign, and we are beginning to win the argument with the public.

[Mr Bradshaw]

I entirely agree, and I will come to some of the historical reasons for the underfunding in a minute, but first I want to mention one of my fantastic headteachers in Exeter, Moira Marder, who is the executive head of two of my high schools: St James school and Isca college. She has done comparisons of funding with two cohorts of very similar schools around England and found that St James and Isca are the worst funded of their cohorts in the whole of England. All Members’ local authorities will have suffered big cuts, but our local authority has suffered a 27% cut in funding—nearly 40% in real terms—and we still have to find £135 million over the next four years.

[John Redwood (Wokingham) (Con)]

An additional problem Wokingham has, as a very low-funded authority, is that a large number—about 13,000—of new homes are being built in very few years. We need to build extra schools and provide extra school places, and the sum is simply far too mean to allow for the extra costs of setting those up.

[Mr Bradshaw]

We face exactly the same challenge in Exeter, which is a growth area. We have huge additional housing developments everywhere, and I share the right hon. Gentleman’s concerns that the funding formula does not keep up with the growth in demand caused by those developments and growing populations.

I mentioned a moment ago the cost of school transport. I was staggered to discover that transport now takes up 50% of Devon’s total non-schools education budget—that is £20.9 million out of a budget of just over £40 million. Children in Exeter suffer a further injustice. Because none of our schools has a sixth form, all 16-to-19 education takes place at Exeter college. It is an excellent further education college, but as we all know, historically FE has been significantly worse funded per student than school sixth forms. That is now being addressed, but it still has not been addressed completely. FE has also suffered far bigger cuts in real-terms funding under the current Government than schools as a whole—indeed, we are told that further big cuts to FE are in the pipeline. I would argue that children in my constituency therefore suffer a triple disadvantage when it comes to education funding. They are in one of the worst-funded areas of the country—Devon; as urban dwellers, they subsidise the high cost of providing education in a rural county; and from 16 upwards, their only provision is FE, which itself is funded less than schools and faces huge cuts.

In spite of that situation, thanks to the hard work of teachers and students in my constituency, since I have been the MP we have seen a significant improvement in attainment across schools and at Exeter college—but that happened largely in the years of growing investment, when it was easier to deliver. In the past couple of years, there have been worrying signs in some of the schools that that improvement has stalled and might even be going into reverse. I have absolutely no doubt that part of the reason for that is that the headteachers, who are excellent, are struggling to keep the schools running in an effective way and provide the education and the service their students deserve because of the dire funding situation.

I know—my hon. Friend the Member for Cambridge (Daniel Zeichner) touched on this—that a significant reason for that underfunding is historical. I hope the Conservative Members present will hear me out on this. Allocations are based on historical funding levels. I used to cover the education authority in Devon when I was a local radio reporter, and I know that in the past allocations were based on historical funding levels, largely—as we can see from the number of Conservative Members here today—in Conservative shire authorities, which did not spend as much on education as Labour metropolitan authorities. I know that there are exceptions, as the hon. Member for Beverley and Holderness indicated, of Labour authorities that would benefit from a reallocation. That historical underspending is one of the main causes of the current injustice.

Given that the Government have moved almost entirely away from funding education through local authorities and that funding is now passported directly to schools, surely there is now no excuse for central Government to persist with this injustice. It is not fair to the children in the constituencies of all the Members of Parliament who are here today and the many who I know would have liked to be here but cannot. At the very least, what we need in the forthcoming comprehensive spending review is a clear commitment, as other Members have said, not only to an intention but to a timescale for delivery, so that we narrow the gap over a small number of years, so that the children of my constituents and of other Members’ constituents have exactly the same opportunities as those in the rest of England. We owe it to them and to future generations. That is a just system, and that is what we should push for.

14:06

[Neil Carmichael (Stroud) (Con)]

First, I pay tribute to my hon. Friend the Member for Beverley and Holderness (Graham Stuart) for securing the debate. As my predecessor as Chair of the Select Committee on Education, he is extremely familiar with the subject, which he demonstrated powerfully today. He made the point that there is a potential difference of £2,000 between the best and the worst-funded schools. That is obviously unacceptable, and he made the case clearly.

One thing we have to focus on is what education is for. Surely it is to give every child a fair chance, and we are not doing that, as we can see if we acknowledge reports such as the one by Sir Michael Wilshaw, to whom my hon. Friend referred, which spoke of a long tail of underachievement, because of course it described the situation in the very places where funding is not adequate. We have a mission to ensure that all children succeed, or are at least given a chance to succeed. We effectively kick ourselves in the teeth by not providing the right kind of resources where they are most needed. That point is made even more sharp when we note that the pupil premium still cannot allow a child to receive more than a child at a neighbouring school without the pupil premium. That is an indication of just how unfair the system is.

As Chair of the Education Committee, I have been at pains to emphasise the importance of fairer funding. When the Secretary of State for Education came to our Committee, we asked her what she was going to do, and she committed to write to us with a timetable. That timetable suggests we will be hearing in the new year a set of proposals to improve the situation. That is a really important commitment, because we need a fundamental system that works not only in the immediate future but for a long period. It will not do simply to rely on a little bit of extra money here and there. I note the Minister’s pledge to give a second tranche of £390 million, but that is just a band-aid solution; it is not a structural solution, and a structural solution is what we must have.

There are some issues we need to cover. One of them is multi-academy trusts. These are big and they stray into several areas—the biggest MAT actually has a school in every region of the country—and the real problem they face is the funding imbalance between the schools within them. If we are really interested in creating a new system of structures such as MATs, we have to deal with fairer funding, because we cannot have a MAT with one school funded at a low level and another funded at a much higher level. That is unacceptable for the model the Government appear to have. When the Government think about this reform, they must think of that.

My hon. Friend the Member for Cheltenham (Alex Chalk) referred to the need for planning in schools, which is absolutely right. Schools have to be able to plan on the basis of knowing what their budget is not only over a year, but over a long period. That is in the interests of good teaching, good learning and good chances for our children.

Another important idea is that of teachers going to other parts of the country, as the Secretary of State mentioned yesterday in a Policy Exchange lecture. If teachers are going to go from one place to another, there is an issue of funding. The process will be made much easier if the system of funding is fairer. It is a good idea, but in practice, it raises a few questions if fairer funding is not dealt with the way that we are all suggesting.

When the Select Committee receives the proposals from the Government, we will test them based on whether they are a big improvement, a sustainable improvement, a structural improvement, and, funnily enough, an improvement that respects the key policy drivers that the Government are pursuing, because these are two issues and if they are treated separately, they will remain separate and become significant problems themselves and between each other. We must have a funding system that paves the way for the kind of education system that we are all driving for. Those are the points I wanted to make to the Minister today.

14:11

[Ann Coffey (Stockport) (Lab)]

I will be brief. The guaranteed unit of funding for Stockport is £4,229 per pupil. It ranks 144th out of 151 authorities for funding; it is one of the worst-funded authorities in England. The national funding average is £4,718. If we got that national funding average, we would have £18 million more to spend on education in Stockport, which is a lot of teachers and additional help.

The base funding that the authority gives to each pupil is £2,795; it then allocates additional funding for deprivation, special needs, and children in care. Adswood primary school in my constituency, which is a good school, gets £4,889 per pupil. The school serves an area of very high deprivation. Children come into the education system with poor language development, challenging behaviour and poor social skills; in addition, the school has 145 special educational needs children. It is a school that is under pressure: it is cutting staffing, cutting supply cover, renegotiating service contracts and not doing any more outdoor learning, which is very important for children whose families cannot offer the kind of opportunities that children in more advantaged areas enjoy. There is clearly not enough funding.

In another part of my constituency, there is Tithe Barn primary school, which serves a more advantaged area. It receives £3,493 per pupil from the authority, because it does not get any deprivation money and has very few pupils with special educational needs. That is much less than the national average. To ensure that all children have the same opportunity in Stockport, there is a case for far higher funding for Adswood, but that can only be done by taking money away from Tithe Barn, which is unfair, because the children in Heaton Moor are entitled to a good education. Stockport is faced with the endless problem of robbing Peter to pay Paul, and then robbing Paul to pay Peter.

[Julian Knight (Solihull) (Con)]

I add my congratulations to the hon. Member for Beverley and Holderness (Graham Stuart) on securing the debate. I understand that in one respect the constituency of Stockport is probably very similar to Solihull, in that pupils come into our area from other areas that receive more money, and they are educated in our area but the money does not come with them. Does the hon. Lady want that situation to be addressed?

[Ann Coffey]

Whether funding should follow pupils or whether funding should be given directly to schools or allocated by the authority is another issue, and I will not go there, if the hon. Gentleman does not mind.

The only way forward that I can see for Stockport is a fairer funding formula that recognises the basic cost of educating a child before additional money is allocated for deprivation and other factors. Otherwise, we are going to be in a situation that is unfair in authorities such as Stockport. I think we are all agreed that every child is entitled to the best educational opportunity, every child is entitled to a basically good education, and some children are entitled to more help with getting that education than other children. However, every child should have that opportunity and unless the issue of fair funding is addressed, and addressed quickly, children in my constituency—children both from advantaged and disadvantaged areas—are going to be disadvantaged, and, quite frankly, that is not good enough.

14:15

[Nick Herbert (Arundel and South Downs) (Con)]

I congratulate my hon. Friend the Member for Beverley and Holderness (Graham Stuart) on securing the debate, along with the right hon. Member for Exeter (Mr Bradshaw), and for the way in which he has run this campaign and made his case.

This is a basic issue of fairness. I am sure that hon. Members will all be competing today to explain how poorly our schools are funded, but few will do better than me in that respect, because although West Sussex might be seen as a leafy and affluent county, it is not entirely so—there are significant pockets of deprivation, though less so in my constituency. West Sussex has a schools block unit of funding—so, per-pupil funding—of £4,198, which makes it the fourth worst-funded authority in England. Not only is that level of funding well below the England average of £4,612, but it puts us below our neighbours East Sussex, which has £4,442, and Surrey, which has £4,300, and of course well below the very well funded urban authorities, of which the City of London, with £8,587—double the funding of West Sussex—comes right at the top. If West Sussex were funded just at the average level for all county councils, our schools would receive an additional £15 million per annum. If we were funded at the level of our statistical neighbours—similar authorities—we would receive nearly £12 million per annum more. Our position is relatively very poor.

Some evidence of that can be seen in teacher-pupil ratios. Let us look at the United Learning academies and its urban schools. The Paddington academy has a pupil-teacher ratio of 1:8, whereas the Lambeth academy has a pupil-teacher of 1:12. At Midhurst Rother college, the first rural academy, serving my constituency in West Sussex, the pupil ratio is 1:17. Steyning grammar school, which is not, in fact a grammar school, serves my constituency and is in the state sector. It has a pupil-teacher ratio of just under 1:17.

The figures I have given include the pupil premium; nevertheless, the disparity is very substantial. In an environment of flat cash, despite the fact that spending in this area has been relatively protected by this Government—that was a manifesto commitment—compared with other budgets, such as the police budget, which are being very substantially cut as we all know, additional pressures are finding their way to schools for such things as national insurance and pension costs. It will be hard for schools to deal with flat cash if their funding is already on the floor. What heads and chairs of governors from schools in my constituency are saying to me is that they already face a difficult position because of the relatively poor funding.

We are grateful for the £390 million uplift that the Government have so far provided and to which the Minister rightly drew our attention. However, in West Sussex, that means that we received less than £1 million a year more, whereas the actual gap, if we were funded at the average level of county councils, is something like £15 million.

I do not believe that there is necessarily a link between public sector performance and resourcing. We cannot always say that improving public services means giving them more money, but I think that we are making it harder for schools when they are funded at the level that they are and when the unfairness is so manifest. This is not about politics—about proposing a political solution. It is about an objective level of unfairness. I therefore welcome both the Government’s manifesto commitment to deal with the problem, and the fact that the Minister has been so ready to listen to me and my colleagues in West Sussex about the unfairness. I urge the Minister to listen to what hon. Members are saying today: what we now need is a realisation of the manifesto commitment with an announcement in the spending review about redressing the unfairness in a timetabled way, so that we can prove that we do believe in fair funding for schools across the country.

14:20

[Richard Graham (Gloucester) (Con)]

It is a pleasure to serve under your chairmanship, Mr Walker, in a debate that is, at least on the Conservative side of the House, a complete sell-out. As has been noted, there have been several debates on this issue over the years. I have held one, but I do congratulate my hon. Friend the Member for Beverley and Holderness (Graham Stuart), not least because the timing of his debate today, in the run-up to the autumn statement, is particularly apposite. His hard work is much appreciated by us all.

It is also worth noting that there are no fewer than four Gloucestershire MPs here today. That shows both our keen interest in the issue and an interesting characteristic of the debate, which is the pride in being towards the bottom of the league table. That is the reverse of the normal situation when it comes to supporting a football or rugby club. Much has been said already, and I do not intend to try to compete with my right hon. Friend the Member for Arundel and South Downs (Nick Herbert) on being at the bottom of the league, but I do want to highlight the challenges that my hon. Friend the Minister faces and to ask him about particular areas where he might be able to help us today.

The situation in Gloucestershire is not unlike that in other places. The average spend per pupil, at £4,365, is considerably less than the national average, but it is worth pointing out that that gap has narrowed as a result of the changes made this year. They narrow the gap in terms of underfunding against the national average from 7.7% to 5.5%. More telling is the difference between one school in my constituency, the newly formed Gloucester academy, and a school in Tower Hamlets. Both those schools have very similar, mixed, multicultural pupils. In the case of Gloucester academy, they speak as many as 25 different languages, but the Gloucester academy pupil, on average, receives £5,443, whereas a pupil in the school in Tower Hamlets receives £8,256. The difference amounts to £2.1 million a year, and given that 80% of schools’ costs are in teaching, teachers and people, that puts significant pressure on the most important element of any school’s success—the teaching staff.

[Karen Lumley (Redditch) (Con)]

Does my hon. Friend agree that all children in this country, wherever they live, deserve the best education that we can give them? It is just not fair that children in Redditch, 5 miles away from Birmingham, receive £1,000 less each per year.

[Richard Graham]

My hon. Friend is absolutely right, but there is another aspect to this, which we must be aware of. I understand that the new Bishop of Gloucester, Bishop Rachel Treweek, the first female diocesan bishop in the land, will intervene in the House of Lords to help the F40 campaign, but she will be aware that fair funding for children across her diocese in the county of Gloucestershire will mean redistribution, which will probably arouse claims of unfairness in her previous patch in Tower Hamlets. This is a balancing act in terms of what is fair for all of us, and the Minister will have to juggle with that.

In the statement on 16 July, the Minister committed himself to making schools and early education fairer and said that he would put forward proposals in due course. I know that he will do so and that he will see the manifesto commitment simply to “make schools funding fairer” come true, but today I should like him to focus on the when, the what and the how. The when, in a sense, is the easiest bit, because the autumn statement is coming and we also have the commitment from my right hon. Friend the Secretary of State in her letter to the Chairman of the Education Committee, my constituency neighbour and hon. Friend the Member for Stroud (Neil Carmichael), which may inhibit a little what the Minister can say today.

The what will be all about the rebalancing—the winners and losers. As my hon. Friend the Member for Redditch (Karen Lumley) pointed out, one person’s fairness may be another person’s slight unfairness, but there is an absolute as well as a relative aim to go for. In addition to the what question, we have to look at the how, which is the process. It is easy for us to highlight the anomalies, but the Minister and his Department must find a solution, a process and a timeline.

The Library briefing paper contains a telling chart—exhibit A, which I am holding up, Mr Walker. In this flow diagram, there are simply too many elements. There is the guaranteed unit of funding, which was based on planned local authority spend some years ago, with three variables plus

“some subsequent additional funding for ministerial priorities.”

Then there is the dedicated schools grant, which was based on assessed levels of need plus locked-in historical decisions on spending, which I suggest led to the gap widening during the five years of the previous, coalition Government. Then there are four other grants, plus the local funding formula, in which there are 14 allowable factors, and local authorities can choose which values are actually used for each factor. That is too complicated, and I hope that the Minister today will confirm that whatever new process is introduced, it will be simpler, easier to understand and much fairer for everyone.

[Mr Gyimah]

My hon. Friend rightly touches on the point about the process. What I can say at the outset is that whatever the outcome of the spending review, there will be very careful consultation with everyone concerned, which means, I suspect, that this will not be our only debate here on fairer funding in terms of how we get to a resolution.

[Richard Graham]

I am grateful to the Minister for his clarification, which will help all hon. Members on both sides of the House. We all want to see simplicity in the process, a system that everyone can at least understand, funding that is fundamentally fairer and timing that will fulfil the manifesto commitment. The more light that the Minister can shed today, within the constraints of the upcoming autumn statement and the Secretary of State’s commitment to an early new year proposal, the more that will help us all to go back to our constituencies and our counties and say, “The Government are on the case. We hear what you are saying and we want to fix it as soon as possible.”

[Several hon. Members rose—]

[Mr Charles Walker (in the Chair)]

Order. I am going to call Daniel Kawczynski next and then Victoria Prentis, because she has to go and launch a fireworks display.

14:27

[Daniel Kawczynski (Shrewsbury and Atcham) (Con)]

Thank you, Mr Walker. May I say, for the benefit of those Conservative Members of Parliament who were not here in 2005 when I was first elected, just how difficult it was to take this issue to the then Labour Government? We had many meetings with the Labour Administration and I will never forget their intransigence on this issue. I am heartened to see the huge turnout of fellow Conservative MPs this afternoon and the passion with which many colleagues have spoken.

Thanks to your work, Mr Walker, and that of my hon. Friend for Beverley and Holderness (Graham Stuart), we saw changes in the last Parliament, from 2010 to 2015. As a result of the tremendous work that they and others did, we have received an extra £10 million per annum for Shropshire schools. I very much welcome the increases. However, the differences between our schools in Shropshire and the national average are still huge. It just goes to show what a terrible position we were in before the changes were made in 2010.

During the last general election, I made this the subject of my No. 1 pledge to my constituents, as I did in 2010. I believe in going to the electorate and putting in local manifestos what we will do over the next five years if we are elected to office: I am looking at my hon. Friend the Minister. On my election pledges, which all the people of Shrewsbury received, the No. 1 pledge this time around, as last time, was to use our Conservative majority—if we had one, and we do—to settle the issue once and for all and ensure that Shropshire children are no longer discriminated against as they have been in the past. I emphasise that we receive £4,112 per annum for our Salopian children, which contrasts with the average for the best-funded schools of £6,297. As we all know, some schools get £7,000 or £8,000 for each child per annum, which is more than double what Shropshire children get.

I alluded to my next point in my intervention on my hon. Friend the Member for Beverley and Holderness. If he could come round to see some of my schools in Shropshire—I would welcome his coming to visit—he would see the leaking roofs, the poor insulation, the lack of equipment, the old books and the restrictions on certain extracurricular activities. The fact that some of the parents in my constituency have to raise money through fundraising activities, such as barbecues and all sorts of other things, to buy basic equipment that is automatically provided in other parts of the country is simply unacceptable.

Buildwas primary school is right on the border between my constituency and that of my hon. Friend the Member for Telford (Lucy Allan). We are both fighting for Buildwas school, which is in a very remote rural village, to continue operating, and we hope that it will be saved through an academy programme. Some of the problems that the school has experienced inevitably boil down to a lack of funding from previous Governments. I invite the Minister to come to Shropshire at his earliest convenience, because I want him to see the leaking roofs and the dilapidated state of some of my schools. When I go to Birmingham, as I do sometimes for various duties, I see the sort of equivalents it has. It is another world, and that is completely and wholly unacceptable.

[Mr Gyimah]

I would be delighted to visit my hon. Friend’s constituency at my earliest convenience, as he requested. It is worth making the distinction between the capital needs of a school and its revenue funding needs. If there are schools in his constituency that are in need of capital, he should definitely let the Department know. There was a capital round during the last Parliament, and I envisage that there will be another one during this Parliament, to help to repair the leaking roofs of schools such as those in his constituency.

[Daniel Kawczynski]

I am grateful to the Minister, and I will make sure that all five Salopian MPs meet him to arrange things directly. I will end with an important point that has not yet been made. Although we are one of the worst funded areas in the country, Salopian schools get some of the best results in the country. That is a fascinating fact, which I do not think that many people have talked about, and I urge the Minister to think about it. How does Shropshire, despite the fact that it receives less than half what other schools get, manage to achieve such extraordinarily high levels of success? Obviously, we have some of the best teachers in the country, and I pay tribute to their dedication and hard work. However, I would like the Minister to examine the massive differences in attainment between different areas and to look specifically at those, such as Shropshire, which have been underfunded but which achieve tremendous results. We have something to learn from that for the benefit of future generations.

[Several hon. Members rose—]

[Mr Charles Walker (in the Chair)]

Order. We are in danger of getting everyone in if hon. Members stick to five minutes and other colleagues resist the temptation to intervene. We might have to drop to four minutes for the last few contributions, but things are looking good.

14:33

[Victoria Prentis (Banbury) (Con)]

Thank you, Mr Walker, for reminding us that school firework displays can be such a good way of raising money. I am grateful to my hon. Friend the Member for Beverley and Holderness (Graham Stuart) and the right hon. Member for Exeter (Mr Bradshaw) for elegantly making a point that we often hear from our children. After all, children have an even more highly developed sense of fairness than do the rest of us. My three-year-old niece frequently says, “It’s not fair!” My hon. Friend and the right hon. Gentleman have made their point much better than she could.

I am grateful to you, Mr Walker, for calling me first among new colleagues. We are somewhat jumping on the bandwagon of the huge amount of work that has been done by so many in this room, and we are grateful to them. We are also grateful for the wonderful F40 campaign, which has proposed an approach to schools funding that is, to my mind at least, very sensible. I know that progress has been made, and we in Oxfordshire welcomed the extra money that we received this year. I am grateful to the Minister for his support, not least for the visit that he made earlier this summer to Heyford Park free school. He came to see at first hand how Oxfordshire schools are doing what they can with the resources that are available to them.

Oxford may be a byword for excellence in education—although not necessarily to those of us who went somewhere else. However, such excellence is not, sadly, found in all educational establishments across the county. In Banbury, we still have areas of real deprivation. Worryingly, in an area of almost full employment, many of our children and their parents lack the aspiration to push themselves to the limits of their educational attainment. Our headteachers have many concerns. We have a very public problem with child sexual exploitation, which we are working hard to address. Staff and volunteer governors, and indeed our children, are all working hard but the results are not as good as they could be. I do not want to trade figures with my hon. Friend the Member for Gloucester (Richard Graham), who mentioned Tower Hamlets, but we in Oxfordshire receive £2,663.64 less per pupil than do those in Tower Hamlets. That is even worse than his figure.

Yesterday I met two headteachers, one from Bicester and one from Banbury. They gave me some practical examples of the problems caused by lack of funding. One told me that she had been unable to recruit a head of maths because she could not offer a suitable salary to attract good candidates to the role. I should add that house prices in our area are significantly above the national average. The maths department suffered without strong leadership, and the students’ results were quickly affected. A new head of maths has been recruited but has not yet arrived from Jamaica.

The other headteacher told me that after his school gained its best exam results on record, he had had to make staff redundant. He remains six teachers down. Both schools have large key stage 3 classes because there are simply not enough teachers to teach them. That is a particular concern for those in the lower sets in maths and English, who would most benefit from smaller classes at that important stage of their development. F40 has helpfully calculated that were its formula to be introduced, each school in my constituency would receive £125.50 more per pupil. When I mentioned that figure to the headteachers, they said that it would make a real and significant difference. It would amount to three or four extra teachers in my secondary schools.

This morning, I spoke to the reception teacher at one of our strongest primaries, and I asked her how she would spend the extra money. Without hesitating for a moment, she suggested two areas. At the reception stage, she would like a teaching assistant to do targeted work on communication and language skills with small groups of children. She would spend the rest of the money on one-to-one interventions on English and maths in year 5, which would make an immediate difference to results and, much more importantly, would make a difference to the life choices of children who have been helped in such a way.

So much work has been done by the people in this room to find a solution to the funding formula. I hope that this is the moment to make progress.

14:38

[James Cartlidge (South Suffolk) (Con)]

I congratulate my hon. Friend the Member for Beverley and Holderness (Graham Stuart) on securing this debate on an incredibly important subject. I want to start by making two broad points. The first concerns welfare reform, about which there has been some controversy of late. I must admit that I have spoken in favour of tax credit changes on several occasions, and each time I made the point that I felt that the benefit trap prevented people from making the most of their potential. The key thing is that if we are going to reform welfare and take those sorts of tough decisions, we must balance them out by supporting our schools, which enable people to make the most of their potential. I think that that is incredibly important.

The other general point is that Conservative Members have not marched in today calling for more borrowing, a bigger deficit and even more spending. We all support overall Government policy. We simply want a fairer share of the existing spending within the existing prudential spending levels that the Chancellor has set out.

Schools in Suffolk receive block funding per pupil of £4,119 compared with the national average of £4,447. I will resist the urge to get into a debate about who is in the worst position, but Suffolk is certainly in the bottom quartile. In my view, there is a link to standards. There has been a slight improvement recently. For the first time in some years, Suffolk is now slightly ahead of the national average for GCSEs with 53.4% of our pupils gaining five GCSEs at grades A to C, including English and maths.

When I spoke to the county council about the issue, it outlined some of the benefits if we were to achieve higher spending. There is no point simply asking for it: we have to decide what we would do with it. Two things are most important. First, we have some tiny schools in my constituency which have a question mark over their sustainability. With higher spending, we could make small schools more sustainable and therefore preserve a key part of a rural constituency. The other point the council made is that we could meet the increased demands for support for learners with special educational needs and high needs.

I feel very passionately about this subject. I mentioned welfare earlier, and I think that education spending is the prime public good in public spending. It is the way that people from every background can be given a chance by the taxpayer to get on in life. If we are going to spend more on anybody, it must be on those with the greatest needs. In other words, when we ask for higher spending, it is for some of the most vulnerable people in our constituencies. This is not about more money for the middle classes, which is another important point to stress to the Minister.

My final point—something that I have not had a chance to talk about since getting elected but certainly talked a lot about in the build-up to the election in my constituency—is that Suffolk is part of the eastern region. We recently had a referendum about the future of the United Kingdom in which the Prime Minister made a vow. Now, I made a vow to my constituents to represent them and their best interests. The eastern region receives, in total Government spending, an average of £7,950 per head, compared with £9,866 in London and £10,275 in Scotland. Scotland receives 23% per head more than my county while paying identical rates of taxation. I regard that, prima facie, as totally unfair and unacceptable. It would be all right if our trains were of the highest quality.

[Carol Monaghan (Glasgow North West) (SNP)]

It is interesting that the hon. Gentleman mentions funding. Yesterday in Scotland questions, there was an allegation of Scotland being subsidised, but the fact is that Scottish people are paying more in taxes than they receive back in block grants. His own Government have identified that.

[David Mowat]

rose—

[James Cartlidge]

I will just make one point so that my hon. Friend the Member for Warrington South (David Mowat) is not intervening on an intervention, which is that I call on him to support me on that point.

[David Mowat]

On the Barnett formula, it is true that, historically, Scotland has not been subsidised, principally because the Barnett formula extra—over and above need—has been made up for by Scottish oil. Therefore, the taxation situation is as the hon. Member for Glasgow North West (Carol Monaghan) said. That is not the case this year, nor will it be the case in the future.

[Mr Charles Walker (in the Chair)]

James Cartlidge— back to education.

[James Cartlidge]

It is about education because this is about spending. The point I am making is that if Suffolk had superb trains that were well funded, instead of sending the premium on our railway revenues to other parts of the country, we might feel better about the poor educational funding. If the eastern region received more in terms of the overall Barnett formula, we might feel better. The population of Suffolk is the second-oldest of any county in the country after Norfolk, but our spending formula for health does not reflect that. If all of those were better, we might feel happier. Therefore, we want better spending on schools because our taxpayers are losing out overall. My constituents work hard and pay their taxes. They simply want a fair deal for them and their children.

14:44

[Julian Sturdy (York Outer) (Con)]

It is a pleasure to serve under your chairmanship, Mr Walker.

I pay tribute to my hon. Friend the Member for Beverley and Holderness (Graham Stuart) and to you, Mr Walker, for all the hard work on this issue. I think it was some eight years ago that my hon. Friend the Member for Beverley and Holderness first had a debate on fairer funding for schools. They say that some things in Parliament take time to mature. I know my hon. Friend is maturing with distinction, but let us hope that his eight-year campaign is drawing to a close. Since he first raised the issue eight years ago, sadly, an entire generation of schoolchildren in York have been short-changed on the education funding they deserve.

Although I initially welcomed the Government’s additional £390 million of funding in June 2014, the announcement was fatally undermined by its frankly woeful and simplistic implementation. Restricting the additional funding solely to the schools block element failed to recognise the position of many poorly funded local authorities, such as mine in York, which have historically been greater users of special educational needs resources. The result of this implementation is that some schools that already receive generous per-pupil funding have received yet more. I know that the Minister is well aware of that, and I really do have confidence that, over the coming weeks, he and the Department for Education will deliver the much-needed new funding formula, which we have to deliver.

I want to illustrate what this means for schools across my constituency. How is it fair that schools in the City of London receive block funding of well over £8,000 per pupil, whereas schools in York receive barely over £4,000 per pupil? Schools in York receive less than half of the amount received by those London schools. York has dropped from being the 23rd worst-funded local authority in the country to the 7th—a situation that is simply manifestly unfair.

I wanted to focus on the situation faced by two schools in my constituency, Fulford school and Manor Church of England academy, but in the interests of time I will focus on Fulford school. Fulford is a co-educational comprehensive school, taking pupils from across the south of York. Despite having excellent GCSE and A-level results, Fulford is one of the worst-funded schools in the local authority. The school also receives a very low level of pupil premium funding, which, as hon. Members will know, is calculated on the basis of deprivation and low achievement. The same factors are taken into account in the local authority’s funding formula, as dictated by national guidelines. That further compounds the problem, as some schools receive double funding for such criteria while others receive less. This also serves to reduce the resources available to schools such as Fulford, and has an impact on the materials that can be provided to pupils, as well as limiting the courses available to them. Teacher contact time and staffing ratios have also been affected, placing greater pressure on teachers’ workloads, particularly in high-achieving schools such as Fulford.

The school’s headteacher, Ms Savage, has concerns that this will impact on the retention of her best teachers, who have worked so hard to help my constituents’ children achieve exceptional results. Fulford has been able to avoid redundancies and more serious cuts through additional funding allocated for rising pupil numbers. However, that is simply unsustainable in the long term. As a result, Fulford is heading towards a budget deficit, despite being recognised by The Sunday Times as one of the best financially managed schools in the country. This story is not unusual. The headteachers I have had the pleasure of meeting across my constituency are struggling with the unfairness of the funding formula. This cannot continue.

Children come from all walks of life, but the one thing they have in common is the right to a good education. The only fair way to achieve that is through a national funding formula. I hope that the Government will deliver on their manifesto pledge.

14:49

[Victoria Atkins (Louth and Horncastle) (Con)]

It is a pleasure to serve under your chairmanship, Mr Walker. I thank my hon. Friend the Member for Beverley and Holderness (Graham Stuart) and the right hon. Member for Exeter (Mr Bradshaw) for securing this important debate.

I am privileged to represent one of the most rural and beautiful constituencies in the country, running from the Lincolnshire wolds across to the sweeping coastline of the North sea. I have had the pleasure of visiting many local schools—too many to list in the short time available—and on each visit the pupils have been engaged, dedicated and unfailingly polite yet, in money terms, they receive far less than their peers in cities. For example, they each receive £2,513 less than a pupil in Tower Hamlets. That funding gap is not just an abstract figure; it translates directly into class sizes, facilities and the range of subjects on offer, even more so when the vast distances of the country’s second-largest county are taken into account. Simply transporting children to and from school costs Lincolnshire County Council £27 million a year.

Ahead of today’s debate, I emailed all the schools in my constituency to ask school leaders for their views, and they have raised issues on both a strategic and a day-to-day level. The impact at strategic level includes the ability to attract staff to work in remote areas, particularly in the all-important leadership roles. That is made all the more difficult if rural schools do not have the budget to pay leaders as well as schools in more urban areas. One school leader emailed me to say:

“We are so restricted in our budgets that our school’s performance is now being stinted by these restrictions.”

Another wrote saying that

“every year that passes we and other schools in our setting are disadvantaged.”

Yet another wrote of the reality of rural schools in Lincolnshire: 100 schools in the county have fewer than 100 pupils because the rural sparsity of the county means that villages have very few pupils. If a village school closes, it has an enormous impact not just on pupils, parents and staff but on the villages concerned.

Teachers have also written to me about the day-to-day impact. One teacher gave the example that the cost of a swimming lesson is much higher in Lincolnshire because of the transport costs and, I suspect, because there are fewer swimming pools per hectare than in a city centre. It simply cannot be right that pupils in Lincolnshire should have to face disadvantages in everything from the leadership of their school to learning to swim because they receive less money from central Government grants than their peers in city centres.

I am conscious of the time, so I finish by paying tribute to the schools, governors and teachers in my constituency and further afield who provide, on the whole, a very good education in the circumstances, and I hope the Government repay their efforts with a fairer funding formula. I know the Minister is listening.

14:53

[James Heappey (Wells) (Con)]

It is a pleasure to serve under your chairmanship, Mr Walker. I congratulate my hon. Friend the Member for Beverley and Holderness (Graham Stuart) on securing this debate, and on all his work, not only to secure fairer funding for education in rural areas, but on broadband, public services and health—the full works. His work is much appreciated.

I also pay tribute to Somerset County Council, which vigorously campaigns on the unfairness of the funding that our county receives, and to the many schools that have contacted me and supported the F40 petition. It is no wonder that the schools do so, because we feel this unfairness acutely in Somerset—the county is 135th out of 150 funding authorities. We are £160 per pupil above the lowest-ranked funding authority, but we are fully £3,327 behind the very highest. We are in the bottom fifth across all three dedicated schools grant funding blocks. If Somerset were to receive just the average, it would receive nearly £40 million extra a year.

Earlier, my hon. Friend the Member for Gloucester (Richard Graham) said that we are all used to being at the bottom of the table. I grew up supporting Aston Villa and Bristol rugby club, so I am familiar with that territory. I dream that those clubs might one day reach mid-table mediocrity, which, for now, is exactly what I aspire to when it comes to school funding in Somerset.

[Matt Warman (Boston and Skegness) (Con)]

I am sure that is the minimum to which my hon. Friend aspires, rather than the maximum. I, too, would like Lincolnshire to reach that point—and then move further upwards.

[James Heappey]

Indeed. I have long since given up on seeing Villa in the Champions League and, for now, just those dizzy heights of mid-table would be perfectly good because it would solve the unfairness and deliver an extra £40 million for our county.

When we make that case, the problem is that people say, “But surely you are robbing Peter to pay Paul.” I will therefore make a brief comparison between Somerset and Southwark. I have no axe to grind against the good folk of Southwark, but I would like to indulge my penchant for alliteration, and Somerset and Southwark work well. I suspect, however, that the comparison is not atypical.

Ten years ago, the funding for primary schools in Somerset was £3,570 per pupil per annum, and for secondary schools it was £4,520; in Southwark, at the same time, it was £5,480 for primary schools and £7,210 for secondary schools. In other words, Southwark received about 55% more funding than Somerset. Over the 10 years since, the gap has narrowed very slightly; there is now some 50% more funding over the river than at the other end of the M4. Over those 10 years, however, the attainment gap has not only closed but reversed. Ten years ago, 47.3% of pupils in Southwark achieved five or more A* to C grades at GCSE, compared with 56.6% of pupils in Somerset. There was clearly a need for intervention, and well done to the Government of the day for intervening, but the problem is that now Southwark soars on 62.9%, while Somerset has stood still on 57.7%.

Of course, I applaud the Government for increasing funding to improve standards in inner-city schools, but the gap has reversed and will widen if we do not address it now. I know the Minister will agree with that in principle, but he must tell us today when we will see a decisive move to close that attainment gap between urban and rural areas before it widens further. Now is the time to put it right so that all children are funded equally and so that we can ensure equality of opportunity for all our kids, regardless of where they live.

[Mr Charles Walker (in the Chair)]

Colleagues are being so well behaved that they may now intervene—not too often, but occasionally. Don’t hold back.

14:58

[David Mowat (Warrington South) (Con)]

I, too, congratulate the right hon. Member for Exeter (Mr Bradshaw) and my hon. Friend the Member for Beverley and Holderness (Graham Stuart) on securing this debate. Like others, I am a veteran of these debates—we had one in April 2012 and another in April 2014—and they can be surreal, because we all agree that something must be done. The Opposition did not particularly agree in the 2012 debate but, to be fair, by 2014 they did. The Ministers who responded to those debates also agreed that something had to be done, that we could not go on like this and that there had to be a national formula, yet the months go by.

Just to validate myself, Warrington is 144th in the league table, having declined further once the £390 million was given out under another opaque mechanism towards the end of the last Parliament. I want to say something a little different from other Members. Let me be clear: yes, we have £2,000 less per pupil than other areas, but I would not mind that if I could point my schools in Warrington to an audit trail explaining why it was necessary. Perhaps there is less deprivation. Perhaps sparsity or the age profiles are different. Perhaps there are various criteria. However, that is not the case. The only reason I can give is, “It’s always been like that, and we haven’t got round to fixing it.”

[Sir David Amess in the Chair]

I said in the April 2012 debate, and I think perhaps the April 2014 debate as well, that a new Government came in bristling with talent and reforming zeal, agreeing that the situation was wrong, yet the problem was somehow too difficult, because there had to be losers. That is the crux of it: the Government were concerned that the losers would shout more than the winners. Morally, that is not a good position. We are talking about the life chances of children in our constituencies.

[Michael Tomlinson (Mid Dorset and North Poole) (Con)]

Speaking of life chances of children, my hon. Friend has the pleasure of being the Member of Parliament representing my nephew and niece. I encourage him to fight vigorously not only for them—his constituents—but for the rest of us who suffer without a fairer funding formula.

[David Mowat]

We are doing our best for my hon. Friend’s nephew and niece.

[Kevin Foster]

Will my hon. Friend give way?

[David Mowat]

Let me just answer the question. Actually, I want to make one further point to the Minister. I support free schools, and I support a number of our initiatives, including academy consolidation, studio schools, university technical colleges, free school dinners and the pupil premium. They are all good things, yet for my community in Warrington, they are all second-tier issues compared with funding. The situation is not acceptable. Some of these things are almost like a displacement activity for Ministers. What matters to my community is that the Government put a fair funding formula in place, rather than just acknowledging the problem again or saying, “We know it’s wrong, but it’s too hard to fix.” We need to get on with it.

What the Government do is produce league tables. There is a sort of covenant: the Government fund, the schools have to educate, and league tables exist to compare how they are getting on. At some point, unless funding is done fairly, league tables will break down. Maybe there should be funding-adjusted league tables. My hon. Friend the Member for Wells (James Heappey) talked about the two S’s, Southwark and Somerset. My two are Westminster and Warrington, where the same issue exists—a £2,000 discrepancy. In the correction that took place with the £390 million, oddly, Westminster got more than Warrington, for reasons that were opaque and hard to explain.

Yet there is a way forward. The F40 has set out the criteria for a new formula in a very good paper: age weighting, deprivation, special educational needs, proportion of children whose first language is not English and sparsity. As I said, if as the result of all that Warrington ended up getting £2,000 less than Tower Hamlets, I would be content, because I could explain to my headteachers the reasons why they are having to cut back and make teaching assistants and teachers redundant. At the moment, I cannot do that, and it really is not good enough.

Here is where I give the Minister some encouragement. I do not expect everything to be fixed immediately once a formula is introduced, but the direction of travel must be set. F40 suggested that it should happen over three years, although it could be longer. The direction of travel could take three, five or even 10 years to unwind. We have been talking about it for an awfully long time; it has been an issue for 20 years. However, it is not acceptable for us not even to take the first step of setting up an audit trail so that we can explain to our headteachers why schools in my constituency, such as Bridgewater and St Monica’s, are under huge pressure, partly due to centrally organised salary adjustments.

If, after the consultation—which will apparently be next year, so we will be a year into this Parliament before it ends—the Minister comes back with an approach that means it takes longer than three years to fix the problem, I will not necessarily be upset, but I want the first step to be taken, so that we do not continue to acknowledge the problem while doing nothing. We are talking about the life chances of many children.

15:05

[Michelle Donelan (Chippenham) (Con)]

I commend my hon. Friend the Member for Beverley and Holderness (Graham Stuart) and the right hon. Member for Exeter (Mr Bradshaw) for securing this important debate. I certainly need not express how important the topic is. It is important because it is about ensuring that children have the best shot at life and the opportunities that they deserve.

Like my colleagues, I understand how difficult it is to rectify the hugely complicated school funding formula, but it is imperative that we make the changes. No wonder it is a key local issue in Wiltshire, as well as everywhere else, it appears. The country’s average received grant this year was £6,500 per pupil, whereas in Wiltshire it was £4,300 per pupil. Just think how much that £2,000 per pupil could do and the benefits that it would bring to their education. Every secondary school in my constituency would receive between £2 million and £3.7 million each school year. In total, Wiltshire schools lose out by more than £35 million compared with the best funded schools in the UK. That is a colossal amount, and it is a colossal injustice to hard-working children.

We cannot sit back and let it continue. We need a new national per-pupil funding formula, rather than the arbitrary and complicated system that we currently have. Yesterday, as my hon. Friend the Member for Stroud (Neil Carmichael) mentioned, the Select Committee on Education, of which I am a member, published a letter from the Secretary of State expressing her strong commitment to fairer funding and saying that she wanted to push it within the spending review. Along with many of my colleagues, I have repeatedly urged the Chancellor and Prime Minister to make education funding an issue for the spending review and a priority.

I will not beat about the bush: I think that the current spending formula is utterly ludicrous and absolutely unfair. Why should children born in my constituency have less money spent on their education than those living down the road in Bristol, for instance? They are all funded by the taxpayer, but it is a postcode lottery that takes no account of children’s needs or their numbers. The quest for fairer funding in our education system is backed by parents and teachers up and down the country, especially in Wiltshire, where more than 8,000 people signed my petition, showing how important it is as a local issue.

Of course, money is not everything in education. My sister is in the profession, and I know full well how important teachers are. An inspirational teacher can transform somebody’s life. However, money aids the recruitment and retention of teachers, as well as funding the resources that they can use to support teaching, giving children the start that they deserve. I ask the Minister: do not all children deserve a great and equal start, regardless of where they live?

The Prime Minister spoke time and again about equality at the Conservative party conference this year. I hope that that equality will be extended to the most important area of all—education, the building block of the opportunities and the aspiration nation that we all want to achieve. We need action as soon as possible. Every year that we wait, a child in Wiltshire receives less funding and is disadvantaged by the state education system. We must right that wrong as soon as possible to ensure that all children in Wiltshire and in the country as a whole can enjoy equal opportunities from the off. The Government must honour their commitment to equality and stop penalising children for being born in areas such as Wiltshire.

15:08

[Michael Tomlinson (Mid Dorset and North Poole) (Con)]

It is a pleasure to serve under your chairmanship, Sir David. I echo other hon. Members in paying tribute to my hon. Friend the Member for Beverley and Holderness (Graham Stuart) and the right hon. Member for Exeter (Mr Bradshaw) for securing this debate. It is a pleasure to follow so many colleagues and other hon. Members making the case so clearly for a fairer funding formula.

I come from a family of teachers, I married into a family of teachers and some have said that I ran away from teaching as a profession. I am a governor at my local school, and I pay tribute to all the hard work our teachers in Dorset and Poole put in day in, day out. However, our schools are being let down by the current funding formula. My constituency can compete with those of other hon. Members, because Dorset is in the lowest 11 authorities for funding per pupil, securing just £4,239. Poole fares even worse, as the second worst funded—not a statistic I am proud of—receiving only £4,167. It is those statistics and facts that bring me here to argue on behalf of schools in my constituency.

As others have said, such statistics suggest that the current funding formula is beyond its sell-by date. More than that, it appears to have no rationale. My hon. Friend the Member for Gloucester (Richard Graham) mentioned his exhibit A, and it shows that there is no historic rhyme or reason to the fact that some schools in Poole get the second-lowest funding, while other schools across the country get much more. Over the years, that has created an unfair situation, which does not serve our schools or our children in Poole and Dorset. There is not the level playing field there should be.

Other hon. Members have mentioned that the funding formula means there is a large disparity between schools across the country with similar characteristics, which are receiving very different amounts.

[Mr Gyimah]

indicated assent.

[Michael Tomlinson]

I am pleased to see the Minister nodding in agreement.

The F40 campaign group, of which I am a member, has set out an alternative formula, which I welcome. The formula would help my constituency by reducing the funding gap from £4,000 to just over £3,000. I could quote more facts and figures, as other hon. Members have done. Behind the numbers, however, are real individuals—real families, children and teachers—and those figures will make a difference in their lives and in their schools. In my constituency, the F40 proposals would see schools get an extra £240 per pupil—an increase of just under 5%, which is welcome. Schools in Poole would receive an extra £116—an increase of just under 3%, which is also welcome. However, I sound a note of caution: under the formula, schools in Poole would still be among the worst funded, although the changes would help to start narrowing the gap.

[Victoria Atkins]

Does my hon. Friend agree that the campaign is asking not for more money from the Treasury, but simply for a reallocation, so that the money that is already being spent is spent more fairly?

[Michael Tomlinson]

I am grateful to my hon. Friend for making that point. It is right that the formula is about beginning to close the gap. That is all I am fighting for today.

I am pleased that the Government have recognised the issue’s importance. I am also pleased to have fought the election on a manifesto that set out so clearly the need for a fairer funding formula. Similarly, I was pleased by the responses of the Secretary of State and the Prime Minister to my questions in the House. I was pleased not just because they were in answer to my questions, but because they were encouraging.

Other hon. Members have mentioned the £390 million that was granted in 2014-15 and that is now embedded in future years. I welcome that, but I see it as a down payment—a first step—rather than the finished article.

Let me turn for a moment to wider funding issues, because the motion is that

“this House has considered funding for schools”

generally. Montacute school in my constituency is, as the Minister may know, a special academy for children with severe and multiple learning difficulties and special needs. Recently, it received a very welcome £5 million to completely restructure what was a rather dilapidated building that was falling down, and I was delighted to be present at the opening of the new building. However, the funding included no additional money for the inside—the fixtures and fittings, which are the very things that are required to make a school really a school.

Local families have clubbed together as part of Monty’s fund, and they have raised £500,000 to date. However, more is required, and I urge the Minister to consider that as a particular request. I will be making a small difference by dressing up as Father Christmas and entering the great Santa fun run with members of Wimborne rotary club. I invite the Minister to join me. Where better to run and raise money for a good cause than round Badbury Rings?

[Kevin Foster]

Does my hon. Friend agree that although it is great to see such charitable work, people would be more encouraged to take part if they saw a fair funding formula in place?

[Michael Tomlinson]

My hon. Friend is right that it is all well and good raising money in small ways like this, but we are actually arguing for a fairer funding formula, so let me return to that.

Few people in the Chamber, and few outside it, have questioned the logic of, or the need for, a fairer funding formula. The inequality is clear to see, and I urge the Minister, as other Members have done, to set out a timetable. We need substantive change, and we need it to put the needs of our children first and foremost.

15:16

[Neil Parish (Tiverton and Honiton) (Con)]

It is a great pleasure to serve under your chairmanship, Sir David. I thank my hon. Friend the Member for Beverley and Holderness (Graham Stuart) for his persistence. I also thank the right hon. Member for Exeter (Mr Bradshaw). Similarly, I thank my hon. Friend the Member for Worcester (Mr Walker), who fought hard in the last Parliament for fairer education funding, and who continues to do so in this one.

All of us seem to have been fighting for a change for years. I have huge faith in the Minister—I really have. In “Yes Minister”, one of the characters says, “That will be a very brave decision, Minister,” and we want this Minister to make a very brave decision. The £390 million in funding that was introduced in the last Parliament, and which is going into the base budget, is very welcome. In the end, however, it will not cure the underlying problem. If we just put a bit of money in each time, we will not alter the league table at all. Devon went from fifth from the bottom to sixth from the bottom. While that is welcome, we want a huge amount more to be done.

My constituency, which is by far the most beautiful in the country—not that I am biased—contains a huge number of small schools, which have federated. The headteachers share many schools. There are great teachers and great classroom assistants. People are working really hard, and they deliver a very good education. However, if they can deliver a good education, why are some other areas getting so much more money? Why is it fair for things to be like that? Why can some of that money not be shared with other areas?

Local government funding seems to be one of those issues, like education, that is so complex that Governments over the years have decided—almost with fear and trepidation—not to alter it, because that would cause so many problems. However, we have to alter it; otherwise, we will not deliver on what we have promised.

[Graham Stuart]

I would like my hon. Friend to know that, when I started campaigning for fairer funding in local government and education, I had blond hair. I have been doing this not just for eight years—I first raised the F40 in 2005. Does my hon. Friend agree that the Government need to be courageous when they come forward with proposals? They need to be ambitious and really lift authorities that have been disadvantaged for too long. At the end of this, we have to have the courage to do something significant and level the playing field, albeit that it will take time to bring these things in.

[Neil Parish]

I am glad to see that my hon. Friend still actually has his hair, albeit that it is white. Seriously, though, all of us here—there are 30 Members here, and there were more when we started the debate, on a one-line Whip on a Thursday—have been fighting hard on this issue. What I want to tell the Minister is that we need to be brave enough about funding. We need some sort of siphon to take money from the top and spread it gradually to the bottom, or the anomaly will never be put right. The current situation is wrong for those of us whose constituents have high aspirations but who need more funding to raise them even higher. We need that to be dealt with. All our constituents pay the same taxes, so why should their children not benefit? Other hon. Members have mentioned how schools have great parents, who raise money to help; and that is all very good, but, as I have said, it will not deal with the funding problem.

My constituency has further education colleges in Axminster and Honiton, and Petroc college in Tiverton, and all receive reduced funding. If we have aspirations for young people going from primary through secondary and on to FE or university, the education must be provided. What the Government are doing about apprenticeships is great, but good colleges are necessary if the apprenticeships are to be of real value. All those things fit together.

Tiverton high school is on a flood plain, and in 2012 it was nearly flooded. We need to find funding so that it can be rebuilt on higher land—land is available. All that takes time, I know, but we must ensure that we are treated equally. Our fear is that we are not being treated equally. Since the general election the west country is virtually all Conservative—apart from the little patch of red that is the constituency of the right hon. Member for Exeter, which we understand. My point is that the Government have a lot of responsibility. My hon. Friend the Member for Chippenham (Michelle Donelan) mentioned, as other Members have, the Government’s commitment to put the situation right. I reiterate my huge confidence in the Minister and I will invite him to Devon to see what a great job our schools are doing, and what refurbishment and extra funding they need. The Government will settle the matter, and put it right. Again I ask the Minister: please, be brave.

15:22

[Edward Argar (Charnwood) (Con)]

It is, as always, a pleasure to serve under your chairmanship, Sir David.

I congratulate my hon. Friend the Member for Beverley and Holderness (Graham Stuart) and the right hon. Member for Exeter (Mr Bradshaw) on securing the debate. I congratulate my hon. Friend also on his leadership of the campaign, and on what it has achieved thus far. The receptiveness of the Secretary of State for Education to the case that he puts is due not only to her well known fairness and reasonableness, but to the vigour and eloquence with which he has pursued the cause, even if it has turned him grey. It is particularly good to see the Minister here to respond to the debate, as he is not only my hon. Friend but an old friend of mine who will, I know, display in this matter as in others his typical commitment to doing the right thing.

As my hon. Friend the Member for The Cotswolds (Geoffrey Clifton-Brown), among others, has said, the debate is about fairness. We all acknowledge the overall financial challenges that the country faces; today, we ask for fairer distribution of the money available—a point made with typical eloquence by my hon. Friend the Member for South Suffolk (James Cartlidge). My county of Leicestershire—to continue a refrain we have heard from many hon. Members about their own counties—does particularly badly under the current arrangements. It secures about 10% less per pupil than the national average, which comes to hundreds of pounds. Despite that, Leicestershire schools and the dedicated teachers who work in them—I say that as the son of two teachers, who are now retired—do a first-class job for the children of the county and my constituency. They get good results, they provide a good education, and they give young people the good start in life that is vital. However, they do that under financial pressure and that makes their job much harder.

I recently visited the excellent Thrussington school in my constituency. Like many other small village schools it finds it extremely difficult, if not impossible, to meet the demand for places for local children. That is not just because it is such a good school, but because demographic change and increasing numbers of people living in the area make it physically impossible. Consequently many local children must travel some distance to school. That is not fair to the staff who are coping with a full school, or to the parents who cope with additional costs and hassle in their daily lives getting around and getting to work. It is certainly not fair to the children. When I visit the Latimer school in Anstey tomorrow, I dare say I will hear a similar story.

I welcome the Minister’s comments, in an intervention, that there have been two funding uplifts under this and the previous Government, but that highlights the fact that the time for fixes is past and that we need a proper formula overhaul that will deliver a sustainable long-term solution for fairer funding in the coming decade. My hon. Friend the Member for Cheltenham (Alex Chalk) noted the need for a timescale for dealing with the issue, and he is right. I suggest, as have many hon. Members, that the time is now.

The Government have done a lot to help make funding fairer. Like other hon. Members, I am grateful to the Minister and the Secretary of State for their part in that, but, speaking for my constituents, there is more to do. Let us seize the opportunity to deliver fairness and ensure that my constituents get the best start in life, as they deserve.

15:26

[Mary Robinson (Cheadle) (Con)]

I add my thanks to those that have been offered to my hon. Friend the Member for Beverley and Holderness (Graham Stuart) and the right hon. Member for Exeter (Mr Bradshaw) for securing the debate. I welcome the opportunity to speak on the critical issue of fairer funding for schools.

The fair funding campaign deserves recognition for its valuable and important work, lobbying relentlessly for almost 20 years to close the historical gap between the highest and lowest-funded local authorities. My constituency has some fantastic schools, many of which I have had the pleasure of visiting, but Stockport receives rather less funding per pupil than the national average, as the hon. Member for Stockport (Ann Coffey) said—£4,229 compared to the national average of £4,550.

When I have talked to school leaders in my constituency, many have voiced concerns about the financial implications of the current funding model, which has left them facing budget shortfalls. An example is Hursthead infant school in Cheadle Hulme, which is a three-form entry school with 270 children on the roll. I had the immense pleasure of visiting the school in September and meeting some of the staff and pupils. The headteacher, Jane Driscoll, and the entire governing body team do a fantastic job of leading the school. Hursthead is rated outstanding by Ofsted, but its delegated budget is £892,000, with a total income per pupil, excluding the pupil premium, of £3,304. That is £1,246 per pupil less than the national average, and significantly less than other figures that have been mentioned.

Hursthead is an example of an excellent school working hard to do more with less, but members of the governing body have contacted me to outline the significant cost pressures that the school, like many in the area, faces. Those include repayment of loans that were urgently needed to replace temporary classrooms, and the costs of repairing a leaking roof—a problem common in many primary schools of a certain age. We should remember that excellent schools rely on excellent teachers and that they, too, come at a cost. It is vital that schools are able to retain them. My hon. Friend the Member for Chippenham (Michelle Donelan) was right when she said that an inspirational teacher can change lives. That is why we need to make sure there is funding for them.

When the school governors spoke to me, they said that the current levels of income and expenditure are not compatible with a budget surplus. There are significant pressures on schools that are attempting to manage a growing budget deficit. Measures to balance the budget by limiting expenditure on IT equipment and postponing the purchase of a range of vital resources could be entirely avoided if the fair funding disparity were addressed. My concern is that if the funding position does not improve, those are the types of measures that many schools may need to take.

It is vital that the high level of education provided by that school and many others is not compromised, but that school is just one example of a school in my constituency that is constantly fighting the entrenched, historical imbalances in the education funding model. Other schools across Cheadle are facing similar pressures—indeed, that is the situation faced by schools across the constituencies of all the Members who are here in Westminster Hall today. We all share the same ambition—to see those imbalances addressed—because ultimately, if they are not addressed, it will be pupils and their education that will suffer.

I am here today because I believe that it is imperative that the Government address this disparity. I am heartened by the Secretary of State’s reaffirmation of her commitment to close the funding gap. I urge the Minister, along with his colleagues at the Department for Education, to maintain their momentum on this issue. I welcome the news that the Department is to begin a consultation—I believe it will start next year—and I know that it is currently engaged with the Treasury on the spending review. I urge Ministers from both Departments to look favourably on school funding, not only for the sake of Hursthead infant school but for the sake of all the schools in my constituency and across the country.

15:31

[Kevin Foster (Torbay) (Con)]

It is a pleasure to serve under your chairmanship again, Sir David. I congratulate my hon. Friend the Member for Beverley and Holderness (Graham Stuart) and the right hon. Member for Exeter (Mr Bradshaw) on securing this debate.

Thanks to the good education that I received, I know that 5 November is quite an ominous day to be giving a speech in Parliament, but thankfully I am not a king and it is not nearly four hundred years ago, so perhaps we will be safe today.

It was interesting to hear my hon. Friend the Member for Wells (James Heappey) talk about aiming for mid-table mediocrity in the premier league; I think that at the moment Torquay would be happy to be in the league.

Coming on to the serious point, I am delighted that this debate has been secured so that we can talk again about the unfairness in the current funding system. That is why I am particularly delighted to see my hon. Friend the Member for Worcester (Mr Walker) here today. I know that he will be noting down every point made today, given the impact of this issue on his own constituency and his own lengthy record of campaigning about it.

I will focus on the fact that there is a need for a fairer settlement and a fairer funding system overall. It is tempting to get into Torbay versus Tower Hamlets, or Torbay versus Plymouth, but for me this issue is actually about having a fundamentally fairer system for the allocation of resources, and not a system based on history. In 10 or 20 years’ time, thanks to the massive success of the long-term economic plan for the south-west, Torbay might have become one of the most prosperous parts of the country, so the formula may change and changes made now might not help us in the future. However, I would like to see change, because this is fundamentally about fairness—allocating today’s resources to today’s priorities, and not funding according to historical council spending patterns or considerations that might have been relevant once but are now distant.

What particularly brought this situation to light was the Public Accounts Committee report on the pupil premium, which discussed the fact that the funding for deprived pupils with exactly the same needs can vary by up to £3,000 per pupil. That is a staggering difference and, as our report concluded, such variations make it much harder to bring effective strategies to bear.

[Graham Stuart]

Does my hon. Friend agree that it is not just the Minister whom we are challenging today? It is delightful to see the hon. Member for North West Durham (Pat Glass) representing Her Majesty’s Opposition, as today is also an opportunity for the Labour party to set out that it is committed to fairer funding and accepts that there will be the need for redistribution; it will be painful, but it is right that it should happen.

[Kevin Foster]

Yes indeed, and let us be clear that the council that would benefit the most from the F40 proposals is Barnsley. If one was looking for an example of an area that one would have thought the Opposition would be committed to wanting to do something for, it would be that one.

For me, this is not about wealthy parts of the country versus deprived parts of the country. There are parts of my constituency that are quite wealthy, but they are the older parts—the places that are less likely to have young families with children going through school. The areas in my constituency that are the most deprived and that have the most challenges are the ones that have the most young families with children going through school. I was delighted to hear my hon. Friend the Member for South Suffolk (James Cartlidge) make the point that education is the ladder out of deprivation.

[James Cartlidge]

It is very kind of my hon. Friend to refer to my comments. He is making a very interesting point about overall prosperity. Is it not the case that the levels of deprivation in places such as Tower Hamlets and Hackney were once much higher than they are now, and actually what is happening is that inner London has become relatively far more prosperous, partly because of the housing market and partly because of the City and so on, whereas parts of our constituencies have not caught up at the same pace? That is the underlying change that justifies the demand for fairness.

[Kevin Foster]

I totally agree with my hon. Friend. We need up-to-date information and an up-to-date funding formula. Let us be candid: a hundred years ago, Liverpool was a booming port that was producing a tax surplus. Now, the situation there is the other way round, because of changes in industry. It would be strange to hear arguments that we should base funding today on what the economy was like a hundred years ago. Equally, if we do not change the formula and do not move on, people can find themselves living in areas that were once deprived that still receive extra support even though they are no longer deprived.

This is about making sure that pupils are fairly funded, because even in the most prosperous parts of this country there will be families who are struggling and who need the ladder of opportunity that good, solid education provides, so that they can get the jobs and the skills, and share in the aspiration that many of us have.

[Graham Stuart]

My hon. Friend is very generous in giving way to me again. It is also important that people outside this place do not think that this issue is about stopping recognition of deprivation. The pupil premium exists precisely to meet the needs of those in deprivation, but we must ensure that there is not double-counting of deprivation and that we have a system that is fair to every child, wherever they live.

[Kevin Foster]

Absolutely. I agree with my hon. Friend that what we want is the funding following the need and not following the postcode that people happen to live in. That is why the pupil premium was introduced and it is why the PAC was right to highlight a £3,000 difference in pupil premium funding based not on need or the type of education that a school has to provide or the facilities it needs, but on the different postcodes in which pupils live. Nobody feels better off because they move from one postcode to another; nobody says, “I’m feeling hugely better off because I’ve moved a couple of hundred metres down the road and I’ve crossed a municipal boundary.” People feel better off if there is actually more money in their pocket and more income in their household. It is right that our funding formula should follow the need and not historical funding allocations.

That is not to say that schools in my area are not doing well. There are schools, such as Curledge Street academy and Ellacombe academy, that do extremely well and that have really turned around, partly due to the academies programme during the last few years. They deliver excellent results and give students the ladder of opportunity that we all want to give students. We want to send a message to them that a fairer funding scheme is on its way.

That is why the Government’s actions over the last five years are very welcome. They have made a difference. I accept that things cannot change overnight, but what we want to see is what the PAC called for, which is a timetable to resolve this issue, which we can then use to move forward.

This is not about rural versus urban, or about the north of England versus the south of England. We can see that in the diversity of constituencies that are represented in the debate today, ranging from Stockport to the south of Devon. This is about fairness, and having resources allocated on the basis of need and not on the basis of historical anomaly. That is why it is right that we have had this debate today; that is why I hope the Government will now take things forward and find a solution; and that is why I am pleased to have spoken in this debate.

15:39

[Carol Monaghan (Glasgow North West) (SNP)]

It is a pleasure to serve under your chairmanship, Sir David.

I congratulate the hon. Member for Beverley and Holderness (Graham Stuart) and the right hon. Member for Exeter (Mr Bradshaw) on securing the debate. As a physics teacher for more than 20 years in Glasgow, listening to the debate has been absolutely fascinating for me. Our two nations are so closely linked, but our education systems and the funding of them are poles apart. I have learned quite a lot this afternoon and scribbled lots of notes. I would like to make some comments, some from a personal perspective, on the points raised and to point to things that have been done in Scotland that may be worth considering.

Scotland has neither the funding variations that we have heard about today, nor the discrepancies. There are slight differences in some places such as in the highlands and islands, where teachers might be encouraged to work with relocation funding—it supports them in setting up a new home—but other than that there are not great discrepancies. There are differences between rural and urban schools in Scotland, but figures of £2,000 sound incredible to me, and I am amazed that the issue has not been dealt with.

It is not just that there are discrepancies in funding; I think there is a real underfunding of education, and that is one issue that has not been addressed. I have just looked this up, but the Institute for Fiscal Studies estimates that the average funding per pupil in England—Members can correct me if I am wrong—sits at about £6,000. The average in Scotland is £6,738. I would argue that the average probably needs to be even more in Scotland, but it is about where Governments decide to spend money. Education and closing any attainment gap are at the heart of the Scottish Government’s agenda. To combat the effects of poverty and to ensure that children have the best possible start in life, the Scottish Government have invested £329 million in early years education.

[Kevin Foster]

Does the hon. Lady think it would be worth while if a pupil premium was introduced in Scotland, similar to that in England? Through that, the money would follow the pupils with need, rather than the areas in which they live.

[Carol Monaghan]

It is interesting that the hon. Gentleman mentions that. When he was speaking, I made a note that this pupil funding is now being introduced in Scotland. The Scottish Government are looking at directing funding to where it is most needed: to pupils in deprived areas. That has already been done. Another thing that has been done in Scotland is the continuation of the education maintenance allowance to ensure that 16 to 18-year-olds from deprived backgrounds remain in education. That has been expanded to include students in further education colleges. There is a recognition in Scotland that funding must follow pupils.

[James Heappey]

The hon. Lady is giving us a very interesting explanation of how education works in Scotland. It is encouraging to hear that Scotland uses levers such as direct pupil funding through the maintenance allowance to help those who have particular hardship, but that is underpinned by a standard formula across the country. We should learn from that south of the border.

[Carol Monaghan]

The hon. Gentleman makes a good point. That is what I was trying to say in my opening remarks: Scotland does not have the massive discrepancies that seem to be present in the constituencies of other Members.

[Mr Gyimah]

I thank the hon. Lady for raising two particular points about Scotland: overall funding and attainment. To put the record straight, while the UK Government protected schools funding in real terms in the previous Parliament, the Scottish Government cut funding in real terms. It is worth getting that on the record. On attainment and narrowing the gap, she will be aware of a recent independent report from the Commission on School Reform, whose members are Scottish education experts. The report raised serious questions about the Scottish Government’s ability to close the attainment gap north of the border.

[Carol Monaghan]

The Minister must have different figures from me, because across Scotland we are seeing the attainment gap reduce and pupils from more disadvantaged backgrounds being more successful in accessing higher and further education than ever before.

One of the great things this afternoon has been the positive language used about the teaching profession, which is reassuring to hear. Often teachers hear phrases like “failing schools” and “poor teaching”, and they end up being blamed for a lot of society’s problems, rather than credited for the work they do in trying to tackle the very same problems. I am reassured by what I have heard, and I suggest to all Members here today that they continue to use that positive language, because it makes such a difference to teachers.

The hon. Member for Beverley and Holderness talked about flat cash and not wanting to increase the education budget. I would argue with that. Governments have difficult choices to make, and they decide where money is spent. If education is a priority and our young people are valued for the contribution they can make to the country, we should be investing properly in education.

[Graham Stuart]

It is worth putting on record that with the number of pupils expected to increase by 7% in England over this Parliament, there will be a 7% increase in cash terms in the schools budget. That is in the context of a need for a big readjustment across Government spending to take us into surplus and not to give the very children we are trying to educate further debt to shoulder in years to come.

[Carol Monaghan]

I thank the hon. Gentleman for that. He spoke about the discrepancy between neighbouring schools in neighbouring areas, which was a real eye-opener for me. We do not have those discrepancies in Scotland, but I imagine they impact on parental choice on the schools they wish to send their children to, which is an issue.

The right hon. Member for Exeter talked about further education underfunding. We have to consider that education does not always stop on leaving school. Different pathways are open to our young people in education. For many young people, especially those from disadvantaged backgrounds, further education offers a pathway for them to continue their education.

[Mr Bradshaw]

Is it not the case that the SNP Administration in Scotland have dramatically cut funding for further education to fund their so-called free higher education for university students? The hon. Lady claims that Scottish pupils are performing better than English pupils with higher funding, but her Government’s recent report showed that reading standards for eight and nine-year-olds have fallen by 5% since 2012. Her Education Minister, Angela Constance, has said that Scottish children are not doing as well as they should be. That is why the Scottish Government have put in place the measures to which the hon. Lady just referred—their record is appalling.

[Carol Monaghan]

The right hon. Gentleman raises some points that have been raised time and again. Difficult choices had to be made on college places. Places were cut—places that were not leading to employability and places that did not give our young people the best chances. Tough choices had to be made, and places that led to employability were protected. The overall number of college places has not changed; the range of courses may be different.

The right hon. Gentleman mentioned attainment dropping since 2012. It is interesting that we see attainment dropping at the same time as austerity was biting. We cannot separate attainment and poverty. The two are inextricably linked. As soon as we see austerity, we see issues with our children.

[Graham Stuart]

Will the hon. Lady give way again?

[Carol Monaghan]

No, I am fed up of giving way. [Laughter.]

I have already mentioned the targeting of pupils in deprived areas, which is really important. Early intervention and the Scottish attainment challenge, which is supported by a £100 million Scottish attainment fund, are targeted at primary school pupils in deprived areas to ensure they are able to reach their potential.

The hon. Members for Stockport (Ann Coffey) and for Shrewsbury and Atcham (Daniel Kawczynski) talked about all the extras that may go when education funding is tight. There was mention of outdoor education and parents raising money. Another issue is that teachers end up buying resources for the school. Teachers’ salaries are not at the levels they should be, and if they have to eat into their salaries to buy resources, that is a huge issue, so we need to think about that.

Various Members mentioned teachers’ pay. Again, this is another fascinating point for me. The hon. Members for Banbury (Victoria Prentis), for Louth and Horncastle (Victoria Atkins) and for Cheadle (Mary Robinson), to name but a few, mentioned issues with attracting highly qualified, good teachers to their schools. In Scotland, there is parity for teachers’ pay across all local authorities and schools and pay is set by the General Teaching Council for Scotland in collaboration with the unions, so we do not have the same issue. A similar situation in England might make a huge difference to some of the problems that have been discussed.

I am almost finished, but I want to pick up on something that the Member for Tiverton and Honiton (Neil Parish) said. He described his constituency as the most beautiful in the country. Although I have not been there, I accept that that is true in his country, but in my country, there are many more beautiful constituencies.

As education is a devolved matter, I have suggestions, not questions. First, ensure that teachers are valued and that they understand that value by continuing to use positive rhetoric, and by ensuring that wages are set at a level standard across the country. Intervention for pupils with particular difficulties, who are disadvantaged by poverty or background, should continue. If that needs funding, it should be funded. If the Government are truly interested in ensuring a level playing field, not only across the country but for pupils from different backgrounds, I suggest that reinstating the education maintenance allowance for 16 to 18-year-olds from deprived backgrounds would make a huge difference in allowing them to remain in education and to access further and higher education.

15:54

[Pat Glass (North West Durham) (Lab)]

It is a pleasure to serve under your chairmanship, Sir David. I hope my voice will last out. I congratulate the hon. Member for Beverley and Holderness (Graham Stuart) and my right hon. Friend the Member for Exeter (Mr Bradshaw) on securing this debate. I also thank the Backbench Business Committee for making time for the debate. It is a pleasure to follow the hon. Member for Glasgow North West (Carol Monaghan), but I have one comment on her remarks. I am from the north-east of England and we used to look enviously over the border at the quality of education in Scotland and the outcomes for Scottish children. We do not do that any more.

The debate has been really interesting, especially the way in which Members have lined up one after another to say how far they are down the financial league tables. I noticed that Tower Hamlets was highlighted quite a few times. I remember visiting a couple of schools in Tower Hamlets with the hon. Member for Beverley and Holderness and the current Chair of the Education Committee, the hon. Member for Stroud (Neil Carmichael), when we were carrying out an investigation into sport in schools. We visited a couple of schools in Tower Hamlets and were struck by the huge level of problems that the teachers faced. About a third of the children were in receipt of the pupil premium, but what struck us most was that almost half of the children were the children of the working poor who did not qualify for the pupil premium, and yet in many cases their disposable income was less than that of the parents of those who did. We were told that many of the parents had two or three jobs and often did not have the time or sometimes the skills to be able to support their children in education. I do not think any of us came away thinking that the money those schools got was not needed or was wasted.

The matter has been debated many times and the coalition Government promised to address it in 2010. Like many of the things we think are easy, they are far from easy. I feel for the Minster, because this is not going to be an easy circle to square.

[Mr Gyimah]

Except with your support.

[Pat Glass]

Before the election, Labour also promised to introduce a review of school funding. We want to support the Government as they move forward with their review, but we are clear that funding has to be fair and just. It cannot simply be a recycling or shifting of existing resources within the system from those with greater needs to those with less great needs. One or two people said that children with the same levels of need must receive the same levels of funding. We support that in principle, but we want to see new money in the system.

The basic inequalities in the system go back a long way. My right hon. Friend the Member for Exeter was absolutely right when he said that its roots lie in the old standard spending assessment. I read the Hansard from the previous debate just before the election. The then shadow schools Minister, my hon. Friend the Member for Cardiff West (Kevin Brennan), said that the formula was known only to three people and

“one was dead, one had gone mad and the other one had forgotten”.—[Official Report, 10 March 2015; Vol. 594, c. 260.]

I am not sure where I fit into that, but there are advantages to being around the education system for a long time and having some degree of shared memory of all this.

[Graham Stuart]

Will the hon. Lady give way?

[Pat Glass]

I will just finish this point and then I will be happy to give way.

Historically, local authorities that prioritised education and spent above standard spending assessment—sometimes a great deal above SSA—were often metropolitan authorities that had their funding simply rolled forward into the schools block of the dedicated schools grant, and those authorities, often counties, that spent at or under—sometimes significantly under SSA—had their underspends rolled forward into the schools block of the SSA. Those are the roots of why we are where we are today.

[Graham Stuart]

I am grateful to the shadow Minister for giving way and I congratulate her again on her post. She said she would expect new funding to come into the system. Was she ruling out redistribution? It is politically difficult. The previous Labour Government did not want to go there: although many Labour areas would benefit, perhaps more would lose. I recognise the political difficulty, but surely similar children in similar schools in similar circumstances should get similar funding. If we accept the principle and accept that it is wrong now, we have to accept redistribution. Does she accept that principle and support those of us who, like the Minister, will have to take the difficult decisions?

[Pat Glass]

I will address that point as I make my argument.

It has been made clear today that however we came to be where we are, we all now agree that pupils with similar or the same needs throughout the country should not receive such different levels of funding. It is less clear how to resolve that, and it will not be easy to achieve. The Prime Minister has decided not to protect the entire education budget in real terms. The Institute for Fiscal Studies has highlighted that over the course of this Parliament per-pupil funding will fall for the first time since the mid-1990s, which will make it that much harder for the Government to deliver a genuinely fair funding system.

The Secretary of State told the House last week that the Government remain committed to implementing their manifesto pledge to make funding fairer. She told us that she will protect the schools budget, which she has promised will rise as pupil numbers increase. The IFS says that that is not going to happen, but we will give her the benefit of the doubt. She also highlighted the progress she has made in providing the additional £390 million this year for those areas with the lowest levels of funding, and said that that will continue next year.

But that is the rhetoric. As the hon. Members for Beverley and Holderness and for Shrewsbury and Atcham (Daniel Kawczynski) said, the reality in schools is very different. According to the latest National Union of Teachers survey, 60% of school representatives stated that teaching posts have been lost in their school; more than 60% stated that classroom support posts had been lost; and 55% stated that other support posts had been lost. Nearly 60% reported larger class sizes; more than 65% reported a reduction in spending on books and equipment; and nearly 45% stated that teachers were paying more for materials than they were previously. Of particular concern to the Members who mentioned it in their speeches will be the fact that 50% reported cuts in support to pupils with special educational needs. Respondents also noted a greater reliance on non-qualified teachers and teaching assistants.

Although we all agree with the principle that pupils with similar levels of need should receive broadly similar levels of funding, the Minister should reflect on some of the very real concerns that Members have raised today when he is considering the matter and ensure that any further changes are not only fair but just. Like the hon. Member for Gloucester (Richard Graham), I am interested to hear how it is going to happen, how it will be paid for, and what the time scales will be. I want to hear the what, the when and the how.

Schools are grateful for the additional £390 million allocation, but we must be clear that it is not new money and has come largely from a 25% cut in funding to the 18-plus pupil-funding stream and from the massive cuts we have seen to further education funding, with further massive cuts to come. Pupils who access FE or remain in school over the age of 18 are often pupils with SEN, vulnerable children, or children who simply learn more slowly and need an extra year or two to get to the level of their peers. They are the children closest to being NEET. It is neither fair nor just to take funding from that group of children to distribute across the rest of the sector, and it is not fair to take funding from other less well-off parts of the education sector. We particularly do not want to see another smash and grab on the FE sector.

I agree with fair and transparent funding in principle, but I repeat that new money is required. Funding must be fair to other parts of the system, especially those parts supporting children with SEN, looked-after children and other vulnerable children. It needs to be fair to the higher education sector, and particularly to the FE sector, given what has already happened. It must be fair to rural areas with small schools, which have been mentioned by a number of Members. My constituency is rural and has a school with just 12 children. The very existence of such small schools would be threatened by a system that makes no financial allowance for size. There will have to be transitional arrangements to ensure that no area or school loses out heavily.

I want to give the Minister the benefit of my experience, which I feel I will be giving him quite a lot in the months to come. I have a little time, so I will give him two examples. I remember being involved in a local authority where we wanted to change the funding system to make allowances for children from black and minority ethnic backgrounds. We made what we understood to be a small tweak to the system that resulted in a big change, with funding going to a school that was educating the children of the directors and senior managers of a Japanese car factory. They clearly did not need the money. The Minister should be aware that there can be unintended consequences.

More importantly, I do not know whether other Members remember, but in around 2005, schools started to scream that their local authorities were not handing over funding—that it was being top-sliced. The Blair Government at the time responded by naming and shaming local authorities, which then started to scream that it was unfair and was not happening. Someone had the bright idea that it was SEN funding: “SEN funding has gone up massively; that’s what’s causing this.” There was an investigation, and it turned out that an accountant in the Treasury had tweaked a tiny bit of the formula here, which had a massive impact over there. Whatever happens, the Minister must be clear that the changes are properly consulted on; that we know exactly who will be the winners and losers, and by how much; that they are piloted; and that there are transitional arrangements over a period of time.

The Chancellor and the Minister are in real difficulty. Perhaps Government Members did not see, but the Secretary of State’s face was a picture when the Prime Minister promised to continue the infant free school meals programme at PMQs last week. We hear a lot every week about the promise of 30 hours of free childcare, but that is already under-funded by £l billion. I have sympathy for the Minister, because I have been in his position, albeit to a lesser extent. I have been the person who has had to deliver good and outstanding services, but who had to balance the budget amid all the cries for additional money.

I ask every Member present who has called for fairer funding for schools to remember where the last tranche of funding came from—a smash and grab on FE. Every one of us has an FE college in our constituency. We know that they have been hit massively already and are facing a further 24% cut in funding. Our colleges have been more than decimated by cuts, and we do not want to see more. All Members present will want to see a new funding system that is fair and just to all children and all sectors. With that, I am happy to sit down and let the Minister try to square the financial circle.

16:06

[The Parliamentary Under-Secretary of State for Education (Mr Sam Gyimah)]

It is a pleasure to serve under your chairmanship, Sir David. I thank everyone who has spoken in this rather lengthy but none the less constructive debate, and congratulate my hon. Friend the Member for Beverley and Holderness (Graham Stuart) and the right hon. Member for Exeter (Mr Bradshaw) on securing a debate on this important issue. I also thank the F40 for a long and vigorous campaign.

When I was given this job, I spoke to a senior civil servant in the Department for Education who said to me that someone was working on fair funding for schools when he joined the Department in 1991. The problem has been around for a very long time. It did not arise overnight and it bedevils many different types of authorities. This is not a partisan issue: Labour-held authorities have funding issues, as do Conservative-held ones. There are some underfunded inner-city authorities and there are underfunded authorities outside of cities. I thank all Members for the manner in which the debate has been conducted. It has not been party political; instead, we have focused on the issues in our constituencies.

[Neil Parish]

I understand the historical element, which my hon. Friend the Minister outlines well, but I have huge confidence that he will be the Minister who, after all these years, actually sorts this out.

[Mr Gyimah]

I thank my hon. Friend for his confidence in me. It feels rather strange to be urged to be “brave”, as Sir Humphrey would say.

To address the point made by the shadow Minister, the hon. Member for North West Durham (Pat Glass), if one represents a local authority such as hers in Durham, which is the 57th best-funded local authority in the country, one has the luxury of saying, “It’s difficult, but we have to do all these things.” She does not have to take the difficult decisions. She has the luxury of having a local authority that is very adequately funded, but those Members representing local authorities that have been underfunded for more than a decade, where schools are doing quite well with limited resources, are saying that it is time to rectify the situation. It is right that we listen to them and act.

Before getting into the detail of that issue, I want to respond to the point made by the hon. Member for Glasgow North West (Carol Monaghan). The Government recognise the importance of long-term investment in education to prepare children for success in adult life. In the previous Parliament, we invested more than £190 billion in our schools—a real-terms increase every year. In this Parliament, we will continue to protect the schools budget, as we promised in our manifesto. We will also ensure that the money reaches the places where it is needed, so all children in all age groups and all locations can access excellent education. We committed in our manifesto to making schools funding fairer, so that every school can support every child in achieving their potential.

The right hon. Member for Exeter made that point extremely well when he highlighted the fact that the root cause of this issue is historical funding. At some point in history—2005, I think—we froze schools funding in aspic, and whatever an authority spent the previous year became the baseline for its funding allocation. Demographics, local authorities and schools’ needs changed, but the funding formula was not updated to reflect current need.

[Mr Bradshaw]

A question has occurred to me during this debate. Broadly speaking—I know this is a simplification—Conservative shire counties had lower education funding and lower council tax, while Labour urban authorities tended to have higher education funding and higher council tax. Given the Government’s policy of capping increases in council tax, has any work been done in the Minister’s Department on the potential impact of redistribution on council tax? It would be unfair for people living in Labour authorities, which have historically had high council tax and high education spending, suddenly to lose that money through central Government, and for people in low-spend, low-council tax Tory areas to have no increase in their council tax but suddenly to have a big increase in their schools funding.

[Mr Gyimah]

As the right hon. Gentleman knows, there has to be a referendum for a council tax increase of more than 1.99%. We are talking about how central Government deal with revenue funding for schools. We have got to the point where schools’ capital needs are based on need. If the schools in a constituency have serious problems, we have a thorough process for identifying their needs and allocating funding appropriately, but we do not have a similar process on the revenue-funding side.

It is patently unfair that Knowsley receives nearly £750 less per pupil than Wandsworth, given that more pupils in Knowsley are entitled to free school meals. It is unfair that a secondary pupil with low prior attainment would attract more than £2,000 in Birmingham but only £35 in Darlington. In four local authorities they would not attract any funding at all. That is not right. The hon. Member for Stockport (Ann Coffey) spoke very clearly about that injustice.

In the previous Parliament, we took a big step. To those who say that the Government should be brave, I say that we have been brave. In an era of austerity, we invested £400 million to help level the playing field.

[Graham Stuart]

The £390 million is in its second year, and that will be the baseline. Will the Minister consider looking at the allocation again, because only a little more than half of it went to the lowest-funded authorities? If those that should not have had it have only recently received it, their pain in losing it will be less. The £390 million could be repurposed to lift up the lowest-funded authorities together. That would remove the outliers, even before we get to the national funding formula.

[Mr Gyimah]

I thank my hon. Friend for that point. I agree with the hon. Member for North West Durham that this is a complicated area. What happened with the £390 million is that local authorities whose spending was low on the high needs block but high on the schools funding formula did not see the full benefit, because the £390 million was allocated purely on the basis of schools funding. That means that any reform in this area has to take into account the different blocks of the dedicated schools grant: schools funding, high needs and early years. Some local authorities shift money among those different budgets, so we must look at this in the round.

Let me return to the difference that the £400 million has made. Buckinghamshire received a further £80 million and Cambridgeshire received more than £23 million, or £311 for every pupil. Bury, Surrey, Shropshire, Salford and more than 60 other authorities benefited from additional funding for their schools. Money was not being shuffled into Conservative areas from other local authorities. The beneficiaries of the £400 million, which is now the baseline, are underfunded local authorities. We looked at underfunding based on characteristics; we did not pick an arbitrary number.

[Graham Stuart]

Westminster was a beneficiary, was it not? I may have got that wrong. Clearly, the money was not always going to the lowest-funded authorities. Only a little more than half went to the lowest-funded authorities. There is a real opportunity to look at this again.

[Mr Gyimah]

As my hon. Friend knows, we are having this debate because the Government want to go further than £390 million. The changes in some hon. Members’ constituencies over the past 10 years have been significant. In Dorset, the funding schools receive does not reflect the proportion of pupils eligible for free school meals, even though that proportion has almost doubled. In Lincolnshire—this relates to the point made by my hon. Friend the Member for Louth and Horncastle (Victoria Atkins)—the proportion has doubled, but the funding has not changed at all. In other areas, the number of children eligible for free school meals has gone down by 40%, but the authority still receives the same amount of funding. The distribution of funding today does not reflect the needs of our children, so it has to be changed.

It is widely recognised that the impact of the distribution is hugely unfair, as many hon. Members have said today. A child who goes to school in Trafford will attract £4,228, but in next-door Manchester they will attract £5,081. At the extremes, Wokingham—my right hon. Friend the Member for Wokingham (John Redwood) is no longer in his place—receives £4,151 for every school pupil, while Tower Hamlets receives £7,000, or 70% more. Of course, we have to ensure that Tower Hamlets receives the funding it needs, based on the characteristics of its pupils, to enable its schools to do their job, but a discrepancy of 70% or more shows that rooting the funding formula in the historical allocation has allowed things to get out of kilter.

As I said, we have made some progress, and many schools that are doing an excellent job are benefiting. I want to draw hon. Members’ attention to York, because my hon. Friend the Member for York Outer (Julian Sturdy) is here. It is one of the lowest-funded authorities in the country, yet 86% of its primary pupils and 93% of its secondary pupils are in good or outstanding schools. I congratulate the teachers in York on the excellent work they are doing. However, schools in York could do even more to help us in our mission to build a world-class education system if their funding matched the schools’ and pupils’ needs.

A system in which a school can get 50% more money for providing the same education to the same pupils just by moving from Barnsley to Hackney is not fair to schools, parents or children. To be fair to taxpayers at a time of austerity, we need to ensure that we get the most out of every pound we spend on our schools. Although we have protected the schools budget overall, we will not make the most of it until it is targeted where it is needed.

[Graham Stuart]

Perhaps the Minister is about to move on to what I am going to ask him. Can he set out the principles that will be used, so that we have some idea of the parameters that will be used to determine allocation? This will be politically challenging, so it is important that the terms on which it is done carry the widest possible support across the House.

[Mr Gyimah]

I thank my hon. Friend for his third intervention so far. The good news is that there is consensus on the need for reform, and support for how we plan to get there. Devising the new system will be a big, difficult job. There is no other way of describing it. We are being encouraged to move quickly, but also to listen; the best thing to do as we set out our proposals, soon after the spending review, is consult carefully and widely with local authorities and schools. That will be our approach.

Also, I received the letter sent to the Prime Minister from over 100 Members, led by my hon. Friend the Member for Beverley and Holderness.

[Julian Sturdy]

The Minister is doing an excellent job, as I knew he would, in setting out his case. On timing, many of the excellent schools in my constituency of York, which he mentioned, are having to dip deep into their reserves to get through these years. They simply will not have the time if we do not act sooner rather than later.

[Mr Gyimah]

I share and understand my hon. Friend’s need for urgency, but the first thing is to build consensus for reform. It is good that the National Association of Head Teachers supports reform; it recently said:

“The level of unfairness in school funding has been staggering”,

and that it welcomes the move towards fairer funding. That is echoed by the Association of School and College Leaders, which says that reform is

“long overdue and very welcome.”

Parents know that education should not be a postcode lottery. There is a lot of work to do, and I would like to see the Opposition join the NAHT, and all the other organisations calling for reform, in supporting our building of consensus for what would be a historic achievement for our schools and for constructing an excellent education system.

[Michael Tomlinson]

I am grateful to the Minister for his responses so far. However, if he cannot commit to a specific date, may I invite him to at least set out a timetable allowing our local education authorities to plan well in advance, which will help our schools?

[Mr Gyimah]

My hon. Friend tempts me to pre-empt our spending review; that would not be appropriate for a junior Minister, and would not be welcomed by the Chancellor. I will not set out a timetable, but I have said that we will not only seek to build consensus and to consult widely, but support schools through the transition and encourage efficiency to get the most out of fairer funding.

As well as reforming the funding system, we will push schools to be more efficient in their spending. In this difficult financial climate, it is even more important that schools are relentless in their drive to squeeze the best value for their students out of every pound that they receive.

[Kevin Foster]

I thank the Minister for giving away again. He is being very generous with his time to the Members who are still here to listen to his remarks. I accept that he will not set out a timetable while he is on his feet today, but is he hopeful that the matter will be resolved by the end of this Parliament?

[Mr Gyimah]

What I can say on timing is that, whatever the changes, schools need enough time to adjust and plan; I have heard that from a lot of schools. That will guide us in implementing any reforms.

[Graham Stuart]

2017-18?

[Mr Gyimah]

I will not comment any further on timing. It is important to focus on schools’ financial management, because good management and good attainment can go hand in hand, as demonstrated by the York example. While we will push schools to be more efficient, we will also help them to spend their funds in the way that has the biggest impact on pupil attainment. We will continue to give schools greater freedoms to make the right decisions, for themselves and their pupils, on how their budgets should be spent. We will free up schools to adopt the right structures and practices to meet their specific needs, and help them to identify the areas where they can make savings. We will help schools improve their financial expertise, share best practice and work together more efficiently.

[Neil Carmichael]

This question is not about timing; it is about consulting widely, including with multi-academy trusts and academies, because they are in this together. The Minister has mostly referred to local authorities, but we have to consider all schools.

[Mr Gyimah]

The Chairman of the Education Committee is absolutely right. When looking at the funding system, we must consider all schools, be they free schools, academies or local authority maintained schools. While on this point, I noted the tests that he outlined, and how his Select Committee will review any proposals that come forward. We will bear those tests in mind as we consider what to do over the coming weeks and months. I thank him for making them and the criteria very clear.

Let me bring my remarks to a close. Fairer funding underpins our vision for a world-class education system. To really support schools, we need to make the funding system fairer for every school and every child. Our vision is of a future in which every school in the country, whatever their characteristics and wherever they are, provides excellent education, allowing every child to succeed. I am enormously grateful to colleagues who have been campaigning hard for this over several years, and thank them for their contributions to the debate. To move forward, we want a real consensus, so I would like to see the Labour party, which did not mention fair funding in its manifesto at the last election—

[Pat Glass]

That’s not true.

[Mr Gyimah]

If the hon. Lady wants to intervene, I will take the intervention. I would like to see the Labour party come forward and support the proposals, because schools in constituencies represented by MPs of both our parties need this problem addressed. We have already protected budgets for 2016-17, and have baked in the extra funding from last year. I hope to be able to update right hon. and hon. Members on our further plans shortly. In the meantime, I encourage all those who have spent years campaigning for fairer funding to continue. We are making good progress. I hope that what we have done so far and the fact that we are willing to listen show that, at last, we are not just talking, and that the Government are ready to act.

16:27

[Graham Stuart]

It has been a pleasure to serve under your chairmanship, Sir David. What a delight this is! It was 10 years ago when I first asked a question about F40 funding to a Labour Minister, and I got a singularly inadequate reply. It was in March 2006 when I got my first debate on this subject. I called for an urgent debate in January 2007, and secured one in May 2007. This has been going on for a long, long time. The Minister and the Government are committed to delivering fair funding for our schools; that is long overdue and very welcome.

I think colleagues would like to hear more about the principles; we will perhaps do so when the Minister comes forward early in the new year—certainly by the end of January—with proposals to be consulted on.

[Mr Gyimah]

No timings.

[Graham Stuart]

We need more on the timing, because while consulting widely and seeking consensus is credible, the Government are committed to this. It does not require consensus; it requires the implementation of the manifesto promise. Seeking consensus is entirely right, but requiring it is a different matter altogether.

Then there is the element of ambition. How far are the Government prepared to go? I think it was a Treasury official who said, years ago, “Minister, the people you make happy, you never make as happy as the people you make unhappy, unhappy.” That is the problem. When we finally get the proposals, we and our constituents will grunt and say, “About time,” but there has to be redistribution; it is unfortunate that the Opposition spokeswoman, the hon. Member for North West Durham (Pat Glass), was not prepared to say that. As it is, there has been a 7% increase in the education budget in this Parliament because of the number of pupils. Given the context, there has to be redistribution. Some people will lose, which means looking them in the eye and explaining why it is fair and right that they should do so. That takes courage, but if we are going to do it, we could do with both sides of the House joining in and accepting that principle. I welcome Labour’s support for fairer funding, but it needs to be followed by the recognition of the need for redistribution.

In my final seconds, I want to comment on the contribution of the hon. Member for Glasgow North West (Carol Monaghan), the Scottish National party spokeswoman. It seems that the free university education of middle-class children, who are predominantly the most likely to go to university, has been funded at the expense of working-class kids in further education colleges, who have had their vocational opportunities stunted as a result. I do not think that the SNP has much to teach us about that, although they do seem to have more equal funding of schools, per pupil. It seems a good principle to have pretty much level funding, except when the reasons not to are overwhelming, such as higher teaching costs in London. That does not mean, however, that we need have the gross discrepancies that we see today.

It has been a great debate, and I thank all my colleagues for being here. I look forward to the Minister coming forward with proposals as soon as possible.

16:30

Motion lapsed, and sitting adjourned without Question put (Standing Order No. 10(14)).