Education Funding: Southend

Tuesday 21st February 2017 Westminster Hall

11:00

[Sir David Amess (Southend West) (Con)]

I beg to move,

That this House has considered future funding provision for education in Southend.

And now for something completely different, Mr Rosindell—education in Southend, and the impact that the new national funding formula would have there if it went ahead without any changes. I have never been in favour of officer-led local authorities. Councillors are elected; they form an administration and should give instructions to officers, who carry them out. I have never been in favour of civil servant-led Governments. The civil service in this country is wonderful, but Governments are elected and Ministers should be strong enough to tell civil servants what their policy is, be aware of political ramifications and make sure their directions are carried out. I am giving my right hon. Friend the Minister the benefit of the doubt. He and I have known one another a long time and I hold him in great regard; he will not take offence when I say that I do not want him just to read out the civil service brief and palm me off with a lot of nice old platitudes at the end of half an hour. Let there be no doubt: if the proposed changes go ahead I shall vote against the measure needed to bring them in—and we have a majority of only 11. I am not going to mess about on the issue.

In the years since I became an MP I have listened to so many rebrandings of schools that I am sick to death of hearing what we are to call them—academies, grant-maintained and all the rest. We keep coming up with new ideas, but in the end it is down to the leadership of headteachers. I just want all children to be given the best possible opportunity, and I want fairness in the system. Leadership is essential, and I am glad to tell the House that the leadership of schools in Southend is magnificent. Before I turn to the general thrust of my argument, I have a point to make gently to the Minister. I was in Parliament when the community charge was proposed and I do not for a moment regret my support for it. If it had been introduced in a certain way it would have been an enormous success, but unfortunately we listened to the civil service proposals at the time, no exemptions were allowed, and we all know what happened. Eventually the policy resulted in the removal from office of the greatest politician I have ever known. I do not want the new funding formula to end up like the community charge.

My right hon. Friend the Minister will have the same briefing that I have, telling him that the national funding formula is aimed at addressing the unfairness of similar schools and areas receiving different levels of funding, with little or no justification. I am told that it will distribute the majority of funding directly to schools, to ensure that every child with the same needs will receive the same funding regardless of where they live—all very worthwhile. Under the formula, funding will be divided and allocated into four notional blocks—schools, high needs, early years and the central school services block, which is due to be phased in from 2018-19.

A hard national funding formula will, I am told, apply from 2019-20 for each mainstream school’s budget. Its purpose is that there should be a national standard for funding, which will remove the haphazard multiple funding formula in every local authority area. In addition, notional budgets will be calculated for the schools block funding in 2018-19, according to the national formula, using national averages as a starting point, and will be aggregated and allocated to local authorities in line with the locally agreed formula. I am trying to save my right hon. Friend some time, so he need not repeat those things in his reply.

I am not here to support the National Union of Teachers. I am glad that it has a new general secretary; I had no time for the last one, who I will never forget hearing shouting through a loudhailer about accident and emergency unit closures, outside party conference—it was terrible leadership. I hope that the new post holder will provide better and more sensible leadership. However, I am not presenting an NUT brief—or a House of Commons Library brief; the latter are normally the fountain of all truth. I am presenting a brief from local residents, making local points. I should point out that Southend has a Conservative-controlled council under the excellent leadership of John Lamb. The education portfolio is with James Courtenay.

I want now to make the case for changes for Southend. The proposed national funding formula for schools would be likely to have a devastating impact on every school in Southend West. Initially, somewhat naively, I welcomed the NFF as a potential major improvement in the current funding situation, but the weightings and the lack of stress testing have produced shocking consequences. Southend is now one of only four local authorities in which every school will lose out under the new arrangements. That amounts to making it the 11th biggest loser of all local authorities, and nationally the 84th worst-affected constituency. Those figures were given to me in a briefing by Councillor James Courtenay.

The impact of the NFF on schools in my constituency was brought to my attention in December 2016 in a letter from Mr Badger, the chairman of the governing body of Southend High School for Boys, which, together with the other three in Southend, is one of the finest grammar schools in the country. He stated that the proposals would, “shockingly”, see funding reduced by a further 2%. For that school and many others in the borough the proposed changes are bewildering. Southend High School for Boys was recently rated outstanding in every category of its last Ofsted inspection, and was ranked 67th in national key stage 4 secondary school performance for 2016. Moreover, it has demonstrated prudence in budgeting and expenditure, and was even cited in the White Paper “Educational excellence everywhere” last March as a model case study of an efficient school.

While the aim of the national funding formula is, so we are told, to address the unfairness of similar schools and localities receiving different levels of funding through the setting of a mainstream school budget nationally, it fails properly to recognise the differing needs of each school’s cash-per-pupil funding. It will hinder rather than help schools in the area that I and my hon. Friend the Member for Rochford and Southend East (James Duddridge) represent. He may, if he catches your eye, Mr Rosindell, speak about the schools in his constituency.

Illustrative figures suggest that if the hard formula for 2019-20 were to be introduced now, without any transitional protections, schools in my constituency such as Chase High School—which was prayed in aid as a centre of excellence when it was visited by Baroness Morris years ago—would face a £173 reduction in per-pupil funding. That would be a total cash loss of £163,000. Perhaps I may remind the Minister about Belfairs Academy, a wonderful school, which he opened—so he has seen how good it is at first hand. That school would lose £147 per pupil in funding, with a total cash loss of £168,000. Westcliff High School for Girls, where one of my children went, would lose £133 in cash per pupil funding, with a total cash loss of £109,000.

Moreover, even with the NFF 3% floor, schools in my constituency will not see a tangible funding increase for many years to come. Westcliff High School for Girls is set to lose 5.6% of its budget; with the floor in place, that will be reduced to a loss of 2.9% over two years. That school will not receive a further increase in its funding until the difference between the 5.5% and the 2.9% has been reduced through increases to the school’s allocation in the education budget. In short, if the school receives a 1% addition to its funding, there will be no improvement to its cash funding for about five years, which does not paint a rosy picture of fairness.

Primary schools in the area that I represent will also be hit hard. According to Darren Woollard, who is an excellent headteacher and the chairman of Southend Primary Headteachers’ Association, reductions in funding will seriously undermine vulnerable learners who need help the most. Furthermore, the NFF’s funding cuts to early years provision and the impending 30 years will have a major impact on capacity across the borough. I hope my right hon. Friend the Minister will not mind if he has slightly less than 15 minutes to respond; I would like my hon. Friend the Member for Rochford and Southend East to catch your eye, Mr Rosindell.

In essence, the cuts to funding will affect the quality of education and opportunity for pupils from an early age. The reduction in funding is likely to spark a downward spiral for education in the area that I represent, raising the risk of a recruitment crisis in the teaching profession and leading to the closure of schools due to the financial implications of the funding formula—something the Government would certainly not want. On average, £5,000 per pupil is needed to run a secondary school and £4,000 per pupil is needed for a primary school. Where I was brought up, in the east end of London, we did not spend those huge amounts of money on education. We had 56 pupils in a class, and we all managed to spell, write, read and all of that, but times have changed. I accept that all schools now think that the money that they are given is crucial to the quality of their education provision, not only across the country but in Southend in particular.

The NFF’s implementation in Southend will mean that seven secondary schools and 19 primary schools will no longer be financially viable and will ultimately have to close. Southend High School for Boys, Belfairs Academy, Westcliff High School for Boys and Westcliff High School for Girls, which are all academically wonderful schools, will all be needlessly mutilated by the funding formula. The Westborough School, which is a wonderful school in the area I represent under the marvellous leadership of Jenny Davies—it is a tragedy that she will retire later this year—is in a ward with a literacy rating of 2, which classifies it as being in the top 20% for educational need in the country. If the NFF is put in place in its current form, it is likely that that need will substantially increase. Some 23% of the population are 16-plus and have no qualifications in the area that I represent, which also has a total literacy index score of 103, which is above the rate in England and indicates literacy vulnerability.

In many ways, the NFF’s effect on schools in Southend has the potential to raise unemployment, poverty and deprivation in the longer term—especially when the population is projected to increase to approximately 200,000 by 2027. Distortions in the NFF’s calculations for Southend have been highlighted by headteachers in my constituency. Dr Paul Hayman, the wonderful headteacher of Westcliff High School for Girls, has highlighted the NFF’s lack of transparency in not showing the values for area cost adjustment ratios. He cites the fact that the current basic funding unit for a pupil in years 7 to 11 at Westcliff High School for Girls is £4,225, which will reduce to £3,984. Many inner-London schools are still set to be allocated £7,000 per pupil in London, which is a difference of £2,298 per pupil and opens up the question of how that can be justified. I say, as a Londoner myself, that that is just not fair.

Of course, one may claim that school budgets in Southend have been protected in recent years, and that the NFF will redress that balance. However, schools in the area that I represent have tightened their belts over the past seven years by increasing class sizes, reducing administration costs, reducing spending on books, computers and resources and limiting the number of courses offered to GCSE and A-level students. Why should there be more financial affliction for schools in the area that I represent due to this rigid proposed formula?

I end with some thoughts and a solution for my right hon. Friend the Minister. With the consultation closing, as I understand it, on 22 March, I urge the Government to increase basic per-pupil funding. Grammar schools are currently campaigning for basic per-pupil funding of £4,800, and many headteachers in the area that I represent support that. Furthermore, it would be wise if the Government presented an area cost adjustment that was—to use that awful expression—fit for purpose and represented the demographic needs of Southend. Most importantly, however, the Government should introduce a national minimum level of funding per pupil without enlarging the overall schools budget. We do not need hordes of civil servants to advise the Government on that matter; the hon. Member for Southend West is advising the Government to do that.

Although the Government have emphasised the 3% floor in funding drops, along with transitional arrangements in the interim before the hard formula is introduced in 2019, national minimum funding per pupil would guarantee certainty in safeguarding the financial provision of funding per pupil for all schools in Southend, and it would not harm or lead to the closure of schools that have an excellent academic record. I hope my right hon. Friend the Minister will not only have listened politely to what I have said but will actually take notice of the representations that I have made and that my hon. Friend the Member for Rochford and Southend East is about to make.

11:16

[James Duddridge (Rochford and Southend East) (Con)]

I congratulate my hon. Friend the Member for Southend West (Sir David Amess) on his contribution and on initiating the debate. I particularly welcome the Minister, who is a beacon of stability in a Department in which Secretaries of State can come and go. I was an Education Whip during the Minister’s first incarnation as an Education Minister, and it is good to see him back in his proper place as a beacon of stability within that Department.

I welcome the consultation, but for us, NFF stands more for national funding failure than national funding formula. I gently say to the Minister that, if the consultation does not result in changes, it will not pass through the House. My hon. Friend has said that he will not support it; I—as somebody who loyally supports the Government—will not support it if the funding formula does not change, both in relation to Southend and more generally. I agree with the principle of a national funding formula. I understand that an eighth of Government spending is on education so it cannot be an area that we do not look at and review, but it cannot be right that Southend is, as my hon. Friend said, one of four areas in which every school loses out—the only area to do so outside London. That seems wholly unacceptable.

The budget pressures are great. Some 80% to 90% of budgets go on staffing, while pensions and national insurance contributions are rising faster than the rate of inflation, whether measured by the retail prices index or otherwise. These are very difficult times. Schools do more now than they did in the past; year after year, schools are expected to do more with less. It is not just about cutting the obvious things. The excellent headteacher of Hamstel Infant and Nursery School, Mrs Clark, wrote to me to demonstrate that there would be a massive impact on that school’s ability to do what it was already trying to do, and that it was being asked to do more under the funding formula. That is typical of all the other primary schools. Other schools have already reduced the number of older staff, who are more expensive, and have replaced them as they retire early or at the right time with cheaper, younger employees.

If the NFF goes ahead, it will lead to redundancies. Learning support assistants will be made redundant and non-core subject teachers will be made redundant in virtually every school, including Southend High School for Girls, Cecil Jones Academy, Shoeburyness High School, St Bernard’s High School and Futures Community College, in addition to all the primary infants schools. I know that the funding formula does not apply to special needs schools, but there are parallel issues there as well. In addition, we have grammar schools that are underfunded and would benefit from a higher level of basic funding. At the moment, the position is untenable.

I welcome the capital expenditure that the Government are facilitating. I also welcome the work on opening out grammar schools. Roughly 100 grammar school pupils come from the Thurrock unitary area, which is represented ably by my hon. Friend the Member for Thurrock (Jackie Doyle-Price), who cannot speak for herself in the Chamber given that she is a Government Whip. Putting more grammar schools in Thurrock would help Southend, in that more local people—people in not only the Southend postcode but Great Wakering and the broader Essex and Thurrock area—would come in.

The Government must do something. They could do something on the area cost adjustment and on the London allowance. Lots of people will not come into Southend from an area in the outskirts of London where they could be paid more. The Government could do more on funding grammar schools, on transitional arrangements and on arrangements for bulge groups going through, which they are in secondary schools. Without doing that work and without Members of Parliament being on board, the proposals simply will not and should not get through the House of Commons.

11:20

[The Minister for School Standards (Mr Nick Gibb)]

It is a pleasure to serve under your chairmanship, Mr Rosindell. I congratulate my hon. Friend the Member for Southend West (Sir David Amess) on securing this important debate. I am grateful for this timely opportunity to discuss the details of the proposals for introducing a new national funding formula. I have known my hon. Friend for as many years as he has known me, and I assure him that I do not intend to palm him off with fluffy platitudes.

We are now more than halfway through the consultation process on these proposals, and we have heard views from across the school sector and from all parts of the country. Throughout the consultation period, we are considering all representations from local authorities, teachers, governors, parents and hon. Members in this House. We are listening carefully so that we can ensure that the final national funding formula is the right one.

Many Governments have avoided introducing a national funding formula. We have grasped the nettle. It could be argued that in a time of fiscal restraint, we should have avoided introducing a national funding formula, but we think it is right to introduce such a formula and are proceeding with the consultation with the intention of introducing that formula. It is an open and transparent consultation, which is why it includes illustrative allocations for every school and local authority in England, calculated on the basis of figures for 2016-17, to help schools and others to understand the impact of the proposals. Those allocations are only illustrative.

The new formula will apply, as my hon. Friend the Member for Southend West said, in 2018-19 on the basis of a soft formula, which means that the local school forum can alter the allocations within the funding envelope for Southend. We have already announced that for 2017-18, no local authority will see any fall in its funding levels.

We believe that what we are proposing achieves the best balance between the different elements of the formula—between the core funding for every pupil and the extra funding for those with additional needs, and between the funding that relates to pupils’ characteristics and the funding that supports schools to meet their fixed costs. Those are complex trade-offs, which is why we are consulting for a full three months on the proposals.

The single biggest element of the national funding formula will be a basic amount that every pupil attracts to the school. That will account for around three quarters of the total schools block—about £23 billion of the total £40 billion. We are clear that significant funding should be directed through the formula to children from disadvantaged backgrounds who face entrenched barriers to their education. Schools that are educating those children should receive extra resources, so that they can support those children to do as well as their peers. We propose to spend more through the formula than is currently spent on pupils who start school with low prior attainment compared to their peers, so that they can get the extra support they need to catch up.

Overall, we want to maximise the amount of funding spent on factors that relate directly to pupils’ so-called characteristics. Our proposed lump sum of £110,000 per school, regardless of its size, is just below the current national average if we aggregate the 150 local formulae in the country. It is significantly below the sum that Southend uses locally, but we still believe that the lump sum is an important element of the formula. Our proposals recognise that all schools need a fixed element of funding that does not vary with pupil numbers and characteristics, to provide a level of certainty. One reason—it is not the only one—why Southend schools face these percentage reductions is the difference in the lump sum figure.

The decisions we have made in balancing the formula will certainly have different effects across the country, depending on how they differ from decisions that local authorities have taken on their local formula. The anomaly is in the local formulae, rather than in what we are proposing in the national formula. In the case of Southend, the current local formula uses a higher basic per-pupil amount than the figure we propose in the national funding formula. Southend also concentrates funding for deprivation more narrowly. In the national funding formula, we want to spread deprivation funding more broadly and further up the income spectrum, so that we can target additional funding to pupils who are not necessarily eligible for free school meals but whose background may still create a barrier to their education.

We know that some areas and schools will disagree with the balance we have struck in the proposals. That will be the case particularly in areas where the proposed national funding formula will mean a lower level of funding than the current baseline for 2016-17, such as in Southend. We are keen to hear views on whether we have got that balance right and welcome any additional evidence through the consultation. We will look to change our proposals where the evidence shows clearly that the balance needs to shift.

I took on board the advice from my hon. Friend the Member for Southend West, which will trump any advice we receive from experts across the country. He argued for a de minimis funding level of £4,800 per secondary school pupil, and his advice will be considered as part of the consultation process.

While there will be different views about the precise balance of the factors, there is certainly a consensus, as my hon. Friend the Member for Rochford and Southend East (James Duddridge) confirmed, that we need a national funding formula and a fair funding system that gets resources to where they are needed most. No matter where children live and whatever their background, prior attainment or ability, they should have access to an excellent education. We want all children to be able to reach their full potential and to succeed in adult life. That ambition can be achieved only if we have a fair approach to funding, whereby funding relates directly to children’s needs and the schools they attend.

Under our proposals, the funding system will be clear, simple and transparent for the first time. Similar schools will be treated in the same way right across the country. We will no longer see the wide range in funding levels that we see now, and it will no longer be the case that the amount a child attracts to their school depends on where they live or their school’s location. Our proposals will end the postcode lottery in school funding and extend opportunity across the country.

I want to give my hon. Friend the Member for Southend West a minute to conclude at the end if he wishes; if not, I will plough on. I am hugely grateful to have had this opportunity to look closely at how we can ensure fairer funding for our schools. It has been very useful to hear from my hon. Friends for Southend West and for Rochford and Southend East and to take time to consider the important issues that they both raised.

[Sir David Amess]

The thing that slightly disturbs me in what my hon. Friend the Minister slipped in is that it seems as if he is blaming the local authority for the disparity in the figures.

[Mr Gibb]

I am making the point that we are aggregating 150 separate local formulae into one national funding formula, which will inevitably mean there will be changes. That is particularly inevitable, mathematically, if we then illustrate the new formula on the basis of existing figures. However, I understand my hon. Friend’s points. As I said, these are illustrative figures and will have no impact on 2017-18. The overall level of school funding, at £40 billion, is the maximum amount we have ever spent on schools. It will rise in the years ahead. Schools will receive more money if their pupil numbers go up and if their pupil characteristics change. We expect school funding to be at about £42 billion by 2019-20. That does not mean to say that the formula will not have the impact we are illustrating; they are illustrative figures only.

Question put and agreed to.

11:30

Sitting suspended.