Education: Academies Funding

Baroness Jones of Whitchurch Excerpts

Tuesday 21st June 2011 Lords Chamber

Asked By

[Baroness Jones of Whitchurch]

To ask Her Majesty’s Government what are the implications for funding of the academy programme of reports that errors in departmental calculations have led to some academies being overfunded.

[The Parliamentary Under-Secretary of State for Schools (Lord Hill of Oareford)]

My Lords, the current system of funding academies that we inherited is overly complex and needs to be simplified. We have therefore announced a review of school funding. Where there are occasional problems of classification in the current system, we look into them on a case-by-case basis. We want a system where schools with similar characteristics are funded on an equal footing and where academies are funded on the same basis as maintained schools.

--- Later in debate ---

[Baroness Jones of Whitchurch]

I thank the Minister for that reply. Does he recognise that the overpayments that have been made are in some cases considerable, for example equating to around £300,000 per school in Hampshire? Does he agree with his noble friend Lady Ritchie, of the Local Government Association, who said last week that the overspends on academies arose,

“because the government has misinterpreted council education expenditure returns for purposes for which they were not intended”?

Can he explain how the overpayments to academies will now be clawed back? Can he guarantee that pupils in maintained schools will not be penalised by this error, and does he acknowledge that the error illustrates once again the folly of pushing ahead with policies without adequately consulting those concerned?

[Lord Hill of Oareford]

My Lords, as I said in my opening Answer, we inherited the system that we operate for funding academies and for trying to ensure that the basis of equal funding is maintained, and it is inherently complex. It has been in place since 2002 and because it is complex, sometimes the classification of returns under Section 251 leads to difficulties and some of the problems alluded to by the noble Baroness. Our aim is to make sure that funding is provided on an equal basis. Where there are problems of the sort that she mentioned, the department will look into them on a case-by-case basis and, if it is appropriate, make arrangements to claw back money or in some cases pay additional money. Sometimes, the way in which this complex system operates can lead to an academy getting less than it should. We will look at this, and I hope that the funding review of the whole system that we announced some time ago will help to address these problems and enable us to reach a sustainable solution.