Education: Academies Funding

Baroness Walmsley Excerpts

Tuesday 21st June 2011 Lords Chamber

[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.

[Baroness Walmsley]

My Lords, will the Minister bear in mind that some local authorities’ ability to deliver services to schools that have not opted out and become academies is hindered by the fact that they no longer get economies of scale when they purchase services for those schools and therefore they become more expensive? Does he intend to compensate local authorities for that situation?

[Lord Hill of Oareford]

There are a number of complexities in the system. One that is not widely recognised is that, because of the way in which the LACSEG system operates, local authorities continue to receive funding for some services that academies are being funded for. So there is some double funding. It is not that an academy is getting more than it should; it is that, traditionally, the local authority has carried on receiving that funding. We need to look at that and to address all these issues to make sure that the principle of equity is maintained.