School Funding (London)

Lord Hanson of Flint Excerpts

Wednesday 29th March 2017 Westminster Hall

[Several hon. Members]

rose—

[Mr David Hanson (in the Chair)]

As Members can see, a number of right hon. and hon. Members want to participate in the debate. I intend to call the Front-Bench spokesmen at 10.35. I hope that Members will show self-restraint so that everybody is able to take part.

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[Several hon. Members rose—]

[Mr David Hanson (in the Chair)]

Order. We have 30 minutes before the winding-up speeches, and six Members. That means five minutes each, if people can exercise self-restraint.

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[Mr Gibb]

Again, the hon. Lady takes the misleading figures from the National Union of Teachers, which is conflating the cost pressures that all of the public sector is incurring over this year and the next three years—amounting to 8% in total—with the national funding formula. The national funding formula is good for schools in the hon. Lady’s constituency. I hope very much that her local headteachers and she herself will support the new national funding formula, because it is fairer, and fairer for her schools.

[Mr David Hanson (in the Chair)]

Order. I call Siobhain McDonagh.

[Siobhain McDonagh]

I am sure that, when a bill has to be paid, the headteacher is not looking for the reason why it is becoming more difficult for them to do that. Certainly—

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[Andy Slaughter]

If the hon. Gentleman does not mind, I will not, given the time. Government and Opposition Members have said that this is about the overall picture. It seems extraordinary that substantial sums of money should be taken away from schools in deprived areas through the formula funding when other cuts are being imposed.

I agree with what my hon. Friend the Member for Wythenshawe and Sale East (Mike Kane) said from the Opposition Front Bench. The figures from the NUT and other unions should not be rubbished by the Government, but looked at, because they give an overall picture of the cuts that there have been over a number of years, starting as long ago as 2013 and going through to 2020, and possibly beyond.

Let us look, for example, at Ark Burlington Danes Academy, which is a very successful academy with 67% of pupils on free school meals. By 2020, it will have lost 18% of its budget. Hammersmith Academy, which is a new-build academy with 61% of pupils on free school meals, will have lost 25% of its budget. Wormholt Park Primary School, which has 59% of its pupils on free school meals, will have lost 16% of its budget. As the Minister can readily tell, those schools have very deprived intakes and they are losing unsustainable amounts of money.

In addition to the cost pressures, which cannot be separated out as the Minister would like, what will happen if we have the misfortune of the Government continuing this after 2020? The NUT has pointed out that, according to the Government, several schools will still be overfunded. Will they be restricted by not having inflation increases thereafter? What are the plans? In my constituency a number of schools will still be said to have, once the floor is imposed, funding that is 10% above what they should have, and in one case, 31% above. How are those figures in any way realistic or sustainable for schools to cope with?

Given the amount of time that the Minister has been in the job, he ought to appreciate the absolute sapping of morale, particularly among teaching staff in these areas. It is absolutely right that London schools are a huge success story, but like the rest of the country, we have been through a lot of trauma, with the loss of Building Schools for the Future. Without going into the politics of it, there has also been the way in which academies and free schools have been introduced, and the imbalance of resourcing going to those schools rather than to community schools.

My hon. Friend the Member for Dulwich and West Norwood mentioned English as an additional language, special educational needs, deprivation and turnover. In particular, the effects of the Government’s housing policies mean that not only has there been this extraordinary churn, but families are regularly being thrown out of London and they then have to commute hours back with their children every day. Schools are seeing a huge turnover of pupils. Those things cannot be coped with easily. Schools need additional resources and we do not need this destabilisation.

I will continue doing the school gate meetings, even though the consultation has closed, because what has happened has awakened an appreciation of the overall attack on school budgets under this Government. It is unprecedented—it has not happened for at least 20 years or perhaps longer—so I echo what Members on both sides of the Chamber have said. Nobody wants the funding not to increase or the funding gaps not to be addressed in schools that may have been historically underfunded for a number of reasons. That is certainly not the fault of London education authorities, which have always—going back to the days of the Inner London Education Authority—prioritised funding for inner-city schools. However, the problem will not be addressed by substantially reducing the funding and resources of schools in London, which have done a fantastic job over the last 10 to 20 years in changing the mood and the climate. The Minister should wish to emulate that around the country, not drag London down.

[Mr David Hanson (in the Chair)]

I call Wes Streeting. I ask him to finish his speech by 10.35 am.

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[Mike Kane]

On a point of order, Mr Hanson.

[Mr David Hanson (in the Chair)]

I hope it is a point of order, Mr Kane.

[Mike Kane]

Mr Hanson, it should be noted that Members from all parties, including myself, were generous in giving way to the Minister. The Minister has not been generous in return.

[Mr David Hanson (in the Chair)]

I am afraid, Mr Kane, that that is not a point of order for the Chair. The Minister is entitled to give way or not give way according to his own preference.

[Mr Gibb]

Thank you, Mr Hanson; I want to respond to all the points that were made in the debate.

We launched the first stage of our consultation on reforming the schools and high needs funding systems in March last year. We set out the principles for reform and proposals for the overall design of the funding system. More than 6,000 people responded to that first stage of our consultation, with wide support for those proposals. I acknowledge the support that the hon. Member for Wythenshawe and Sale East (Mike Kane) has given to the principles of this formula.

We have just concluded a 14-week second stage consultation, covering the detailed proposals for the design of both the schools formula and the high needs formula. Our proposals will target money towards pupils who face the greatest barriers to a successful education. In particular, our proposals will boost the support for those from disadvantaged backgrounds, and for those who live in areas of deprivation but who are not eligible for free school meals—those ordinary working families who are too often overlooked. We are also putting more money towards supporting those pupils in both primary and secondary schools who have fallen behind in their education to ensure that they have the support they need to catch up.

Overall, 10,740 schools would gain funding under our proposals, and the formula will allow those schools to see those gains quickly, with increases of up to 3% per pupil in 2018-19 and of 2.5% in 2019-20. Seventy-two local authority areas will quickly see an increase in their high needs funding, and no local authority will see a fall in its funding.

As well as providing those increases, we have listened to those who highlighted in our first stage consultation the risks of major budget changes for schools. That is why we have proposed to include significant protections in both formulae. No school would face a reduction of more than 1.5% per year or of 3% overall per pupil and, as I have said, no local authority will lose funding for high needs. The proposals will limit the otherwise quite large reductions that some schools, including many in London, would see as the funding system is brought up to date.

The real-terms protection of the core schools budget underpins these proposals. As a result, we are able to allocate some £200 million to schools in both 2018-19 and 2019-20, over and above flat cash per pupil funding. That will combine significant protection for those facing reductions with more rapid increases for those set to gain under the fairer funding formula. High needs funding will see an equivalent real-terms protection.

London will remain the highest-funded part of the country under our proposals. Schools in inner London will attract 30% more funding per pupil than the national average, which is right. Despite the city’s increasing affluence, London schools still have the highest proportion of children from a deprived background and the highest labour market costs, as has been acknowledged in the debate.

We are using a broad definition of disadvantage to target additional funding to schools, comprising of pupil and area level deprivation data, prior attainment data and data on English as an additional language. No individual measure is enough on its own. Each factor reflects different aspects of the challenges that schools face, and they work in combination to target funding. Where a child qualifies for more than one of those factors, the school receives funding for each qualifying factor. For example, if a child comes from a more disadvantaged household and they live in an area of socioeconomic deprivation, their school will attract funding through the free school meals factor and the area-level deprivation factor—the income deprivation affecting children index.

The additional needs factors in the formula are proxies for the level of need in the school. We are not suggesting that the funding attracted by an individual pupil must all be spent on that pupil, but that schools with high numbers of pupils with additional needs are more likely to need additional resources. Using the proxy factors helps us target funding on schools that are more likely to face the most acute challenges. I will give way to the hon. Member for Dulwich and West Norwood (Helen Hayes), who introduced the debate, if she wants to come in on that point. If not, I will press on.