School Funding Formula

David Laws Excerpts

Tuesday 10th March 2015 Commons Chamber

[The Minister for Schools (Mr David Laws)]

We have had a short but on the whole excellent debate. I congratulate my hon. Friend the Member for Worcester (Mr Walker) on his leadership of the campaign, on opening the debate, and on putting the case so powerfully and in a way that sought to unite Members across the House. I also pay tribute to the other hon. Members who spoke, who in most cases have been involved in the campaign for quite some time, including the hon. Member for Scunthorpe (Nic Dakin), my hon. Friend the Member for Beverley and Holderness (Mr Stuart), the Chair of the Education Committee, my right hon. Friend the Member for Meriden (Mrs Spelman), and my hon. Friends the Members for The Cotswolds (Geoffrey Clifton-Brown), for North Devon (Sir Nick Harvey), for South Dorset (Richard Drax), for Hexham (Guy Opperman), for Newton Abbot (Anne Marie Morris), for Norwich South (Simon Wright) and, of course, my hon. Friend the Member for Cambridge (Dr Huppert), who has done such a fantastic job in representing his constituents’ interests on this issue of revenue funding in the same way as he has done on capital funding. As he noted, as a consequence of those representations, parts of the country, such as Cambridgeshire, which were underfunded for many years under the last Government, have at last seen a massive move towards fair funding.

I do not want to make a partisan speech, particularly after the good example set by my hon. Friend the Member for Worcester, but I was a little disappointed by the shadow Minister’s response. He might at least have started with an apology for doing nothing in 13 years to correct the problems in the funding formula. I thought that we might have had a clear plan from the Labour party, given that he had so much to criticise about the coalition’s policy, on how he would introduce a national fair funding formula. What I heard was something of a policy free zone of a speech. Perhaps the lack of support behind him on the Labour Benches indicates the lack of enthusiasm among members of his party to sort out the injustices that have dogged our funding system for so long.

When this Government came to power in 2010, the funding system for schools that we inherited at the start of the Parliament was opaque, irrational and unnecessarily complex at both national and local levels. Similar pupils were funded at vastly different levels simply because they happened to be in different local authorities or in different types of school building. Previous Governments knew that the school funding system was unfair but failed to reform it.

[Mr Redwood]

Would the Minister suggest that there should be a limit on how big the gap can be between the best and the worst per pupil level of funding, as that would be a starting point for getting some justice?

[Mr Laws]

That is certainly a sensible principle, and it is exactly what we have tried to do through many of our reforms.

Throughout the Parliament we have introduced major reforms that have improved the fairness and simplicity of the system and laid the essential foundation stones to allow us, the two coalition parties, to introduce a full national funding formula in future. The major reforms we have made are changes to the local funding system, and changes to the way in which we fund disadvantage, with the introduction of the pupil premium and minimum funding levels. Time does not allow me to speak in detail about the first two changes, but I would like briefly to say something about the third—minimum funding levels.

We introduced minimum funding levels last year. I thank not only all the Members who lobbied for that change in the system but the excellent officials in our Department who worked hard, over a sustained period, on the new model. This Government have introduced the first reforms to the distribution of funding between local areas in over a decade. In 2015-16, every local area will attract a minimum level of funding for each of its pupils and schools. The £390 million increase in funding that we introduced as part of minimum funding levels represents a huge step towards removing the historical unfairness of the schools funding system. It ensures an immediate boost to the least fairly funded authorities and puts us in a much better position to implement a national funding formula in the next Parliament. All the logic of the reforms we have made indicates that they should be baselined into funding in the next Parliament. I can certainly make that commitment on behalf of my party; it is for others to make commitments on behalf of their parties.

[Mr Graham Stuart]

Will the Minister give way on that point?

[Mr Laws]

I will not, I am afraid, because of the lack of time.

In the next Parliament, multi-year spending plans will allow us to give certainty to local authorities and schools about how we transition to a national funding formula. Meanwhile, no local authority or school will lose out from the introduction of minimum funding levels from 2015-16, but about four in 10 areas will gain. We have already heard from my hon. Friend the Member for Worcester, whose area gains some £100 per pupil—an increase of just over 2%—as a result of the changes for which he lobbied. My hon. Friend the Member for North Devon has been a great campaigner on this issue for many years and has helped to secure an uplift of about 5% in his part of the country. My hon. Friend the Member for Cambridge has helped to secure a huge increase of about 8% for funding in his part of England—an additional £311 per pupil that will make a massive difference to schools. This is only one step in the transition to fairer funding and a national funding formula, but it is the biggest step towards fairer schools funding in a decade.

The three major reforms over this Parliament do not, of course, complete the reform of school funding. We recognise that we still need to introduce a full formula to ensure that pupils with similar characteristics attract the same level of funding regardless of where they live. Nevertheless, I am proud that the changes we have made have delivered the big improvements that we have seen. They put us in a much better position than we were in at the beginning of this Parliament. We now have to do the important preparatory work that will be necessary to put in place a national fair funding formula in the next Parliament. We also need to review funding on deprivation to make sure that it is fair across the whole country, and that we can build on the enormous improvements made in this Parliament and the massive contribution that the pupil premium has made.

We are now in a position to finish the job of introducing, for the first time in decades, a fair funding system for schools in this country. Once we have long-term spending plans, we will be in a position to introduce, in a stable and sensible way, the full national funding system for schools for which Members have argued. Both governing parties in this House—both coalition parties—have put on the record very clearly their commitment to a national fair funding formula. Those of our constituents who care about this issue can best ensure the delivery of this policy through the choices they make—