National Funding Formula: Social Mobility

Emma Lewell-Buck Excerpts

Tuesday 22nd May 2018 Westminster Hall

[Mrs Emma Lewell-Buck (South Shields) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Walker.

I thank the hon. Member for Bath (Wera Hobhouse) for securing the debate and for her eloquent and detailed speech outlining the key issues facing our schools and the negative impact that some of the Government’s decisions are having on our children. I also thank the hon. Members for Eastbourne (Stephen Lloyd) and for Horsham (Jeremy Quin) for their contributions, and other Members for their interventions.

It is safe to say that there is a consensus in the Chamber: we all agree that our system of school funding should be designed to improve social mobility. Sadly, that is probably where the agreement ends, because everything the Government do flies in the face of improving social mobility—from their inaction on low pay and insecure work to their punitive welfare reform measures, which led the Joseph Rowntree Foundation to conclude that almost 400,000 more children have been plunged into poverty in the past four years and that the number of children in poverty is due to soar over the next few years to a record 5.2 million. The new schools funding system is no different: it will not achieve social mobility.

Children should never be denied the same opportunities in life just because of the place they were born. Yet in the north, two to three-year-olds are less likely than their London counterparts to reach the expected standard of development when starting school, and the National Education Union has said schools in my part of the world—the north-east—face the biggest cuts, with one school due to lose nearly £8,000 per pupil. Success in life should not be the result of a postcode lottery, but under this Government it is.

I think I can pre-empt what the Minister will say. He will tell us that there is funding for children in disadvantaged areas, for children with low prior attainment and for children eligible for free school meals. That is correct, and it is welcome, but it is simply not good enough. It is not good enough, because it ignores the wider issues facing schools in terms of the implementation of the funding formula and the impact of the first cuts to school budgets in a generation.

[Wera Hobhouse]

Does the hon. Lady agree that headteachers are not just making that up? For example, a headteacher in a deprived area in my constituency is not laying off support staff because he enjoys doing that; he is laying off support staff and those who help vulnerable children because he does not have the money.

[Mrs Lewell-Buck]

I agree. I have had representations from headteachers, staff and support assistants in my constituency as well. That problem faces schools throughout our country—they are put in an intolerable position because their funding has been cut and cut.

The Education Secretary and the Chancellor of the Exchequer have both said that every school in the country will receive a cash-terms increase to their funding. We know, however, that that is simply not the case, as do the independent Institute for Fiscal Studies and the UK Statistics Authority, which has repeatedly told the Government that that claim is not accurate. Perhaps the Minister will get it right this time. I am sure that by now his Department has received the local funding formula for every local authority in the country. Can he tell us how many schools will face a real-terms cut to their budgets, and is he able to tell us where those schools are?

The Minister has told us of the local authorities that have written to his Department to seek permission to top-slice their budgets to fund additional high-needs support. How many schools across the country will see their block funding cut as a result of those decisions? Such cuts should not be necessary. Schools and councils should never be forced to choose between funding the day-to-day expenses of their schools and getting the high-needs funding that is vital to so many of their pupils’ needs.

[Layla Moran]

I am grateful to the hon. Lady for giving way and for raising the issue of special educational needs provision. The education, health and care plan system is not working in places such as Oxfordshire because the county does not have the resources to deliver it. Although the schools are able to come up with the plans, they and the county do not have the money. Is this a picture that she has seen, because it is inundating my inbox?

[Mrs Lewell-Buck]

I thank the hon. Lady for that intervention. A recent local ombudsman report said that the picture of ECHP plans across the country is dire, and local authorities are often spending more money on tribunals to rectify decisions they made in the face of cuts, rather than actually implementing the plans in the way they should be implemented in the first place.

The fact is that school budgets have been slashed for the first time in a generation. The National Audit Office found that, since 2015, £2.7 billion has been lost from school budgets in real terms. If the Government were not making cuts to school budgets, it would be possible to introduce a new funding formula in a way that was equitable and sustainable and that could actually improve social mobility, but the Government are failing to do that. When the revised funding formula was put forward after the snap general election, one of the major changes was the introduction of a minimum funding level per pupil in secondary schools. Given the way that the formula allocates funding and the extent to which it allocates more funding to disadvantaged pupils, a minimum funding level would be particularly helpful to schools that take a very small number of pupils from disadvantaged backgrounds—in other words, grammar schools.

When the £4,600 minimum per secondary school pupil was announced, the Government committed an extra £1.3 billion to schools over two years. How much of that additional funding will find its way to grammar schools? It seems to us in the Labour party that finding extra funding to go to grammar schools—most of them in areas represented by the Minister’s colleagues on the Conservative Back Benches—is not a policy that will increase social mobility. In fact, it will do the opposite and focus resources more and more on the pupils who need it least, while those who need the additional support and additional funding will simply not have access to it.

We do not object to the principle of a minimum level of funding per pupil. However, it is worth remembering how the Conservative party arrived at that policy. When the funding formula was first devised, the Government did not believe that there should be a minimum funding level. Only after their Back Benchers—particularly those representing schools with more affluent intakes—raised concerns that they did not see enough extra funding in the formula did the Minister come to believe in the policy.

Although we welcome the belief in the minimum amount to which every single pupil should be entitled, I wish the Government would do this properly. Instead of finding a fraction of the funding that our schools need by making cuts elsewhere in an effort to buy off their own Back Benchers, why did the Minister not push to end the cuts to school budgets and increase per pupil funding in real terms for every single child, not just a minority of children?

Despite there being some elements of the funding formula that we welcome, the funding that goes to the most disadvantaged pupils is being cut in real terms year after year. Despite the rhetoric from the Government, the pupil premium has been falling in real terms every year since 2015. They have failed to increase the funding in line with inflation, which has led to the funding falling in real terms. In fact, it has fallen by £140 million.

A recent article in the press noted:

“A Department for Education source confirmed that in real terms the amount per pupil spent on the pupil premium specifically has fallen.”

Will the Minister confirm today that the per pupil spending on the pupil premium has fallen in real terms? Will he also tell us why, in reducing the funding formula, the Government have not ensured that that vital funding is protected?

[Wera Hobhouse]

The hon. Lady is very generous for allowing me to intervene again. Does she agree that the pupil premium introduced by the coalition Government was a powerful thing because it followed every single pupil around? The fact that funding per pupil is now being cut is a tragedy and is counter to what was radically introduced during the coalition Government.

[Mrs Lewell-Buck]

I thank the hon. Lady for that intervention. It will come as no surprise to her that I am a big advocate of the pupil premium and pupil premium plus.

Does the Minister really believe that the funding formula can truly support social mobility when it has not included meaningful protection of funding for the most disadvantaged students in our schools? He might say that the funding formula does not distribute pupil premium funding, but it would be disingenuous to act as though the two issues could be meaningfully separated. The issue of school funding and how it is allocated includes the pupil premium, whether the Minister considers them to be the same issue or not.

I sincerely hope that, in answering our questions and after listening to today’s debate, the Minister will show some appreciation of the fact that it is simply not possible to really improve social mobility when the Government have cut school budgets for the first time in a generation and are slashing the funding that goes to the most disadvantaged pupils year after year. Frankly, Minister, our children deserve better.

--- Later in debate ---

[Nick Gibb]

The hon. Lady will know that the School Teachers Review Body, the independent pay body that makes recommendations about teachers’ pay, has reported to the Department, and we are looking at that report. We will respond to it, and I hope that that will be before the summer recess; that is our intention.

[Mrs Lewell-Buck]

I have been following the Minister’s remarks on overall funding. Does he seriously think that what the Government are now implementing makes up for the £2.7 billion lost since 2015 in the first cuts to school budgets in a generation and for all the neglect since 2010?

[Nick Gibb]

I remind the hon. Lady that last year schools funding was £41 billion. This year—2018-19—it is £42.4 billion, and in 2019-20 it will be £43.5 billion. As the independent Institute for Fiscal Studies has confirmed, that will allow us to maintain school and high-needs funding in real terms per pupil for the next two years. The IFS also pointed out that by 2020 real-terms per pupil funding will be some 70% higher than it was in 1990 and 50% higher than it was in 2000.

The hon. Member for Oxford West and Abingdon (Layla Moran) acknowledged the extra £1.3 billion brought in, which we were able to identify last summer. We have been able to ensure that all schools, and all areas, will attract some additional funding over the next two years and have provided for up to 6% gains per pupil for underfunded schools by 2019-20. We have therefore, Mr Walker, gone further than our manifesto pledge—and I should have mentioned at the outset what a pleasure it is to serve under your chairmanship; I was keen to get stuck into the debate. Now every school in every area will, under the national funding formula, receive at least 0.5% more per pupil this year than it received in 2017-18 and 1% more in 2019-20. The significant extra investment in schools demonstrates our commitment to ensuring that every child, regardless of their background, receives an excellent education.

During consultation on the formula, we heard that we could do more to support the schools that attract the lowest per pupil funding, something that the hon. Member for South Shields (Mrs Lewell-Buck) mentioned in her remarks. We listened to those concerns—something that I am criticised for, but I thought it was important to do so—and our formula will rightly direct significant increases towards those schools. In 2019-20, the formula will provide a minimum per pupil funding of £4,800 in respect of every secondary school and £3,500 in respect of every primary. That ensures that every school will attract a minimum level of funding through the formula, no matter what its pupil characteristics are. In addition, those schools will be able to attract even larger increases, as we have not limited their year-on-year gains to the 3%. Some of the lowest-funded schools in the country will therefore attract gains of more than 10% per pupil by 2019-20—something that I now understand the Labour party opposes. It therefore opposes, for example, the increase under the national funding formula of 10.1%—some £145,000—for Newbridge Primary School in the constituency of the hon. Member for Bath. That minimum funding also applies to St Stephen’s Church School, which, under this system, will receive a funding increase of 17.5%, or £214,000. Beechen Cliff School will receive a 10.9% increase in funding, equal to £427,000, once the national funding formula is fully implemented.

[Mrs Lewell-Buck]

Will the Minister give way?

[Nick Gibb]

I will give way once I have finished this list, which I have to say is rather long. Hayesfield Girls’ School in the constituency of the hon. Member for Bath will receive an 8% increase, equal to £335,000, once the national funding formula is fully implemented, and Oldfield Secondary School will receive a 9.4% increase of £414,000. Saint Gregory’s Catholic College will receive an 8.2% increase once the funding formula is fully implemented, equal to £293,000.

With the national funding formula, we have been able to allocate funding to schools that historically have been underfunded. We listened carefully to the f40 campaign, of which my hon. Friend the Member for Horsham was part, and we want to deal with the historical unfairness of schools that have been underfunded year after year. We are addressing that, and the examples I have given show that we have a national funding formula from which schools in the constituency of the hon. Member for Bath are benefiting. Bath is getting one of the biggest increases of any local authority in the country, and I had hoped that she would come to this debate to congratulate the Government on taking a brave stance in implementing that funding formula.

[Wera Hobhouse]

rose—

[Mrs Lewell-Buck]

rose—

[Nick Gibb]

I will give way to the hon. Member for Bath since I mentioned her, and then to the shadow Minister.

[Nick Gibb]

But those schools are funded at significantly above the national average for schools, and if we are moving towards a national funding formula, that will be the consequence. We addressed that in our 2017 manifesto when we said that no school would have a cut in funding to get to the national funding formula position, but we changed that when we came back after 2017 and secured extra funding of £1.3 billion. That enabled us to introduce this minimum funding from which many schools in the hon. Lady’s constituency have benefited and to ensure that no school will have a cut in funding, since the worst that can happen is a 0.5% increase in each of those two years.

[Mrs Lewell-Buck]

The Minister is talking about fairness and equity in the system, but what does he say to a school in the north-east that, according to the National Education Union, is set to lose £8,000 per pupil? How is that fair?

[Nick Gibb]

What the NEU is doing with its school cuts campaign is misleading. It is taking the cost pressures that we have acknowledged and telling the public that those are funding cuts. I have been clear that no school has had a funding cut. School funding went up in real terms per pupil in the last Parliament, and that increase has been maintained in real terms.[Official Report, 19 Jun 2018, Vol. 643, c. 1MC.] The NEU is talking about cost pressures that have had to be absorbed, not just by the school system but by other parts of the public sector and the private sector. The hon. Lady will know that once the national funding formula is fully implemented, funding in South Tyneside will increase by 4.5%, which is equal to £3.9 million more going into schools in that area.

--- Later in debate ---

[Mrs Lewell-Buck]

I was not going to intervene again, but the Minister mentioned my area, and I will not take any lessons from him about what is happening to schools on my patch. Teachers come to see me on a regular basis saying that they are at breaking point because the cuts are damaging their ability to continue. Some schools are saying that they will have to go down to teaching just four days a week. I am sorry, but the Minister is wrong when he talks about how great things are for school funding in south Tyneside .

[Nick Gibb]

I am saying that thanks to the £1.3 billion extra funding that we secured, schools in south Tyneside will receive an extra 4.5% once the funding formula is fully implemented, which is equal to £3.9 million. [Interruption.] I have acknowledged that over the last three years, up to 2017-18, there have been cost pressures. Higher employer national insurance contributions have had to be absorbed not just in the school sector but across the public and private sectors, and there have been higher teachers’ pensions contributions, which was the right thing to do.