School Funding

Gareth Thomas Excerpts

Wednesday 24th October 2018 Westminster Hall

[Gareth Thomas (Harrow West) (Lab/Co-op)]

It is a pleasure to follow the hon. Member for St Albans (Mrs Main), who I congratulate on securing the debate. For the first 19 minutes of her speech she sounded as if she was reading a Labour party brief, and I was about to get out a membership form to pass across to her. It was just the last two minutes that spoiled it slightly, and I am afraid as a result I cannot pass the form across after all. I certainly recognise her analysis of some of the problems that affect our schools’ finances.

I am the only London Member present, so if Members will forgive me, I shall dwell predominantly, parochially, on my own borough and mention at least one issue that affects London schools in particular. The one thing missing from the analysis given by the hon. Member for St Albans—if I may gently chide her—was consideration of the impact of cuts in general local authority funding. As a result of those cuts, most of the support that used to be available from local authorities to help schools in difficult circumstances is no longer there. Schools have had to find their own solutions—some with considerable success and others with less. That is part of the backdrop that we need to consider.

I am privileged to represent schools that, according to independent analysis by the Education Policy Institute, are in the borough that provides the best education in the country—from starting school to leaving school. The increase in achievement is, apparently, best in Harrow, according to the institute. I give particular credit to the teachers, parents and leadership of my borough’s schools, and as a former teacher I recognise the huge contribution to the country that teachers and other professionals in schools make. I want to highlight the pressures that schools in my constituency face. I should acknowledge the generous offer of the Minister for School Standards, who is responding to the debate, to receive a delegation of headteachers from Harrow. We are in the process of organising that. I hope to persuade him not only to meet the delegation but to come to Harrow to see one or two schools in my constituency that face particularly challenging circumstances.

The average annual cost implication of the financial pressures on schools in my constituency—for the current 12 months, compared with the previous 12 months—is more than £203,000 for a secondary school and more than £70,000 of additional net costs for a primary school. That comes from the increase in non-teaching pay awards, non-teaching pensions, the apprenticeship levy, the estimated likely increase in teaching pay awards and other aspects of the incremental costs that come with teachers’ pay rises. It does not include any increase in the cost of pensions. There are pay pressures as the result of rises in utility costs and there is reduced income, in particular for primary schools, which are experiencing annual reductions, related to pupils in receipt of pupil premium grant, of on average £10,000. I have described average pressures, with an assumption that average school budgets are cash flat, but in Harrow some 25% of schools that are currently protected by the minimum funding guarantee expect to lose roughly 1.5% of their pupil budget per annum, as a result of the way that the minimum funding guarantee works. That could equate to a cash reduction of a further £20,000 to £30,000 per annum.

For a primary school, losing £70,000 a year equates on average to the cost of one to two teachers. For a secondary school, an average loss of £200,000 is the equivalent of four teachers. As the hon. Lady said, school headteachers and governors are trying to find ways to protect the experienced teachers who add the most value to a child’s education, but experienced teachers who go are often replaced by a newly qualified teacher. Many of those are, as the hon. Lady said she once was, bright young things. They are enthusiastic and skilled and have a huge contribution to make, but they do not have the same experience, and that is a significant problem. Alternatively, teaching assistants can be lost, as is happening in my constituency. That has a particular impact on those with special educational needs, and there is a knock-on effect on other young people in those classes.

The hon. Lady rightly dwelt on the funding crisis for special educational needs. There has been some helpful media coverage of that, of late. I understand that roughly half of London boroughs face significant shortfalls in funding. They are overspending on SEN budgets, such has been the growth in the pressures. That is partly caused by some helpful changes in connection with the conclusion of the SEN funding review, leading to an increase in the number of post-16 and post-19 SEN children deemed eligible for funding, as well as general demographic growth and the fact that the formula for SEN is currently based on historical data on children aged five to 15, and does not reflect the post-19 inclusion.

Another particularly helpful aspect of the hon. Lady’s speech was the reference to sixth form provision. There has been an 8% real-terms cut for every school, as concluded by the Institute for Fiscal Studies, but the 21% cut affecting sixth forms is a particular pressure for St Dominic’s Sixth Form College in my constituency. While I hope that there will be a general funding increase for education, I hope that Ministers will look particularly at sixth forms in that respect.

Lastly, I ask the Minister to come to Grange Farm or Norbury Primary Schools in my constituency. Their headteachers are remarkable individuals who are hugely passionate and determined to do what they can for their children. Nevertheless, given the housing crisis in London, the number of pupils who move on a regular basis, and the scale of the diversity challenge, financial pressures are adding to the general problems facing those schools, and I would be keen to host the Minister on a visit to Harrow to improve his education on the school funding crisis.

--- Later in debate ---

[Nick Gibb]

We have made a significant investment in our schools by providing an additional £1.3 billion across this year and next, which is over and above the funding confirmed in the 2015 spending review. The additional money means that core funding for schools and high needs will rise from almost £41 billion in 2017-18 to £42.4 billion this year, and to £43.5 billion in 2019-20. As the independent Institute for Fiscal Studies has confirmed, funding for five to 16-year-olds will be maintained in real terms per pupil across this year and next year. The IFS has 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.

Of course we recognise that we are asking schools to do more and that schools are facing cost pressures. That is why the Department is providing extensive support to schools to reduce cost pressures. We have recently launched “Supporting excellent school resource management”, a document that provides schools with practical advice on savings that can be made on the £10 billion of non-staffing expenditure in schools. It summarises the support the Department is offering to help schools to get the best value from their resources, including things such as buying equipment more cheaply and the new teacher supply agency framework, which ensures that fees paid by schools to agencies are transparent and that people are aware of what they are signing up to.

Another issue that was raised was, of course, high needs. We are firmly committed to supporting children with special educational needs and disabilities to reach their full potential. That is why we have reformed the funding for these children by introducing a high-needs national funding formula. We have invested an extra £1 billion in funding for children with high needs since 2013 and next year we will provide local authorities in England with over £6 billion in high needs funding, which is up from just under £5 billion in 2013. We recognise the challenges that local authorities face with their high needs budgets, which is why we have provided them with support to deliver the best value from their high needs funding. We are also monitoring our national funding formula for high needs and keeping the overall level of funding under review.

The issue of teachers’ pay and pensions was also raised. We have responded to the recommendation made by the school teachers’ review body to confirm the 2018 pay award for teachers, which will see a substantial 3.5% uplift for the main pay range, a 2% uplift for the upper pay range and a 1.5% uplift for the leadership pay range. That will ensure that schools are supported to continue to attract high-quality staff members and retain them.

[Gareth Thomas]

Will the Minister give way?

[Nick Gibb]

I will not give way, because of time.

We are funding the teachers’ pay award above the 1% that schools will already have budgeted for, by providing a teachers’ pay grant worth £187 million in 2018-19 and £321 million in 2019-20. This funding will be over and above the funding that schools receive through the national funding formula.

I want to give time to my hon. Friend the Member for St Albans to respond briefly to the debate, so I will conclude by thanking all Members who have contributed to this important debate. It is a key priority for this Government to ensure that every child receives a world-class education, to enable them to reach their full potential. I believe that the significant extra investment that we are making in our schools—both revenue and capital, and distributed more fairly through the national funding formula—will help us to achieve that.