School Funding

Debate between Graham Stuart and Pat Glass

Thursday 5th November 2015 Westminster Hall

[Pat Glass]

Before the election, Labour also promised to introduce a review of school funding. We want to support the Government as they move forward with their review, but we are clear that funding has to be fair and just. It cannot simply be a recycling or shifting of existing resources within the system from those with greater needs to those with less great needs. One or two people said that children with the same levels of need must receive the same levels of funding. We support that in principle, but we want to see new money in the system.

The basic inequalities in the system go back a long way. My right hon. Friend the Member for Exeter was absolutely right when he said that its roots lie in the old standard spending assessment. I read the Hansard from the previous debate just before the election. The then shadow schools Minister, my hon. Friend the Member for Cardiff West (Kevin Brennan), said that the formula was known only to three people and

“one was dead, one had gone mad and the other one had forgotten”.—[Official Report, 10 March 2015; Vol. 594, c. 260.]

I am not sure where I fit into that, but there are advantages to being around the education system for a long time and having some degree of shared memory of all this.

[Graham Stuart]

Will the hon. Lady give way?

[Pat Glass]

I will just finish this point and then I will be happy to give way.

Historically, local authorities that prioritised education and spent above standard spending assessment—sometimes a great deal above SSA—were often metropolitan authorities that had their funding simply rolled forward into the schools block of the dedicated schools grant, and those authorities, often counties, that spent at or under—sometimes significantly under SSA—had their underspends rolled forward into the schools block of the SSA. Those are the roots of why we are where we are today.

[Graham Stuart]

I am grateful to the shadow Minister for giving way and I congratulate her again on her post. She said she would expect new funding to come into the system. Was she ruling out redistribution? It is politically difficult. The previous Labour Government did not want to go there: although many Labour areas would benefit, perhaps more would lose. I recognise the political difficulty, but surely similar children in similar schools in similar circumstances should get similar funding. If we accept the principle and accept that it is wrong now, we have to accept redistribution. Does she accept that principle and support those of us who, like the Minister, will have to take the difficult decisions?

[Pat Glass]

I will address that point as I make my argument.

It has been made clear today that however we came to be where we are, we all now agree that pupils with similar or the same needs throughout the country should not receive such different levels of funding. It is less clear how to resolve that, and it will not be easy to achieve. The Prime Minister has decided not to protect the entire education budget in real terms. The Institute for Fiscal Studies has highlighted that over the course of this Parliament per-pupil funding will fall for the first time since the mid-1990s, which will make it that much harder for the Government to deliver a genuinely fair funding system.

The Secretary of State told the House last week that the Government remain committed to implementing their manifesto pledge to make funding fairer. She told us that she will protect the schools budget, which she has promised will rise as pupil numbers increase. The IFS says that that is not going to happen, but we will give her the benefit of the doubt. She also highlighted the progress she has made in providing the additional £390 million this year for those areas with the lowest levels of funding, and said that that will continue next year.

But that is the rhetoric. As the hon. Members for Beverley and Holderness and for Shrewsbury and Atcham (Daniel Kawczynski) said, the reality in schools is very different. According to the latest National Union of Teachers survey, 60% of school representatives stated that teaching posts have been lost in their school; more than 60% stated that classroom support posts had been lost; and 55% stated that other support posts had been lost. Nearly 60% reported larger class sizes; more than 65% reported a reduction in spending on books and equipment; and nearly 45% stated that teachers were paying more for materials than they were previously. Of particular concern to the Members who mentioned it in their speeches will be the fact that 50% reported cuts in support to pupils with special educational needs. Respondents also noted a greater reliance on non-qualified teachers and teaching assistants.

Although we all agree with the principle that pupils with similar levels of need should receive broadly similar levels of funding, the Minister should reflect on some of the very real concerns that Members have raised today when he is considering the matter and ensure that any further changes are not only fair but just. Like the hon. Member for Gloucester (Richard Graham), I am interested to hear how it is going to happen, how it will be paid for, and what the time scales will be. I want to hear the what, the when and the how.

Schools are grateful for the additional £390 million allocation, but we must be clear that it is not new money and has come largely from a 25% cut in funding to the 18-plus pupil-funding stream and from the massive cuts we have seen to further education funding, with further massive cuts to come. Pupils who access FE or remain in school over the age of 18 are often pupils with SEN, vulnerable children, or children who simply learn more slowly and need an extra year or two to get to the level of their peers. They are the children closest to being NEET. It is neither fair nor just to take funding from that group of children to distribute across the rest of the sector, and it is not fair to take funding from other less well-off parts of the education sector. We particularly do not want to see another smash and grab on the FE sector.

I agree with fair and transparent funding in principle, but I repeat that new money is required. Funding must be fair to other parts of the system, especially those parts supporting children with SEN, looked-after children and other vulnerable children. It needs to be fair to the higher education sector, and particularly to the FE sector, given what has already happened. It must be fair to rural areas with small schools, which have been mentioned by a number of Members. My constituency is rural and has a school with just 12 children. The very existence of such small schools would be threatened by a system that makes no financial allowance for size. There will have to be transitional arrangements to ensure that no area or school loses out heavily.

I want to give the Minister the benefit of my experience, which I feel I will be giving him quite a lot in the months to come. I have a little time, so I will give him two examples. I remember being involved in a local authority where we wanted to change the funding system to make allowances for children from black and minority ethnic backgrounds. We made what we understood to be a small tweak to the system that resulted in a big change, with funding going to a school that was educating the children of the directors and senior managers of a Japanese car factory. They clearly did not need the money. The Minister should be aware that there can be unintended consequences.

More importantly, I do not know whether other Members remember, but in around 2005, schools started to scream that their local authorities were not handing over funding—that it was being top-sliced. The Blair Government at the time responded by naming and shaming local authorities, which then started to scream that it was unfair and was not happening. Someone had the bright idea that it was SEN funding: “SEN funding has gone up massively; that’s what’s causing this.” There was an investigation, and it turned out that an accountant in the Treasury had tweaked a tiny bit of the formula here, which had a massive impact over there. Whatever happens, the Minister must be clear that the changes are properly consulted on; that we know exactly who will be the winners and losers, and by how much; that they are piloted; and that there are transitional arrangements over a period of time.

The Chancellor and the Minister are in real difficulty. Perhaps Government Members did not see, but the Secretary of State’s face was a picture when the Prime Minister promised to continue the infant free school meals programme at PMQs last week. We hear a lot every week about the promise of 30 hours of free childcare, but that is already under-funded by £l billion. I have sympathy for the Minister, because I have been in his position, albeit to a lesser extent. I have been the person who has had to deliver good and outstanding services, but who had to balance the budget amid all the cries for additional money.

I ask every Member present who has called for fairer funding for schools to remember where the last tranche of funding came from—a smash and grab on FE. Every one of us has an FE college in our constituency. We know that they have been hit massively already and are facing a further 24% cut in funding. Our colleges have been more than decimated by cuts, and we do not want to see more. All Members present will want to see a new funding system that is fair and just to all children and all sectors. With that, I am happy to sit down and let the Minister try to square the financial circle.