West Sussex Schools Funding

Jeremy Quin Excerpts

Wednesday 2nd November 2016 Westminster Hall

[Sir Nicholas Soames]

I am grateful to have the opportunity, with my West Sussex colleagues, with whom I have been working for a considerable period of time on this matter, to draw the House’s attention on this occasion, which certainly is not the first, to the question of fair funding for West Sussex schools. I am fortified by the presence and support of my hon. Friends and parliamentary colleagues for West Sussex, who have been campaigning on this matter for a long time now. We have campaigned together and are wholly in agreement. Those of my hon. Friends who are able to be here will speak to explain the case further to my hon. Friend the Under-Secretary. I welcome her to her place and am delighted that she will answer on behalf of the Government. May I say to her at the beginning that the very rude things I will say about her Department are absolutely in no way aimed at her at all? I regard her, as we all do, as an exemplary and remarkable Minister—none of this happened on her watch.

For the 32 years I have been a Member of Parliament—I am an amateur compared with my hon. Friend the Member for Worthing West (Sir Peter Bottomley), who has been here much longer than me; he is not the Father of the House but practically the grandfather of the House—the treatment of West Sussex in local government finance terms has been unfair and indeed wholly unsatisfactory. The issue of today’s debate is really the catharsis of 30 years of financial bad treatment for West Sussex. In respect of education, it is now a question of fairness.

The position is surgically plain. West Sussex has per pupil funding of £4,198, which is £438 per pupil below the national average and makes schools and academies in West Sussex the fifth worst-funded nationally. That is not acceptable to the West Sussex Members, it is not acceptable to our county council, and much more importantly it is increasingly unacceptable and causes great anxiety to parents, pupils, headteachers and staff. We look to the Department for Education to fix it.

The current situation puts us below our neighbours in East Sussex and Surrey, and well below the very well funded urban authorities of the city of London, which comes right at the top of the pile with double the funding of West Sussex. Our position in West Sussex is therefore very bad. There is no other way of describing it, not least since we all agree that every child deserves the same chance in life when it comes to state-funded education. Frankly, they are not getting it. The figures graphically show that, in West Sussex, it is emphatically not the case. It is not even as if the results are anywhere near as good as they should be. Indeed, they are disappointing and must improve. Resources are a part but only a part of that equation.

The West Sussex Members of Parliament met Ministers in September last year and again in February this year to press the case. We met the Minister for School Standards 10 days ago for a useful meeting, and we are to meet the Secretary of State this very afternoon. The aim is to try to find a sensible way forward to resolve a crucial and unacceptable situation, and to try to understand the thinking of the Department for Education. It has big reforms to come and will look for our support. We need to fix the grassroots basis of the funding of local education before we move on to some of those more exotic, and indeed welcome reforms. They will require our support, but without this situation being fixed, it is difficult to see how that can occur.

[Jeremy Quin (Horsham) (Con)]

It is not only a question of long-term funding. As Conservatives, we were all elected on a manifesto commitment to fix fair funding for the future. I am sure my right hon. Friend agrees that there is a lot of concern about the immediate funding for schools and a requirement for transitional funding. I wonder whether he will come to that in his remarks.

[Sir Nicholas Soames]

I am grateful to my hon. Friend. I pay tribute to him for the work he has done in leading our group, and for the enormous amount of work he has done on behalf of headteachers and schools, not only in his constituency but elsewhere. He is quite right, and I hope that by the end of this inadequate speech, he will feel that I have dealt with some of those problems. It is not just the future but the now. We need to resolve the position between the now and the future—we all welcome strongly the introduction of the new funding formula.

All the West Sussex Members—I am sure those who speak will make this point—are entirely satisfied that my right hon. Friend the Secretary of State for Education, the Minister for School Standards, the Under-Secretary who is here today and their officials accept that West Sussex schools are underfunded compared with the national average. As I said, the figures are there in stark reality. What we really need is for them to act now and restore some balance to a situation that is out of kilter.

As I say, we warmly commend the Government for bringing forward the new plan for the national funding formula, which will be introduced from 2018, and the release of a very small sum of additional money already given by the Department surplus. The Minister knows that West Sussex Members of Parliament, supported by headteachers and parents in all our constituencies, have lobbied vigorously for urgent consideration to be given to the adequate provision of transitional funding to help tide over hard-pressed local schools until the new formula can be introduced. West Sussex schools can thus get on an equal footing with those in other counties, which is surely only right and fair.

On 14 September, my right hon. Friend the Secretary of State, when giving evidence to the Select Committee on Education on her roles and responsibilities, confirmed that her Department was approaching this matter in a sensible and rational way and that it was

“going to provide interim support.”

That was in her answer to Q221 in evidence to the Select Committee. It is that question on which we will press her this very afternoon, so that we can get to a better school funding system in an orderly and sane manner, based in future on pupil numbers, and less on some extraordinary and archaic formula based on past political considerations, which will recognise that West Sussex has been losing out for years.

As I have said, the present situation is both unacceptable and wrong, and we insist on its being put right. It is not correct or fair that a typical secondary school in the Mid Sussex or Horsham constituencies, for example, will receive more than 15% less than the national median funding for schools.

When on 7 March my right hon. Friend the Member for Loughborough (Nicky Morgan), the then excellent Secretary of State for Education, announced in a written statement a consultation on national funding formulae for schools and high needs, she made the point that the transition to the new system should be manageable. It is that question that we look to the Minister of State, the Secretary of State and my hon. Friend the Under-Secretary to help us resolve this morning. It is the collective judgment of all the West Sussex Members of Parliament, who have worked closely together and have gone carefully into the matter, that present levels of funding will, without transitional funding, inevitably have a damaging effect on local schools and children’s learning. Each of us must speak for our own constituency—my hon. Friends will do so—but in Mid Sussex, as things stand, good schools are placed in the intolerable position of having to preside over further real cuts to school budgets that are frankly no longer sustainable.

The Government have rightly urged schools to achieve efficiencies, but those have already been adopted by the schools in my constituency and elsewhere, not least to meet the new costs arising from, among other things, increases to teachers’ pension and national insurance contributions for 2016-17. Having listened to the concerns of parents, councillors, headteachers and teachers, and having consulted more widely, we all agree that school budgets are already squeezed to the limit. It is, I am afraid, understandable that headteachers are considering a number of dramatic measures, some of which I wholly disapprove of, to make ends meet. We therefore ask the Under-Secretary, and will ask the Secretary of State this afternoon, to allocate transitional funding to support our schools to meet those serious cost pressures until the national funding formula is introduced.

A powerful letter sent to my right hon. Friend the Prime Minister by a number of West Sussex headteachers, with the support of a number of my parliamentary colleagues, sets out a request for £20 million of transitional funding. That would represent an increase of approximately £200 per pupil across West Sussex. That sum of money would put our schools back on a more or less even keel against the arrival of the national funding formula.

I want to mention the special concerns of special needs schools in my constituency and West Sussex more generally. They find it very hard going to deliver the education service that I know the Under-Secretary and her ministerial colleagues would insist be delivered to children who have considerable difficulties. They are trying very hard, but in some cases they will simply no longer be able to do it. The situation in West Sussex special needs schools is very serious. Woodlands Meed school in my constituency is a remarkable school, but is in an untenable position. Not only has the county council treated it extraordinarily badly and, in my view, dishonourably, over the question of new building to consolidate schools into one, but its financial situation is extremely serious. It is impossible for the children at the school to be educated properly without the necessary support staff. I make a plea today for children with special needs in West Sussex; they are not getting a fair crack of the whip.

My hon. Friends and I, and the county council, are well aware of the restraint required in public expenditure. However, we believe that the situation in our county is very serious. We all earnestly entreat the Under-Secretary and her ministerial colleagues to consider favourably the coherent, sensible and reasonable requests that we make on behalf of our constituents.

[Jeremy Quin (Horsham) (Con)]

I congratulate my right hon. Friend the Member for Mid Sussex (Sir Nicholas Soames) on securing the debate and on his excellent framing of the argument.

As we look to our newly defined national future, the challenge of improving our national productivity is real and acute. Only through increased productivity will we deliver the public services and increases in the standard of living that every generation expects. Education and skills are among the most important drivers of that vital transformation in our national productivity. We need to continue the already positive improvement in science, technology, engineering and maths, and to my mind our trading future requires better results in foreign languages. Investment in education, properly targeted, is money well spent.

This is an important issue for the whole country, but the challenge is especially important for those of us who represent West Sussex, which is the worst funded of any county authority with funding of £4,198 per pupil. Under the current funding formula, the county receives £44 million less than the national average and some £200 million less than some London boroughs. I and my colleagues were pleased to stand on a manifesto that pledged a change in the funding structure of our schools, and I am delighted that the Government, having secured an overall majority, are pressing forward with far-reaching and long overdue reform. I await with interest the Government’s response to the first consultation.

A wide range of factors was proposed for possible inclusion in the funding formula. I am sure the new formula will be better than the current system, which my right hon. Friend the Secretary of State described as arbitrary, unfair and out of date, but while the Government’s aim of maintaining higher funding for schools with issues of deprivation is laudable, I hope they will recognise the need for all school places to have satisfactory and effective funding. I am sure they will.

There are pockets of deprivation in every town and rural area. Every school has problems to confront, and ensuring proper recognition of the basic costs of providing the teaching staff and delivering the curriculum will be key. That is especially difficult in areas within commuting distance—subject to Southern rail and the National Union of Rail, Maritime and Transport Workers—of London. The cost of living in my constituency is very high, which makes it harder to recruit and retain the excellent teaching staff that children and parents rightly expect. That is especially true and worrisome in an area in which school infrastructure rarely seems to keep pace with population growth, adding to the strain placed on headteachers and staff. There is a worrying impact on class size, as at Tanbridge House school or Forest school in my constituency—at Forest secondary school, top set classes in core subjects already have 35 or 36 pupils. That obviously has a direct impact on teachers, but it also has practical consequences in classrooms designed for 30 pupils with a number of PCs to match. Schools that provide targeted support for struggling pupils used to do it in sets of 12 or 15, but now find that those sets have grown to 20, which means less effective lessons in which it is harder to focus.

Fair funding—redressing the balance—is critical. I look forward to the second consultation and what I trust will be an appropriate recognition of the high basic cost of education of every child. We are very proud of the good results generated by the schools in my constituency, but no one, least of all the Minister, would take that as a source of complacency. Excellent teaching, committed leadership and supportive parents all still need a solid underpinning of funding. In the immediate term, that foundation of solid funding is a source of real concern for headteachers across the county.

Costs have undoubtedly risen in the current year. I have had input from a large number of schools in my constituency; it would be invidious were I to go through every single one of them, but I will focus on one in particular. The Weald school in Billingshurst is an outstanding school. The current head has been in place for eight years. He started with 95 teachers and a senior leadership team of nine, including two deputy heads, and 1,440 pupils. He has managed to maintain 95 teachers, although the senior leadership team has been cut by a quarter, with now only one deputy; but the number of pupils has increased to 1,650—a 14% increase—and there has been a real-terms decrease in the per pupil funding of the school.

As my right hon. Friend the Member for Mid Sussex said when proposing the motion, this has been a problem for 30 years. With extra costs in recent years, reserves have been eaten into and in many cases eliminated. As did other schools in my area, The Weald predicated its financing on fair funding being introduced from 2017-18. It and other schools have had to contend with particular issues that will arise in the current year. From April 2016 there was a 1% increase in teachers’ pay, which meant a 1.23% increase for schools once national insurance is included. That equates to a £75,000 incremental cost to The Weald. For the past 30 years, schools have contributed 14.1% to teacher’s pensions. From September 2015 that went up to 16.4%—for good reasons, but it has an ongoing annual impact of £170,000 on The Weald’s budget. From April 2016, employer’s national insurance contributions were increased, which is an important and valuable change for the Treasury but will cost the school an estimated £120,000.

Looking forward, the impact of changes to the education support grant are expected to add an extra £45,000 of costs, while the apprenticeship levy will add an extra £30,000—and that is before any future increases in teachers’ salaries. The sum of those figures amounts to an estimated deficit of £425,000 in the next financial year for The Weald school. That is why there is so much demand in the immediate term for transitional funding to help schools to get over the hump until fair funding is introduced.

To appreciate the gearing effect, my right hon. Friend referred to £20 million raising the West Sussex average per pupil funding from where it is now, at the bottom, to being halfway towards the average. That £20 million would equate to £250,000 flowing through to The Weald school. As the Minister will see, no one would say that is easy living or easy budgeting in the context of a forecast deficit getting on for half a million pounds, but £250,000 would make a real impact on managing the short-term costs until the introduction of the fair funding formula.

As my right hon. Friend said, in trying to work out what to do, headteachers have been setting out alternative options that they could pursue. The one that has generated the most attention has been the threat to modify school opening hours, which I do not believe is appropriate in any circumstances. None of the other options being considered has happy consequences either; they include larger class sizes where practical, curriculum shrinkage and further staff reductions. It would be particularly galling if reducing the syllabus or not replacing staff occurred on a temporary basis, only to be reversed as and when—we hope—satisfactory results come through from the fair funding of the schools.

I congratulate the Department for Education on pursuing fairer funding, which I trust will put appropriate weight on basic per pupil costs. I recognise the fiscal constraints under which the Department is operating, but I hope the particular funding pressures on schools are recognised. When announcing the decision to delay the implementation of fair funding, the Secretary of State for Education said she would take a sensible approach to transitional arrangements for 2017-18. She made similar statements to the Education Select Committee, to which my right hon. Friend the Member for Mid Sussex referred. I look forward to the Minister’s response, and I also look forward to seeing the Secretary of State this afternoon. This is an issue that I very much hope we can address.

[Tim Loughton (East Worthing and Shoreham) (Con)]

rose—

--- Later in debate ---

[Nick Herbert (Arundel and South Downs) (Con)]

It is a pleasure to serve under your chairmanship, Mr Gray. I congratulate my right hon. Friend the Member for Mid Sussex (Sir Nicholas Soames) on securing the debate on behalf of West Sussex Members, who are concerned about school funding in our county.

I will not repeat the case so ably made by my right hon. Friend and by my hon. Friend the Member for Horsham (Jeremy Quin) for redress to the unfair funding for the county over the mid to long term, because it has been perfectly well set out. I have also set it out before, in a debate in this Chamber last November, and I will spare my colleagues from hearing precisely the same remarks again. Another reason I am not going to set it out is because the Government accept that there is unfair funding in West Sussex. In response to the petition that has been organised by schools in West Sussex, the Government said:

“We recognise West Sussex is a relatively low-funded local authority.”

That is objectively the case—it is the third worst funded authority and is pretty much on the bottom as far as shire counties are concerned.

The Government have recognised the need to do something about that, so we do not just have warm words from them; we have a commitment to introduce the national funding formula. It is important that that is recognised and welcomed, because it is a brave step. Future funding should not be allocated to schools on a rather arbitrary and unfair basis but should be based on a proper assessment of need and with a view to ensuring greater fairness. That commitment was in the Conservative manifesto, the policy was announced by the then Chancellor of the Exchequer and it has been reiterated by the current Education Secretary. I understand that the introduction of a national funding formula has cross-party agreement; perhaps we will have confirmation of that later.

We are not arguing about the need to move to a fairer system in the mid to long term, or whether that will happen. I should just say that I think it is important that those who are pressing for fairer funding in West Sussex acknowledge the Government’s position on this and the commitment to introduce a national funding formula. It does not help when our county council issues statements on the matter and does not recognise that the national funding formula has been pledged, or when headteachers refuse to acknowledge it. I urge those whom I am supporting to take a little more care in ensuring that the way in which they present their case is balanced and is likely to be well received by those who have made a commitment to move in the right direction.

We are discussing the interim situation before the national funding formula is introduced, and the recognition that that formula has been delayed by one year, to 2018-19 rather than the year before as was originally pledged. On the expectation of fairer funding, it will be hard to introduce a fairer formula and not see some improvement for West Sussex, which is funded on the most palpably unfair basis at the moment, and for the situation to improve—but we should recognise that that improvement might be incremental.

In the meantime, schools in West Sussex face a particular difficulty. The Government have protected school spending overall, in the same way they have protected other key budgets, and that should be recognised. In a difficult fiscal framework, when there is a need to save money and when the country still spends more than it earns, the schools budget—a massive budget in the Government’s overall programme—has been protected. Nevertheless, the way in which that has been achieved means there has been flat cash for schools in West Sussex at a time when their costs have increased and costs have been loaded on to them. That was ably set out by my right hon. and hon. Friends.

It might help the Minister if I give a practical example, because I want to persuade her that the impact on these schools is real. In my constituency, we have a very good school, Steyning grammar school, which is in fact a comprehensive, not a grammar school. The excellent headteacher, who is presiding over an increase in standards year on year, has supplied me with figures, which I am happy to send to the Minister. The school has seen a real-terms cut in funding of around 10% since 2010 as a consequence of the increased costs it is having to meet and reductions in certain grants. As a consequence, the percentage of the school’s budget that is accounted for by staff costs is increasing from around 80%, where it should be, to 84%. Teaching full-time equivalents have fallen from 132 in 2010 to 118 in 2016-17.

In budgetary terms, this meant that in 2015 the school’s budget was just at break-even. In this financial year, 2016-17, the school has set a deficit budget of £600,000, which it will cover from reserves, but for 2017 it forecasts a deficit growing to £850,000 a year, which it will not have the reserves to cover. That will require the school to take action and to reduce its staff levels, which are at the national average in terms of ratios. Unlike schools in other parts of the country that are much better funded and have more generous staff-to-pupil ratios, that school does not have room to make those reductions without there being an impact on the delivery of education and, it fears, on standards.

I strongly urge the Minister to look at the funding and the impact on school budgets in counties such as West Sussex that are facing real-terms funding reductions because of these cost pressures. She must look at the impact on those schools’ budgets on the ground, to recognise that they are not engaged in a game of playing bleeding stumps but face particular difficulty.

[Jeremy Quin]

Constituents of mine attend Steyning grammar school, which is an excellent school. With a deficit of £850,000 and staffing at 84%, 85% or 86% of the total budget, if there are forced changes in staff numbers, it would be particularly galling to go through the cost and the pain of reducing staff numbers by whatever means, only to be required as a result of fair funding coming through to then source and recruit new teachers to resurrect those posts and start delivering again for pupils.

[Nick Herbert]

I agree with my hon. Friend. He is much better at maths than I am and is able to point such things out. That is what underlines the whole case for transitional funding. I do not necessarily argue that there is a link between performance in the public sector and funding. We should never assume there is an automatic link between the two, such that any reduction in funding is unmanageable or will have an automatic effect on performance. It is incumbent on any public sector institution to run efficiently and to make savings, but by any objective measure the funding of schools in West Sussex is already among the lowest in the country, so there is no fat to cut without there being an impact.

If we still have to make national savings and the schools budget is to be included within that, that should be achieved on a fair basis, but at the moment, the situation is impacting disproportionately on schools that are poorly funded. That is unfair. I was Police Minister when we cut the policing budget by 20% in real terms, but the impact was felt across all police forces. Although there was some difference in how forces were funded, we did not have a situation where some forces faced no cuts at all and others faced reductions and therefore felt they were being treated entirely unfairly.

It is important to recognise the particular situation of these authorities. That lends weight to the case for some kind of transitional help. Again, the Government recognised that, because in announcing the national funding formula they announced a £390 million uplift nationally in school funding, which was then put in the baseline. That has been applied year on year and is a large sum of money nationally. I recognise that, but if we look at the practical effect, the uplift amounted to less than £1 million for West Sussex’s budget, which meant the actual increase was something like £10 per pupil. The impact on schools’ budgets was therefore relatively low.

Because it was very broad, the distribution of that sum in the transitional uplift did not give sufficient help to the areas of the country that most needed it and was not sufficient to cushion them against the increased cost pressures they are facing. To bring West Sussex up to the average level of county councils—never mind the average national level—would require an uplift of £15 million a year, and it has had less than £1 million. That is why the schools are in this position. To bring funding up to the national average, as my hon. Friend the Member for Horsham said, would require a much greater uplift of £40 million a year.

Because of the cost pressures, the reduction in funding and its effect on schools in the county, and because the national funding formula will not be introduced for two years, there is a strong case for interim funding for the worst funded areas, despite the Government’s overall protection of the budget nationally. That would require taking decisions ahead of the introduction of the formula, which I appreciate would be difficult. It would require finding a basis on which to fund only those schools right at the bottom of the pile, rather than too broadly, which is what happened before. Again, that would be difficult, but it is necessary and right, or else schools in West Sussex will cut their budgets in a way that will see staff numbers fall. That is why I urge the Minister to look at this carefully and to recognise that a very fair and reasonable case is being made by schools in the county and that this deserves special attention.