National Funding Formula: Social Mobility

Jeremy Quin Excerpts

Tuesday 22nd May 2018 Westminster Hall

[Wera Hobhouse (Bath) (LD)]

I beg to move,

That this House has considered the effect of the national funding formula on social mobility.

My thoughts are with all those affected by the terrible atrocity last year in Manchester. We lived in Manchester for many years, and our children went to the arena many times. It could have been them.

A few weeks ago, I joined headteachers from Bath who had given up their Saturday to march through the city because schools are in the depths of a funding crisis that the Government are refusing to acknowledge. We are at a point where teachers are quite literally shouting in the streets, trying to get the Government to listen to them. Today, I am calling on the Government to listen—to listen to the people who are tasked with preparing the next generation for their lives to come, and to listen to them when they say they do not have enough money to do so.

The issue should not be a political football. Teachers simply do not have the resources to do their jobs properly. In 2015, schools were promised they would be funded in line with inflation. Later they were promised that

“each school will see at least a small cash increase.”—[Official Report, 29 January 2018; Vol. 635, c. 536.]

That has not happened. Schools are facing higher costs from increased pupil numbers, pensions, national insurance contributions, pay awards, inflation and the apprenticeship levy, while facing a reduction in the education services grant. By 2020, £8.6 billion will have been taken out of the system.

School budgets are at breaking point, with 55% of academies reporting deficit budgets and 75% of secondary schools saying they are spending more than their income. Some 23 local authority areas will see cuts of at least 5% by 2019-20. Some 91% of schools face real-terms cuts by 2019-20 as compared with 2015-16. As cuts continue, teachers as well as support staff are lost, because staffing forms around 85% to 90% of school budgets. In the last two years, 15,000 posts have been deleted in secondary schools.

[Jeremy Quin (Horsham) (Con)]

Out of curiosity, I want to pick up on the point the hon. Lady is making and on funds being moved from one part of the country to another. Does she accept there are circumstances where some schools have historically received more funds but have perhaps had demographic changes, while other areas have also had demographic changes but need more funds? There has to be a point where a reallocation is necessary. We need that reallocation in West Sussex, for a start.

[Wera Hobhouse]

I accept the hon. Gentleman’s point, but if he will allow me, I will point out how things look for my local authority of Bath and North East Somerset, where school funding per pupil is falling in 58 schools and increasing in only 17. I would like to see local authorities where that balance is different.

In my local authority, three out of four schools are losing funding. For example, under the new funding system, one school in my constituency—Twerton Infant School and Nursery—will see a 0.5% increase next year. However, in September, it will be paying its teachers 2% more. It will also be paying its support staff between 2% and 5% more. If we add inflation on top—it is currently 2.5%—the financial outlook starts to look incredibly bleak. The school is facing a funding black hole of at least £50,000.

During Education questions last week, I asked the Minister whether school funding was rising in line with inflation. He dodged the question and suggested that the Government were helping schools by giving them advice for managing their energy bills. That very same day, the headteacher at Twerton Infants, George Samios, had been sitting with his business manager trying to find £50,000 in savings. Needless to say, £50,000 is significantly more than the school’s energy bill.

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[Wera Hobhouse]

I am listening to my headteacher, who has given me the numbers. If he gets a 0.5% increase, but has to pick up increases in teachers’ pay and in support staff, his overall funding is going down. If the Minister is happy to meet with me and that headteacher, we can probably discuss it at an individual level.

If children do not receive the right support, they do not reach their full potential, which is a national tragedy, because we lose out as a country. We lose out on the nurses and teachers of the future, the software engineers and the hospitality professionals—the list is endless. We deprive Britain of the people who will continue building its prosperity. The worst thing is that the loss of opportunity particularly affects children and families from poorer areas.

In my maiden speech, I said that whenever I mention that I am the MP for Bath, people go, “Ooh, Bath, how beautiful!” It is, but like almost every other place in the country, Bath suffers from serious inequality. One fact illustrates that perfectly, and it is well known in Bath, but perhaps not outside it. Twerton Infant School, which I mentioned, lies on the number 20A bus route. Three stops on from Twerton, life expectancy increases by seven years. Let that sink in for a second—seven years’ difference over a five-minute bus journey. The so-called “fair funding” formula eradicates the extra funding that used to go to schools in catchment areas with high levels of deprivation.

[Jeremy Quin]

We all agree that funds must be there to support those most in need. Personally, I welcomed the national funding formula’s emphasis on ensuring that children who come from deprived backgrounds, or who have English as a second language and need extra support, get that targeted support. That is in addition to the pupil premium, which was a great triumph of the coalition. I think the hon. Lady is being a little unfair on the national funding formula.

[Wera Hobhouse]

I thank the hon. Gentleman for his intervention. I go by what I see on the ground. I have just explained that I am a trustee of a multi-academy trust. We are facing a problem with the loss of local authority staff, particularly in welfare and support roles. Trusts are meant to pick up those roles. They cannot, because they do not have the money, so staff who are helping young people with difficulties are not supported. That is the tragedy.

The important point is that the schools that most need the support are losing the most money. However, as we know from an announcement last week, the Government have found some extra money—£50 million for grammar schools. To me, that clearly demonstrates that the Government are committed to inequality. Inequality has no place in our society. Every child has the right to achieve their full potential, and should receive the support and education to do so. That costs money, and the state has a duty to provide it.

Schools are in a funding crisis. I very much appreciate the Minister’s being here today. I urge him to listen not just to me, but to teachers and headteachers across the country.

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[Jeremy Quin (Horsham) (Con)]

I am most grateful to be called to speak, Mr Walker, in particular because, only about five minutes ago, I intimated to you that I had not prepared a speech and did not intend to deliver one. I am most grateful that you have found time for me. This is an important subject, which it was important to raise, and I thought it deserved a longer airing in the House than would otherwise have been the case.

I congratulate the hon. Member for Bath (Wera Hobhouse) on securing the debate. My colleagues in West Sussex and I campaigned long and hard for a national funding formula. We were pleased to get a 5% increase in overall funding for the county, so I suppose I should congratulate the hon. Lady on doing better than that—the hon. Lady or, if I may be so bold, her predecessor. A 7% increase is possibly one of the highest increases achieved by any area of the country as a result of the NFF reallocation.

The hon. Lady is right that one can do a lot with statistics, but those I have seen show that we have, as a country, rightly put a huge emphasis on education. I think we have more than doubled our per pupil funding since the early 1990s, and we needed to: we expect a lot more from schools and teachers than we ever did before, and I pay credit to their huge commitment. Perhaps the Minister will correct me if I am wrong, but I believe we spend more per pupil on education than France or Germany. We need to—it is an investment in our future, and I am delighted that we make that commitment as a country. We owe it to our children and to our country to ensure that we have a fantastic cohort of children coming through.

[Fiona Onasanya (Peterborough) (Lab)]

In my constituency, we get £171 less per pupil, so when we talk about funding increases, it is important to bear in mind that, outside London, the situation is not the same for every constituency—the funding formula may not be fair for areas that are deprived.

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[Jeremy Quin]

I am most grateful to the hon. Lady for her intervention. [Interruption.] I hear whispers from the direction of the Minister, so I am certain there will be an answer about per pupil funding of schools in Peterborough. I hope there shall be.

We have to look at where we were before the NFF came in and at what brought me and my colleagues here. The first meeting I had in this place as an MP was with the then Secretary of State for Education to insist that we push through the NFF, because we needed it. Historically, the allocations were all over the place, but data from about 2000 to 2005 revealed genuine demographic changes, meaning that funding should be better allocated.

Disparities between parts of the country remain—the Minister knows I think this—and over time they need to be addressed, but the NFF was a proper step in the right direction of allocating funds according to the need of individual pupils. We need to have a basic amount of funding per pupil, and we need to make certain that we get that right. Beyond that we also need to allocate according to the need or characteristics of individual pupils.

[Wera Hobhouse]

Will the hon. Gentleman not acknowledge that if we simply say, “We will increase per pupil funding,” but do not take into consideration inflation and other pressures on school budgets, such as teachers’ pay rises and so forth, that does not give the proper picture?

[Jeremy Quin]

I totally accept the hon. Lady’s point about significant cost pressures. Some of those have been through the system—we have gone over a hump in cost pressures in relation to pensions in particular—but she makes a valuable point about staff pay. That will need to be addressed, but I am sure we shall hear wise words on funding teachers’ pay rises as they come through.

I recognise the issue of costs, but the debate is about funding and the NFF, and my county will get an extra £28 million as a result of the fully implemented national funding formula. West Sussex needed that funding, and that it received it was right. My secondary schools will get an increase of between 7% and 12%. There are increased costs, and I recognise those pressures, but the NFF is a fairer way of allocating funds than was previously the case.

Similarly to the hon. Lady, I have schools that have not done as well out of the NFF. Some of my primary schools are experiencing significant cost pressures, and I have talked to them and to the county about how to mitigate the impact of cost increases as they affect primary schools. I also have other issues, as the Minister knows. I would like more focus on the high-needs bloc, and I think the ASHE—the annual survey of hours and earnings—formula for allocating local costs of living in different areas could be improved. If I find a better way of doing it, I shall beat a path to the Minister’s door, because areas such as Horsham have very high costs of living, and I am not sure that that is properly reflected in the ASHE formula, which may need some attention.

The motion, however, was about the national funding formula and social mobility. At core, yes, we must make certain to have the right level of per pupil funding throughout the country to ensure that our excellent teachers can deliver the curriculum to the best of their ability and give our kids the head start in life that they need and that we all want for them. However, the NFF is right to go beyond that: we also need to allocate according to the characteristics of the pupils, be that speaking English as a second language, being in receipt of free school meals or having low prior attainment.

Education is part of the answer to help the country achieve better social mobility—it is only part of the answer, but it is an important part. Surely an NFF approach through which we recognise the individual characteristics of pupils is the right approach. The NFF is not the perfect answer, and I shall continue to work on it and to bend the ear of the Minister, but it is a step in the right direction, and the Government were right to introduce it.

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[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.

[Jeremy Quin]

I am slightly frustrated, so I will share my frustration with the Minister. I would like more money to be spent on schools—I think everyone in the Chamber would like more money to be spent on pupils, and we would like better standards even more. I know that standards are rising, and what is being achieved on the attainment gap is great. However, I am frustrated because when the Conservative party came into office with its coalition partner, there was a £145 billion deficit that the kids of today were going to have to pay back. It is all very well wanting more and more money spent on things, but that money has to be raised. In the past, billions and billions of pounds were being left for the schoolchildren of today to repay, and that is not fair either.

[Nick Gibb]

My hon. Friend makes a good point, because that debt also carries an interest charge, which is similar to the overall amount of money we spend on schools each year. If we were to go down the Labour party’s route of promising even more expenditure and borrowing tens of billions of pounds to renationalise whole swathes of the private sector, as was promised during the general election and has been promised since, we would add even more to the interest that we have to pay each year. Indeed, we would have to pay something like £9 billion more in interest charges than we pay already.

When fully implemented, the national funding formula will lead to a 4%—£3.4 million—increase in the constituency of the hon. Member for Peterborough (Fiona Onasanya), and in Oxford West and Abingdon the increase will be 2.4%, which is £1.2 million extra for schools. Once the funding formula has been implemented in full, there will be a 3% increase in funding for schools in Oxfordshire as a whole, which is £10.5 million. The hon. Member for Oxford West and Abingdon referred to high-needs schools, and those schools will get an increase of 3.7% to £60.6 million. That important money is being spent on the most vulnerable children in our society, which is why there has been a 3.8% increase in funding in her area.