Core School Budget Allocations

Lindsay Hoyle Excerpts

Tuesday 17th October 2023 Commons Chamber

[The Minister for Schools (Nick Gibb)]

As the Government confirmed in a written ministerial statement yesterday, the Department for Education has corrected an error in the notional allocations of the schools national funding formula for 2024-2025. Those allocations were originally published and notified to the House on 17 July 2023. However, the Department has subsequently uncovered an error made by officials during the initial calculations of the national funding formula. Specifically, there was an error processing forecast pupil numbers, which meant that the overall cost of the core schools budget for 2024-25 would be 0.62% greater than allocated. The Department therefore issued new national funding formula allocations on 6 October to rectify that error as quickly as possible.

The permanent secretary has apologised for the error in writing to both the Chair of the Education Committee and the Secretary of State. The Secretary of State has instructed the permanent secretary to conduct a formal review of the quality assurance process surrounding the calculation and quality assurance of the NFF, with external and independent scrutiny. Peter Wyman CBE, the chair of the Institute of Charted Accountants in England and Wales, will lead the review. Improvements have already been identified to ensure that similar mistakes are not made.

I would like to reassure the House that the error does not affect the overall level of school funding, which remains at £59.6 billion for 2024-25. The Government continue to deliver, in full, the core schools budget, which includes funding for mainstream schools and for high needs. As I said, it will remain at £59.6 billion in 2024-25—its highest ever level in real terms and, of course, in cash terms. That is a percentage increase of 3.2% compared with the current year of 2023-24. Through the schools national funding formula, average funding is £5,300 per primary school pupil and £6,830 per secondary school pupil in 2024-25, up from £5,200 and £6,720 respectively in 2023-24.

Schools have not yet received their 2024-25 funding, so the correction of this error does not mean adjusting any funding that schools have already received. Likewise, the error will not impact on the publication of a dedicated schools grant in December, or on when schools will receive their final allocations for 2024-25. The 2024-25 high needs national funding formula allocations, which fund provisions for children with complex special educational needs and disabilities, are also unaffected by the error, as are other funding streams outside the NFF, including the teachers’ pay additional grant announced in the summer.

I also clarify that the recalculation of the NFF for 2024-25 does not affect the affordability of the 2023 teachers’ pay award. There has been no change to the funding that was promised as part of the pay settlement in July and which the unions agreed meant that the pay award is properly funded. The Government recognise that the correction of the NFF error will be difficult for local authorities and frustrating for some school leaders, which is why the Department has rectified the error as quickly as possible.

[Mr Speaker]

Order. The Minister has taken three, nearly four, minutes. I hope that he is coming to the end of his remarks.

[Nick Gibb]

This is my final sentence, Mr Speaker.

The Department is working closely with school stakeholders, including unions, to communicate this change and support schools and local authorities.

[Nick Gibb]

The hon. Lady refers to RAAC. We took the only decision that any responsible Government would take when the evidence changed on RAAC in school buildings that surveyors had previously assessed as not in a critical condition and we discovered it was not safe for pupils to stay in those schools. There are 174 schools so far confirmed with RAAC, which we have published details of, and we are taking urgent action to make sure that no child or member of staff in our school buildings will be at risk from this reinforced autoclaved aerated concrete—which, by the way, has been around through successive Administrations, both Labour and Conservative, since the 1950s and 1960s.

The hon. Lady refers to £370 million being taken out of the school budget. No money has been taken out of the school budget. It is £59.6 billion next year, and it will remain at £59.6 billion. What would be irresponsible would be to increase funding for schools by 0.62% solely as a result of an error by officials. That is not how Government spending systems work. It has to go through the proper value for money procedures, and that is how we always conduct our allocation of taxpayers’ money.

The hon. Lady talks about standards in schools. We are rising in the international tables. We are fourth in the world for the reading ability of nine-year-olds, according to the recent progress in international reading literacy study, or PIRLS, of pupils of that age. We are rising in TIMSS, the trends in mathematics and science study, and we are rising in PISA, the programme for international student assessment. That is in direct contrast with what happened under the last Labour Government, when we were falling in those PISA tables.

[Mr Speaker]

We come to the Chair of the Select Committee.

[Mr Robin Walker (Worcester) (Con)]

I am grateful for the apology and the letter that the Select Committee received on this issue, which we have published today. Clearly, it is deeply unfortunate that this error took place. It is a result of a complex and very difficult to understand funding system that provides schools with a lack of transparency as to how their funding works in the long run.

We were elected on a manifesto to deliver a fair national funding formula. There were plans in place to legislate for the direct funding of schools. While I welcome my right hon. Friend’s confirmation that this does not in any way affect the high needs block or take money out of the overall school budget, can he update the House on plans to deliver that direct funding formula, which, along with multi-year funding settlements, the Select Committee and the sector have been calling for over many years?