School Funding: North-east of England

Nick Gibb Excerpts

Wednesday 26th April 2017 Westminster Hall

[Phil Wilson (Sedgefield) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Betts. I congratulate my hon. Friend the Member for Washington and Sunderland West (Mrs Hodgson) who secured this important debate. I pay tribute to my hon. Friends the Members for Middlesbrough South and East Cleveland (Tom Blenkinsop) and for Hartlepool (Mr Wright), who will be leaving our ranks. I am sad to see them go. They are both friends of mine and I know they have been excellent representatives for their constituencies over the years.

“Education, education, education” was the mantra of the previous Labour Government, but we do not hear that now. That mantra is finished and no longer there under the current Government. On funding for schools, we need only look at what Durham County Council said about the effect the cuts will have on schools in the county: the funding formula is likely to lead to redundancies with small schools becoming financially unviable; 50% of primary schools will see cuts and 68% of secondary schools will also lose funding; 111 primary schools will see a reduction in funding of about £10,000 on average; and 21 of 31 secondary schools will see a loss of funding of about £48,000 to £50,000.

The National Union of Teachers and the Association of Teachers and Lecturers have surveyed schools about the funding required from parents, who are being asked to pay for school plays and sports events, and to help fill the funding gaps. One in six parents are being asked to fund their children’s schools; 76% of schools said their funding has been cut; and 93% of schools have said they are pessimistic about future funding. Some parents are paying on average £20 a week to their local school to keep it going.

Parents are being asked to fund sports events, school concerts, arts and design materials, text books, library books, IT and sports equipment. Some 44% of schools are renting out buildings and some are renting out their car parks. That reflects something that happened before. I remember the 1990s when my children were at school under a previous Tory Government, when the schools used to ask for help with funding for text books, pens, pencils and equipment. We have come full circle, but this time it is even worse.

Sedgefield Comprehensive School, which I attended quite a while ago, has been rebuilt under Building Schools for the Future. It is a fantastic facility, with fantastic teaching staff and fantastic children who want to learn and get on, and who aspire to do the best they can in their lives. It was recently named one of the top 50 state schools in the country by The Sunday Times. That is fantastic news. That was established through what the previous Labour Government did. When I compare the school today with what it was like all those years ago, I would say that it has been transformed. The previous Labour Government helped to achieve that. I am proud of our record and of what we have done for that school.

The headteacher, David Davies, has said that

“schools face the prospect of being unable to heat classrooms”

and of being unable to ensure that all the subjects that need to be available can be available. He is the head of one of the top state schools in the country. He has said that it is a “complete and utter myth” that the Government are protecting school budgets:

“In recent years, we have seen pension contributions included as well as moderate pay rises and there has been no increase in the budget”.

Schools NorthEast says that schools in the region would have £42 million to spend on education if they were funded at the national average, and more than £320 million if funded at the London rate. The National Audit Office has said that the cuts will be the equivalent of £3 billion by 2020—£119 million in cuts in real terms for the north-east, which is equivalent to 3,200 teachers. It says that the north-east faces an 8% real-terms reduction in its education funding. Sedgefield comprehensive’s headteacher, Mr Davies, has said:

“This will mean schools having to reduce…services, which could include only heating classrooms for part of the day, reduced investment in school buildings, IT facilities being stretched beyond their usable life and expensive subjects being cut such as music and design technology. It is our responsibility to provide the best possible education, but ultimately parents need to be aware that the future of their son or daughter is at risk with these cuts.”

I am a great believer in aspiration, but it is not achieved with the kind of cuts faced not just in Sedgefield, but around the north-east. When headteachers such as David Davies are coming out and passing those remarks to the local newspaper, we know we have a problem that the Government need to address.

The data for the comprehensives and secondary schools in my constituency show that Ferryhill Business and Enterprise College will have a £253,000 cut through a change in the budget by 2019, which is equivalent to six teachers. Greenfield Community College will have a reduction of more than half a million pounds, which is equivalent to 14 teachers.

[The Minister for School Standards (Mr Nick Gibb)]

Can I just clarify whether the hon. Gentleman is talking about funding to the school, or whether the figures he is citing are the cost pressures facing the school, which is different from the income?

[Mrs Emma Lewell-Buck (South Shields) (Lab)]

It is semantics.

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[Mr Gibb]

It is not semantics. Actual income to schools in Sedgefield goes up under the national funding formula by £300,000, which is a 0.7% rise in income. So that we can have a transparent, honest debate about school funding, is the hon. Gentleman talking about the cost pressures?

[Phil Wilson]

The figures have been quoted by headteachers. They know what the budget pressures are and they say that the budgets are being cut. They say that they are under pressure and are losing funds to the equivalent of the number of teachers I mentioned.

Woodham Academy will lose the equivalent of five teachers. Hurworth School, another excellent school in my constituency, will lose the equivalent of nine teachers; Sedgefield comprehensive will lose 11 teachers; and Wellfield Community School will lose nine teachers. The cut in the budget and the pressures that they have to face is equivalent to £2.2 million.

Part of my constituency takes in the rural aspects of Darlington. Every headteacher from primary and secondary schools in the Darlington borough—39 of them—has written to all parents to point out the dangers to the education of their children because of the changes to formulae and the cuts and pressures on budgets between now and 2020.

[Mr Gibb]

Will the hon. Gentleman give way?

[Phil Wilson]

I will not. The Minister will have plenty of time to make his comments at the end. I want to get through my speech as other people want to make their comments.

There are also cost pressures and budget changes for the primary schools. For Heighington School in Darlington, which is in my patch, that is £125,000. The primary schools in Sedgefield—Sedgefield Primary School and Sedgefield Hardwick Primary School—will see £120,000-odd changes in their budgets. The Minister can shape it any way he wants, but this is affecting schools, teachers and pupils. Headteachers are coming out and saying that, so there is obviously a problem. We can trade figures left, right and centre, but the headteachers are those who know what is happening on the ground.

I want to raise another issue, which is not related to funding but is important to me. It is so important to pupils Christina Davies, Aidan Wong and Melissa Foster from Greenfield School that they came to see me recently. They are concerned about the new GCSEs, where they are treated differently to those in public schools. Only 7% of pupils are in public education—93% are in state schools.

[Phil Wilson]

There is an element of truth in that, and it comes down to the core of my next point, on which I would love to hear the Minister’s comments. In state schools, 40% of coursework used to go towards a final GCSE mark, and there was a chance to sit it in January or June. That cannot be done now. If someone does an IGCSE in a public school, they have the chance to do that, and the result is still recognised by employers.

The pupils from Greenfield school who came to see me are asking why they cannot have a level playing field. If they cannot have 40% of their coursework counted towards the GCSE, why is it not the same in public schools or vice versa? They just want a level playing field and for everybody to be treated the same. Why is it that, just because someone can afford to pay for their child’s education, they have a better chance in life than those children of the 93% of parents who do not have the chance and opportunity to send their children to public school? I am not saying do it one way or the other, but let us have a level playing field. It affects the aspirations and social mobility of our children and is fundamentally unfair.

[Mr Gibb]

indicated dissent.

[Phil Wilson]

The Minister can shake his head, but I have pupils and headteachers coming to see me about this. It is fundamentally unfair when people in public schools have a better chance in life than those children who are sent to state schools.

[Mr Gibb]

Will the hon. Gentleman give way?

[Phil Wilson]

I am going to wind up. The Minister can answer all the points as he wants and I am sure he will. We have a fundamentally unfair system and it needs to be addressed. I am sure my hon. Friends can see that Government Members are shaking their heads. Am I surprised? No, I am not, because they do not believe it is unfair.

--- Later in debate ---

[The Minister for School Standards (Mr Nick Gibb)]

It is a pleasure to serve under your chairmanship, Mr Betts. I start by congratulating the hon. Member for Washington and Sunderland West (Mrs Hodgson) on securing this important debate. I, too, will be sorry to lose the hon. Members for Middlesbrough South and East Cleveland (Tom Blenkinsop) and for Hartlepool (Mr Wright). I have enjoyed debating and sparring with the hon. Member for Hartlepool over many years, both in his role as a Minister for Education and in his more welcome role as a shadow Minister for Education. He carried out both roles with intelligence, humour and application, and I know that I shall miss those debates in the years ahead.

I trust that the hon. Member for Washington and Sunderland West agrees that we share the ambition to see a country that works for everyone and where all children have access to an excellent education that unlocks talent and creates opportunity, regardless of where they live, their background, ability or need. We are introducing the national funding formula in order to tackle the unfairness in the current funding system, using up-to-date data rather than 10-year-old data. That is why, contrary to what has been said today, under the national funding formula hon. Members will see increases in their funding.

I accept that schools face cost pressures, and I will come to those issues in a moment, but let us get the facts clear. Schools in the constituency of the hon. Member for Newcastle upon Tyne North (Catherine McKinnell) will see a £1.6 million increase in funding overall as a direct consequence of the national funding formula. That is a 3.6% increase—85% of schools in her constituency will see an increase in funding. Funding to schools in the constituency of the hon. Member for North Tyneside (Mary Glindon) will increase by £0.8 million, which is a 1.4% increase in spending. She mentioned Holystone Primary School. That school’s funding will rise from £1.43 million in 2016-17 to £1.47 million, on the basis of the new national funding formula—a 2.7% rise. That is a direct consequence of the national funding formula.

As a direct consequence of the new national funding formula, funding to schools in the constituency of the hon. Member for Stockton North (Alex Cunningham) will rise by £0.6 million—a 1.3% increase—and schools in the constituency of the hon. Member for Sedgefield (Phil Wilson) will see an increase in funding of £0.3 million, which is a 0.7% rise. He mentioned Sedgefield Community College, where he went to school. That school’s income will rise from £5.332 million to £5.384 million—a rise of 1%—as a direct consequence of the national funding formula. It is important to distinguish the national funding formula from other cost pressures affecting schools, which I will come to in a moment. Those cost pressures are being absorbed across the public sector.

[Mr Iain Wright]

I am thankful for, and moved by, the Minister’s tributes to me, my hon. Friend the Member for Middlesbrough South and East Cleveland (Tom Blenkinsop) and other colleagues. He talked about funding increases in general terms, which is true, but we are also seeing record pupil numbers. Will he pledge that, as part of the national funding formula, we will see a rise in funding per pupil in the next Parliament? Just to clarify, I am not dead—at least, not yet.

[Mr Gibb]

The hon. Gentleman looks very healthy to me. May I just say that the figures I have cited are for 2016-17 and are based on actual pupil numbers in 2016-17. They do not take into account the extra funds that will come forth as pupil numbers rise.

[Phil Wilson]

The Minister is talking as if there is not a problem. If everything in the garden is so rosy, why is the headteacher of Sedgefield Community College saying that the Government protecting the budget is an utter myth?

[Mr Gibb]

I did not say that there are no issues. I said that there are cost pressures facing schools, but I want to get the factual basis of the issues on the record, so that we know what we are debating. It appears to me that hon. Members in this debate are opposing the national funding formula. The national funding formula is designed to address iniquities in the system and will do so. As a consequence, schools that have been historically underfunded on the basis of their intakes will no longer be so, if and when we implement the national funding formula.

[Mrs Lewell-Buck]

Will the Minister give way?

[Mr Gibb]

I will, and then I will make some progress.

[Mrs Lewell-Buck]

I disagree with the Minister; I do not think we can separate the existing funding pressures from the national funding formula. If he is so confident in the Government’s new national funding formula, why will his Department not publish its response to the consultation before the general election?

[Mr Gibb]

Well, we are now in purdah and therefore it is not permitted for us to make announcements of that magnitude during the election period.

[Mrs Lewell-Buck]

How convenient.

[Mr Gibb]

It is not convenient, actually.

School funding in the constituency of the hon. Member for City of Durham (Dr Blackman-Woods) will rise by £0.4 million—a 0.9% increase—as a direct consequence, again, of introducing the national funding formula. School funding is at its highest level on record, at almost £41 billion this year, and it is set to rise to £42 billion by 2019-20 as pupil numbers rise.

However, the current funding system is preventing us from getting that record sum of money to where it is needed most. Underfunded schools do not have access to the same opportunities to do the best for their children, and it is harder for them to attract the best teachers and afford the right support. That is why we are reforming the funding system by introducing a national funding formula for both mainstream schools and the high-needs support provided for children with special educational needs. It will be the biggest change to school and high-needs funding for well over a decade.

Such change is never easy, but it will mean that, for the first time, we have a clear, simple and transparent system that matches funding to children’s needs and the school they attend. In the current system, similar schools and local areas receive very different levels of funding with little or no justification. Those anomalies will be ended once we have a national funding formula in place, and that is why we are committed to introducing fair funding. Fair funding will mean that the same child with the same needs will attract the same funding regardless of where they happen to live.

We launched the first stage of our consultation on reform in March last year. We set out the principles for reform and proposals for the overall design of the system, and more than 6,000 people responded, with wide support for those principles. Last month we concluded the 14-week second stage consultation, covering the detailed proposals for the design of both the schools and high-needs formulae. Our proposals would target money towards those who face the greatest barriers to their education.

In particular, our proposals would boost the support provided for those who are from deprived backgrounds and those who live in areas of deprivation but who are not eligible for free school meals—those ordinary working families who are too often overlooked. We propose to put more money towards supporting those pupils who have fallen behind, in both primary and secondary school, to ensure that they have the support they need.

[Alex Cunningham]

Will the Minister give way?

[Mr Gibb]

I will not give way now, because of lack of time; I apologise.

Overall, 10,700 schools would gain funding under the new national funding formula, and the formula will allow those schools to see gains quickly, with increases of up to 3% in per-pupil funding in 2018-19 and 2.5% in 2019-20. Some 72 local authority areas are proposed to gain more high-needs funding, and they would also do so quickly, with increases of up to 3% in both 2018-19 and 2019-20.

We have listened to those who have highlighted the risks of major budget changes in our first-stage consultation, which is why we have introduced a floor of a 1.5% minimum funding guarantee per year, and no school can lose more than 3% overall per pupil as a consequence of these changes.

Schools in the north-east would, on average, see a 1% increase in funding as a result of our proposals, and 60% of schools in the region would see an increase in funding, compared with 54% nationally. Schools in the north-east are doing well: 68% of pupils in key stage 2 SATS reached the expected standard in reading in 2016, compared with 66% nationally, and 82% of children are passing the phonics test, compared with 81% nationally.

Of course, the picture would not be uniform across the whole of the north-east. I recognise that the proposals would result in budget reductions for schools in the local authority of the hon. Member for Washington and Sunderland West and no real overall change in funding to schools in her constituency. However, I believe that the formula we have proposed strikes the right balance between the various competing considerations for funding, such as the balance between the core funding that every child attracts and the extra funding targeted at each of the additional need factors. We propose to use a broad definition of “disadvantage” to target additional funding at schools most likely to use it, comprising pupil and area-level deprivation data.

I want to turn to the issue of costs. We recognise that schools are facing cost pressures, including salary increases, the introduction of the national living wage, increases to employers’ national insurance pension scheme contributions and general inflation. From the start of 2016-17 to the end of 2019-20, we have estimated that those pressures will amount to approximately 8% per pupil, on average. To be clear, that is not an 8% pressure in a single year, nor is it an 8% pressure that is all yet to come. In fact, some of those pressures have already materialised and been absorbed in the past financial year. Over the next three years, per-pupil pressures will, on average, be between 1.5% and 1.6% each year. The current, unfair funding system makes those pressures harder to manage, and introducing a national funding formula will direct funding where it is most needed.

We have published a wide range of tools and support to schools, available in one place on gov.uk. That includes tools to help schools to assess their level of efficiency and to find opportunities for savings; guidance on best practice, including on strategic financial planning and collaborative buying; case studies from schools themselves; and support for schools to acquire greater financial skills. We have launched a school buying strategy to support schools to save more than £1 billion a year by 2019-20 on their non-staff spend. That will help all schools to improve how they buy goods and services.

I am grateful for today’s opportunity to debate school funding. A fair national funding formula for schools and high needs underpins our ambition for social mobility and social justice, and it will mean that every pupil is supported to achieve to the best of their potential, wherever they are in the country.