School Funding Formula

Richard Graham Excerpts

Tuesday 10th March 2015 Commons Chamber

[Mr Walker]

My hon. Friend is absolutely right. The emergence of multi-academy trusts provides another argument for fairness in the funding system.

[Richard Graham (Gloucester) (Con)]

Will my hon. Friend give way?

[Mr Walker]

I am afraid not, I am sorry.

The F40 finance group recently met Department for Education officials and discussed these proposals. The initial feedback was very positive. It was clear that under F40 proposals there would be more gainers and fewer losers than under the current formula.

The only challenge now appears to be the political will to deliver. We are beginning to hear from all the parties what they will be offering in their manifestos. We hear that the Conservative party would protect the cash settlement for schools in per-pupil terms. The coalition is already targeting money per pupil numbers. The Labour party seeks to protect the overall schools budget and the Liberal Democrats to protect the whole of the two-to-18 education budget. The problem with any protection for budgets as a whole is that it might produce a reduction in per-pupil funding, as pupil numbers are set to grow rapidly. It has been argued that Labour’s promise of an inflationary increase in this era of low inflation could deliver lower per-pupil funding than the Conservative proposal of flat cash per pupil.

Whatever the outcome of the election, it is clear that there will be ongoing fiscal pressure on all our schools. It is perhaps understandable in that situation that Ministers are keen to avoid turbulence, but avoiding turbulence has been the main reason for not going further and faster on school funding reform in the lifetime of this Parliament. It can no longer stand. We need to make it clear that to translate any freeze in per-pupil spending overall into a freeze in the unfair formula that currently allocates it would be totally unacceptable.

We can see all too directly the pressures on schools in all of our constituencies. We know that those pressures have built up not just in a few short years of tighter budgets, but over decades of comparative underfunding. It is simply not possible in these circumstances to justify the £900 per-pupil gap between Worcestershire schools and those in neighbouring Birmingham; the £700 gap that used to exist between Leicestershire and Leicester; or the £550 gap between Devon and Bristol—still less the mind-bogglingly vast gap between the best funded and worst funded authorities. In rich London boroughs such as Kensington and Chelsea, the per-pupil funding is £5,866 and it is £6,221 in Islington, while in poorer northern towns such as Barnsley it is more than £1,700 less.

I say to Ministers and shadow Ministers that F40 has made detailed proposals for change and I hope that they can accept them. They should deliver us a fair formula and help us to close the gap between schools that have missed out for far too long and those in the best funded areas. Overall, the allocation we have put forward would be more even, fairer and would target deprivation more effectively. The pressure on the education budget makes the timetable for delivering this new formula more urgent than ever. F40 members recognise that minimum funding guarantees may be needed to smooth out the introduction of a new formula, but we are not prepared to wait for ever while they are applied. We therefore call for the move to be conducted in a maximum of three years.

We have come a long way. The argument for fairer funding has been accepted on all sides. We must now be clear that its non-delivery—whether it be for political or administrative reasons—would be totally unacceptable. To entrench the progress made, I urge the Minister to ensure that the £390 million already secured for the lowest funded areas should be baselined in the education budget for 2016-17 so that the move to a new formula will start with that downpayment taken into account. I challenge all parties to address that challenge and to deliver the fair and transparent formula that our constituents deserve.

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[Nic Dakin]

Any progress should certainly be built on by a future Government. North Lincolnshire, the area that I represent, is historically underfunded. We stand to benefit and to be a potential winner, but the change must be smoothed for those who are less advantaged, and I think that the F40 principles will help in that regard. Core entitlement at pupil level is the main building block that will give schools access to similar resources for basic classroom costs, wherever those schools may be, but pupil needs beyond the core entitlement will also be recognised. Factors such as deprivation, special educational needs and the existence of small schools in small communities should be taken into account. That is the second building block. As for the third, the existing dedicated schools grant structure should continue to be part of the framework. I think that those three principles will be helpful to any future Government.

When we talk about school budgets, we should recognise that funding for those over 16 has been particularly badly affected in recent years.

[Richard Graham]

The hon. Gentleman is absolutely right. It is hardest for schools with sixth forms, and those that do not have a very large percentage of disadvantaged pupils who receive the pupil premium. Does the hon. Gentleman agree that it is essential to get the core funding right for the F40 group, so that those schools can balance their books in the next few years?

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[Kevin Brennan (Cardiff West) (Lab)]

The hon. Member for Worcester (Mr Walker), whom I congratulate on raising this matter, referred to the observation of the hon. Member for Gloucester (Richard Graham) that this subject resembles the Schleswig-Holstein question. As I recall, Palmerston said that of the three people who knew the answer to that, one was dead, one had gone mad and the other one had forgotten the answer. Perhaps that is why it has been so difficult for the Government to do what they pledged to do at the beginning of this Parliament: to introduce—[Interruption.] I am struggling to make myself heard because the Parliamentary Private Secretary is saying that it is ridiculous to suggest that it was difficult for the Government to introduce what they pledged to introduce at the beginning of this Parliament—that is, a national funding formula. It has been extremely difficult.

That is why the Schools Minister last year, rather than do what was promised in the coalition agreement and introduce that new national funding formula in the course of this Parliament, decided, understandably, to throw some money at it. I am not criticising him for finding it difficult to tackle this Schleswig-Holstein-style question with which he has been wrestling for some of the past five years.

[Richard Graham]

rose—

[Mr David Heath (Somerton and Frome) (LD)]

rose—

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[Richard Graham]

That is very kind of the shadow Minister. The reason why I used the Schleswig-Holstein analogy was that if one looks at the funding for Gloucestershire at £4,195 per head and compares the schools that we have, which are multicultural, urban, inner-city schools, with those of Birmingham, which get £5,210—over £1,000 more per pupil—it brooketh no understanding. Does the shadow Minister agree?

[Kevin Brennan]

I know the hon. Gentleman is not the one who is dead, I know he is not the one who is mad, and I do not think he has forgotten the answer because he has tried to provide us with it, but as I said last year when we debated the subject in Westminster Hall, I accept that there are undoubtedly wide disparities in funding among different areas. Some of those disparities—[Interruption.] Again, I am being barracked by the PPS. If he wants to intervene, I will be happy to give way. If not, I give way to the hon. Member for Somerton and Frome (Mr Heath).