School and Early Years Finance (England) Regulations 2018

Debate between Sarah Champion and Nick Gibb

Wednesday 21st March 2018 General Committees

[Sarah Champion]

I did not know that, but it pains me to hear it. When I was going through school and university, people aspired to become a teacher. Teaching was a secure career in which people felt they were giving something back to their community. Now, it is seen as something to try to escape from, and we do not attract the best people to be teachers. That is such a shame. The impact on future generations is immeasurable.

Why has there been such a dramatic rise in the ratio of pupils to staff? It is not rocket science. To try to bridge the gap between their costs and the income they get under this Government, schools have had to lose staff. In the same period—2014-15 to 2016-17—staff cuts in primary schools increased by 44%, and cuts to secondary teaching staff in Rotherham rose by a staggering 93%.

Using that as my evidence, I guess that class sizes in Rotherham will increase again for the next two years under this Government. Schools will be forced to cut more staff, so the pupil to staff ratio will increase. There is no evidence—if anyone can show me some, I would welcome that—that bigger classes lead to a better education. I have not discovered evidence of that anywhere in the world. To be honest, all the evidence points to bigger classes leading to worse education.

Are children in Rotherham worth a good education? Is it a surprise that we have some of the highest rates of exclusion and youth unemployment when there is not enough money to pay for an adequate number of teaching staff? I am afraid that things will only get worse under the regulations. The minimum funding guarantee in the local formula is currently set at minus 1.5%. That is a guarantee that no school can lose more than 1.5% of its per pupil funding year on year as a consequence of changes to the local funding formula. Paragraph 8.4 of the explanatory memorandum states:

“The new level of flexibility around the MFG set out in these Regulations will allow local authorities to set the MFG at any value between -1.5% and +0.5%, allowing them to replicate this element of the national funding formula at a local level if they choose.”

The second stage of the consultation underlined the importance of stability in funding levels for schools. As a result, the national funding formula will allocate a cash grant of at least 0.5% per pupil for every school. This new MFG flexibility will enable local authorities to pass those gains on to schools, but here is the but—as of yesterday the CPI inflation rate dropped, woohoo, to 2.7%. Even if the local authorities had the cash to apply the maximum funding of plus 0.5%, schools would still be losing 2.2% in real terms. Perhaps that is why paragraph 10.3 of the explanatory memorandum says:

“An Impact Assessment has not been prepared for this instrument.”

One wonders why.

[The Minister for School Standards (Nick Gibb)]

Because it does not affect the private sector.

[Sarah Champion]

I appreciate the clarification from the Minister.

I would now like to ask him a couple of specific questions, if he can answer them. Let me quote part 3, chapter 1, regulation 13(3):

“The date for ascertaining pupil numbers is 5th October 2017.”

I will give an example of why that is likely to present problems in my constituency. In an area of Rotherham called Eastwood, we have quite a large Roma population and I have spoken to a number of my primary schools to discover what happens. Children tend to be signed up for the autumn term and start in September but then go missing, reappearing later in the year. I am concerned that class sizes might have increased after 5 October but the funding might not follow that.

In addition, because we have a lot of cheap privately rented accommodation, a lot of asylum seekers are sent to Rotherham. They come throughout the year, so what happens to pupil funding if, again, they arrive after 5 October? I am not sure whether the Minister has some money ring-fenced for when classes ebb and flow but his response would be most helpful, because I know it is an issue for my schools.

Regulation 18(3), in the same chapter, states:

“For the purposes of this regulation, a child is disabled if he or she is paid or entitled to disability living allowance by virtue of section 71 of the Social Security Contributions and Benefits Act 1992.”

My hon. Friend the Member for Wythenshawe and Sale East mentioned special educational needs and how late children are now getting statements. In my constituency it is getting increasingly hard to get statements because of access to the services that can do the assessment. A child might enter a school without a statement but after a couple of years get a diagnosis, for example, of autism. Would the additional money follow through with that child, once the diagnosis is in place?

My final point concerns chapter 2, regulation 27, which discusses how funding will be clawed back from maintained schools if a child is excluded. Does that provision also apply to academies?

--- Later in debate ---

[Nick Gibb]

The hon. Member for Wythenshawe and Sale East said from a sedentary position that it is 0.5%. Schools in Faversham and Mid Kent would attract 6.4% more funding if the national funding formula were implemented in full based on the 2017-18 data. That is equivalent to £2.7 million, so I understand why my hon. Friend the Member for Faversham and Mid Kent made her intervention.

The new funding formula will be fairer. The additional funds mean, as I have said, that spending will rise from £41 billion this year to £43.5 billion by 2019-20. As the independent Institute for Fiscal Studies has confirmed, that will allow us to maintain schools and high-need funding in real terms per pupil for the next two years. I hope that answers the comments made by the hon. Member for Wythenshawe and Sale East. As the IFS also pointed out, by 2020 real-terms funding per pupil will be 70% higher than it was in 1990, and 50% higher than it was in 2000.

[Sarah Champion]

When the Minister was talking about the increases over the next two years, I did a quick bit of maths. The increase seems almost to keep up with inflation, but there does not seem to be any additional money on top of that. Does the Minister agree?

[Nick Gibb]

I will come to the cost pressures that schools have faced in the last two years, particularly the increase in the employers’ contribution to teachers’ pensions—we regard teachers’ pensions as very important—and the higher level of the employers’ national insurance contribution. Again, the higher employers’ national insurance contribution is about raising more tax revenue to help close the historic deficit we inherited. Achieving the reduction of that deficit to 2% of national income, from 10% when we came into office, has enabled us to maintain a strong economy. We acknowledge that there have been cost pressures on schools in that period. Those cost pressures have now been absorbed and schools will see real-terms increases across the board in their funding, taken as a whole.

[Nick Gibb]

The hon. Lady raises an important point. We have given evidence to the School Teachers Review Body; the Secretary of State gave oral evidence a week ago. We will receive its recommendations, I think, in May and we will respond to them then. It is important that these issues are dealt with by independent pay review bodies.

With the additional £1.3 billion that we were able to identify last summer, we have been able to ensure that all schools and all areas will attract some additional funding over the next two years while providing for up to 6% gains per pupil for the most underfunded schools. That significant extra spending in our schools demonstrates our commitment to ensuring that each child receives a world-class education. The hon. Member for Wythenshawe and Sale East cited our manifesto; we have gone further than our manifesto commitment that no school should lose funding as a result of the national funding formula. Now, every school in every area will attract at least 0.5% more per pupil in 2018-19 than it received in 2017-18, and 1% more in 2019-20.

We also heard throughout our consultation on the formula that we could do more through our formula to support those schools that attract the lowest levels of per pupil funding. We listened to those concerns, and our formula rightly will direct significant increases towards those schools. In 2019-20, the formula will provide minimum per pupil funding of £4,800 in respect of every secondary school, and £3,500 in respect of primaries. In 2018-19, as a step towards those levels, secondary schools will attract at least £4,600, and primary schools £3,300. These new minimum levels recognise the challenges of the very lowest funded schools.

There was considerable debate during the consultation on the funding formula about how much funding it was appropriate to direct towards schools with higher numbers of pupils likely to need additional support—I welcome the hon. Gentleman’s support for that element of the national funding formula—as a result of a disadvantaged background, low prior attainment, or because they speak English as an additional language. In our final formula, we have been able to protect this funding—£5.9 billion in 2018-19—while improving its targeting. Alongside that, we will continue to deliver the pupil premium— some £2.5 billion a year—to provide additional support to schools to narrow the attainment gaps and to promote social mobility. As I mentioned earlier, we have closed the attainment gap by 10% in both primary and secondary schools since 2011.

The dedicated schools grant provides local authorities with funding for their high needs provision and for early years. We are absolutely committed to supporting children who face the greatest barriers to their education. That is why we have also reformed the funding for children and young people with high needs, by introducing a high needs national funding formula. That will distribute funding for children and young people with high needs more fairly, based on accepted indicators of need in each area.

The additional spending that we have announced means that every local authority will see a minimum increase in high needs funding of 0.5% in 2018-19, and 1% in 2019-20. Underfunded local authorities will receive gains of up to 3% per head a year for the next two years. Overall, local authorities will receive £6 billion to support those with high needs in 2018-19. We are also determined to support as many families as possible with access to high-quality, affordable childcare. That is why in 2019-20 we will spend a further £6 billion on childcare support—a record amount of support. This record spending includes £1 billion a year, delivering 30 hours of free childcare for the working parents of 3 and 4 year-olds and funding the increase in rates that we introduced in April 2017.

[Sarah Champion]

I welcome the fact that the Minister talks about childcare, as that is one of the quickest and most effective ways to bridge the gender pay gap and to get women back into work. The National Audit Office says that Sure Start funding, which is very close to my heart, has been cut by £763 million since 2010. How does that fit into the Minister’s attempt to support all children?

[Nick Gibb]

We have to marshal our resources. A lot of the statistics cited on Sure Start are to do with buildings and not the provision of services in those buildings. Schools in Rotherham would attract 4.5% more funding if the national funding formula were implemented in full, based on the 2017-18 data, coming to £2.9 million. Under the national funding formula, schools in Rotherham will be funded at £4,982 per pupil, compared with the national average of £4,655.

--- Later in debate ---

[Nick Gibb]

We have some of the lowest levels of young people not in education, employment or training —lower, certainly, than under the previous Labour Government. We have very low levels of youth unemployment compared with other countries in the European Union, and we have the lowest level of unemployment in this country for 42 years. That is the consequence of proper stewardship of our public finances and our economy. That is how we provide opportunities and social mobility, ensuring that more people have the opportunity to earn a pay packet, and pay their rent, mortgage and bills. I will give way to the hon. Member for Rotherham.

[Sarah Champion]

The Minister is incredibly kind and intuitive, and I thank him for giving way without my asking—[Laughter.] He could see that I was willing him to do that; he is a good man. I would love him to come to Rotherham. I am grateful for the £20 uplift per primary school child that comes on top of the cuts we have sustained for the past eight years, but £20 will buy us a book and a couple of pots of paint; it will not deal with the decades of deprivation faced by my constituents. I understand that the Minister is genuinely trying to come up with a fair funding formula, but life is not fair. In Rotherham we have had so many knocks and lost so much industry that a small increase is not enough to get us to the standard of a school in Surrey, for example. I urge the Minister to reconsider.

[Nick Gibb]

I would be delighted to go to Rotherham again. I was the candidate there in 1994 in a by-election. I thoroughly enjoyed my stay, and I was delighted narrowly to beat Screaming Lord Sutch. The hon. Lady raises an important point, and the £2.9 million extra funding is equivalent to about £214 per pupil in Rotherham. I would be delighted to come and see some schools in Rotherham soon.