School Funding

Sheryll Murray Excerpts

Tuesday 24th April 2012 Westminster Hall

[Sheryll Murray (South East Cornwall) (Con)]

I thank my hon. Friend the Member for Gloucester (Richard Graham) for securing this debate. I want to pay tribute to the 35 schools in my constituency, all of which aim for the highest standards, not just academically but in extra-curricular activities. I thank the staff for everything that they do in keeping those standards high, and ensuring an enriching and fulfilling education for the children in my constituency.

Funding in South East Cornwall is a big issue. For 2012-13, the pupil premium grant was just under £4,700 per pupil, which is half of that allocated to a child in the City of London. We are, therefore, no better off than a lot of the other areas about which we have heard today. Cornwall comes 134th out of 151 local authorities, and in South East Cornwall the guaranteed unit of funding does not even begin to help the schools in the way that was intended. The Department for Education states:

“As the GUFs are based on previous spending levels, which will have reflected previous allocations, differences will roughly reflect the level of educational disadvantage in each area, area costs, and sparsity (i.e. the fact that very small rural primary schools are more expensive to run).”

I believe, as many hon. Members have said, that we should be spreading the money more equally to assist all children in the same way, regardless of where they live.

The pupil premium is a fantastic innovation of which the Government can be proud—at least they are taking steps to try to address the balance. In 2011-12, 10,700 pupils in Cornwall’s state-funded schools, including academies, qualified for the pupil premium, with total funding of just over £5 million. For 2012-13, the provisional figures are 16,000 pupils—24.6%—and £9.5 million.

Many of the schools in South East Cornwall that I have visited say that the pupil premium rules contain an anomaly, on which several hon. Members have touched. The pupil premium is based on the number of people who are registered for free school meals, but many parents are reluctant to claim such assistance for reasons that range from pride—we see a lot of that in rural farming communities—to simply being unaware of their entitlement. Surely, information is available to the Government that would enable them to identify those who are receiving financial assistance and are therefore entitled to free school meals. Rather than leaving it up to parents to register, it would make common sense for the pupil premium to be based on figures that are already held, and that would ensure that the superb schools in my constituency receive the right funding. Will the Minister consider such a move?

[Mr James Gray (in the Chair)]

From the extreme south-west of England to the extreme north-east.

--- Later in debate ---

[Richard Graham]

rose—

[Sheryll Murray]

rose—

[Ms Buck]

I will give way first to the introducer of the debate.

[Ms Buck]

The issue is more difficult than that. The core of the debate, which I want to come on to, is this. There need to be—the dedicated schools grant was taking us in this direction—some basic building blocks of education funding. The issue then is that although we do not have unlimited money—we did not have unlimited money even in the more generously funded years—we must also recognise that we need to address not just the deprivation element, but things such as special educational needs funding, which is a very difficult issue as well. It is very difficult to achieve what the hon. Gentleman wants to achieve without significant additional funding and without some of the consequences that none of the hon. Members who have so far spoken has been willing to deal with.

[Sheryll Murray]

The hon. Lady mentioned the pupil premium entitlement. Did she mean entitlement or did she actually mean people who are claiming free school meals?

[Ms Buck]

I was about to come to the issue of free school meals. Of course it is difficult to accommodate, as an indicator of deprivation, any element that involves a degree of take-up. All Governments have had to and will continue to grapple with that. Some changes in local government allocations in the funding formulae, which have factored in the index of multiple deprivation and the take-up of tax credits, have proved to be even more difficult, because that variation is even more challenging. Obviously, if we could come up with a deprivation funding formula without dealing with take-up, that would be better. If we could find a way of doing that, I could understand why people would want to do so.

To return to my point, there is a tension between fair funding and progressive funding that we have not managed to resolve. There is also a tension between the core desire to see all schools and all pupils have a basic funding allocation to which a progressive element—a pupil premium or whatever people want to call it—is a relatively small top-up, and the historical desire for local authorities to have a say and for local democracy to be an element in deciding how funding is allocated. In another context, the Conservative party would argue that case quite strongly. One reason why it proved to be such a challenge, not just under the Labour Government but before that, was that local authorities were receiving funding for schools but not passing all that funding on to schools or were making their own decisions about how to share out the grant. Accusations can be levelled at all political parties, in different ways, because of what was done, but of course some of that is intrinsic to local democracy. If we take it out of the equation completely, that throws up other and very difficult questions.

We recognise that school funding is extremely complex, that there is a case for further reform and that that reform is of course far harder to achieve when funding is as tight as it is now. We are seeing the squeeze on school budgets. Even with the pupil premium, funding will fall. At the time of the 2010 spending review, the Department for Education said that total funding for the schools budget would be increased by 0.1% in real terms in each of the following four years. However, subsequent higher projections of economy-wide inflation have changed the real-terms calculation. They indicate, according to the Institute for Fiscal Studies, a real-terms cut over the whole period of about 1% and a small real-terms increase in only one year. Of course, that is at a time when pupil numbers are expected to increase. That gives us an indication of the broader context in which some of these demands have arisen.

To make the position even more complicated for the Government, there is an absolute shambles going on because the Department for Work and Pensions has failed to work out a system whereby the new universal credit can accommodate a proper indicator for school dinners. It is struggling to find a way of doing that. That means that the way of calculating the deprivation indicator is moving even further away from what the hon. Member for South East Cornwall (Sheryll Murray) is saying should be the case. We are, at the moment, at a complete loss to know how the deprivation factor will be properly assessed when it comes to future funding. Both those things—the squeeze on funding and the inability to calculate a future pupil premium, because of the free school meal entitlement shambles—undermine the Government’s case that the problem is so desperate that an immediate solution must be found.

Following the Government’s consultation, the Institute for Fiscal Studies brought out an absolutely damning critique of the Government’s thinking. The report exposes the rather arrogant belief, which we see in so many other areas of public policy, that the problems can be sorted now that we have a Conservative Government, and that the previous Government had, by definition, got everything wrong. When it looked at the small print, however, it found that things were much more difficult.

The report, which I encourage all Members to look at, shows that: the Government’s plans would lead to a large funding transfer from secondary schools to primary schools; the average gains and losses could be 10% or more; one in six schools would face budget losses of 10% or more; there would be huge numbers of winners and losers; and, even over a transitional period lasting six years, some schools would incur annual cash losses of up to 5%. The Secretary of State has therefore started to row back from his enthusiasm for seeing early movement on finding a response.