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Scope of briefing

This briefing gives a short overview of school funding in England. It looks at overall funding levels, funding commitments made in summer 2019, and the implementation of the National Funding Formula (NFF) for schools.

Overall levels of funding

In recent years, there have been concerns about a squeeze on school funding, in the wider context of increasing pupil numbers and cost pressures. In response, the 2017 Government committed to maintaining core per pupil school revenue funding, in real terms, for 2018-19, and 2019-20. It also said it was helping schools to identify savings. However, concerns remained, particularly around funding for special educational needs and sixth form provision.

Summer 2019 school funding announcements: what was promised?

In summer 2019, the 2017 Government announced it would be providing additional funding for 5-16 year olds in schools in 2020-21, 2021-22 and 2022-23. In cash terms, the annual increases were:

  • In 2020-21, £2.6 billion (on top of 2019-20 funding).
  • In 2021-22, £2.2 billion (on top of 2020-21 funding).
  • In 2022-23, £2.4 billion (on top of 2021-22 funding).

It would also provide around £1.5 billion per year in recognition of additional employers’ contributions to teacher pensions, and £400 million in 2020-21 for 16-19 education.

The Conservative Party manifesto for the 2019 General Election also promised just over £100 million per year in additional funding for a secondary arts premium between 2021-22 and 2023-24, and smaller amounts for physical education in each of those years.

What will the funding be used for?

The 2017 Government said the summer 2019 funding would be used to:

  • Increase the per pupil minimum funding levels attracted by mainstream schools to: £3,750 (in 2020-21) and £4,000 (in 2021-22) for primary schools, and £5,000 in both years for secondary schools.
  • Pay any remaining gains still due under national funding formula (NFF) – so far, gains due have been annually capped.
  • Increase the NFF’s core factor values by 4%.
  • Set a funding floor in the NFF of +1.84% in respect of pupil-led funding, per pupil (compared to schools’ 2019-20 NFF baselines). This is in line with predicted inflation.
  • Increase high need funding by £780 million in 2020-21. Largely, this is for complex special educational needs provision.

Reaction to the summer 2019 school funding pledges

The schools funding announced in summer 2019 equates to a real terms increase of £4.4 billion to the schools budget between 2019-20 and 2022-23. This excludes the teacher pension funding and the additional amounts pledged in the Conservative Party manifesto.

In September 2019, the Institute for Fiscal Studies (IFS) estimated that this additional funding would equate to a real terms increase in spending of 7.4% per pupil between 2019-20 and 2022-23. It would, the IFS said, come “very close” to reversing the 8% (real terms) cut in total school spending per pupil seen between 2009-10 and 2018-19.

Whilst the additional funding has been welcomed, critics have noted that it won’t begin until 2020-21. Others have observed that it may also need to cover significant teacher pay increases and have raised concerns about how the money will be shared out.

What is happening with the national funding formulas (NFF) for schools and high needs in 2019-20 and 2020-21?

Since 2018-19, a new National Funding Formula (NFF) has been used to determine how much mainstream schools attract in core revenue funding. There are separate formulas for sixth form, high need, and early years funding. Pupil Premium (additional money to support disadvantaged children) is also paid via a separate grant.

In 2019-20 and 2020-21, the schools NFF is only being used to work out notional allocations for individual schools. These are then aggregated, adjusted and passed to local authorities, who then draw up local funding formulas for onward distribution. This is known as a soft NFF.

One change for 2020-21 is that local authorities will be required to pass on the new minimum funding levels in the NFF to individual schools, via their local funding formula arrangements. The Department for Education has recently consulted on how to implement this change, and on the circumstances in which the requirement could be disapplied.

The 2017 Government said that it remained committed to introducing a hard NFF, but did not set a deadline for this. A hard NFF would largely removing the role of local authorities in distributing core schools funding.

What impact will the recent funding announcements have on particular individual schools?

The DfE published notional, provisional NFF allocations at school and local authority level, on 11 October 2019.

A House of Commons Library Insight article provides analysis of these figures, and constituency estimates of the real terms change in per pupil NFF allocations in 2020-21 (compared to the 2019-20 notional NFF baseline allocations).

The DfE’s October 2019 notional school-level allocations are not what individual schools will actually receive through the NFF in 2020-21; local authorities will retain a degree of flexibility in determining local funding arrangements.

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