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The Department for Education is one of the big four spending departments, along with health, defence and work & pensions. The DfE plans a Resource DEL (day-to-day spending) of around £68.5 billion in 2019-20. This is around £9.5 billion lower than 2018-19, however excluding student loan impairments it has increased by £2.3 billion (3.4% in cash terms). 

The DfE’s spending is dominated by grants to schools, which in 2019-20 makes up three-quarters of day-to-day spending at around £52 billion. This is a cash increase of 4% compared to 2018-19. The DfE’s planned 2019-20 capital budget is around £5 billion, a cash decrease of 10% compared to 2018-19. The DfE’s planned 2019-20 Further Education budget is around £4.8 billion, a cash decrease of 3% compared to 2018/19. An estimated £23.9 billion in student loans is expected to be paid out this year, with capital repayments amounting to £2.6 billion.

The Government introduced a new national funding formula (NFF) for schools from April 2018. It is currently in a “soft” format which will continue into 2020-21. This means the NFF is only being used to work out notional allocations for individual schools. These are then summed and passed on to local authorities, who then draw up local funding formulas for onward distribution.

Funding for schools has been relatively protected, by Government pledges, from spending reductions in recent years in various ways. The Institute for Fiscal Studies (IFS) estimates that under the Coalition Government, schools’ funding was largely constant in real terms per pupil but from 2015-16 to 2017-18, fell in real terms by just over 4% per pupil. The IFS also notes that school funding per pupil is expected to be frozen in real terms between 2017–18 and 2019–20. At the same time, schools have faced additional cost pressures from pay, additional employers’ national insurance payments and other sources.

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