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National Funding Formula Consultation

As you are no doubt aware the DfE are currently consulting on changes to the funding formula with the consultation closing on March 22nd 2017.

The following changes are proposed at this point in time.

How is school funding changing?

Currently, local authorities decide, within a framework, how to distribute the money they receive from government between local schools. This means that a school in one part of the country could receive 50 per cent more funding than it would if it were based somewhere else. To iron out these discrepancies, the government wants school funding to be set at a national level, using a formula that has been published. The new formula will take account of schools with high levels of in-year pupil mobility. It also places heavy emphasis on schools with pupils who are economically disadvantaged but are not necessarily on free school meals.

Which schools stand to lose out under the changes?

There are 9,128 schools that would have been funded at a lower level under the new funding formula, if it had been applied this year – 46 per cent of all schools. The schools most likely to face reductions are in inner London and some other urban areas where levels of relative deprivation have fallen in recent years. The Department for Education document points out that London schools are still funded at the highest level of all schools, mainly due to higher salary costs. There are 49 local authorities set to lose out under the formula.

By how much could funding drop?

The minimum funding guarantee will continue, meaning no school will lose more than 1.5 per cent per year for two years.

Are there any winners?

More schools will win than lose (just over half of schools), and 3,379 schools will see increases to their budget of more than 5 per cent. The maximum they can increase by in 2018-19 will be 3 per cent, rising to a further 2.5 per cent in 2019-20.

At local authority level, 101 areas will be better off under the formula.

The schools set to gain the most include:

  • Schools with high numbers of pupils living in disadvantaged areas that are not necessarily eligible for free school meals. Outside London, the average gain for these schools is 1.4 per cent.
  • Schools with the highest proportion of pupils with low prior attainment but which are not in areas of high deprivation. These gain 2.8 per cent on average.
  • Small, rural schools, which gain 1.3 per cent on average.
  • Primaries schools in sparse communities that are both small and remote, which gain 5.3 per cent on average.

When will the changes take effect?

The formula will come into effect in 2018-19. However, in the first year local authorities’ allocations will be handed down from the government using the new formula, but they will still able to decide how to share the money between the different schools in their area.

From 2019-20 the majority of the funding will bypass local authorities altogether and be sent straight to schools from the EFA (Education Funding Agency). A national £500 million pot of transitional funding is intended to support the move to a new system.

The attached calculator and spreadsheet listing schools across England provides very useful indicative information which we hope will support you in your discussions with schools and to help forward planning.

Download the funding calculator