PARLIAMENTARY DEBATE
National Funding Formula: Devon - 6 February 2017 (Commons/Commons Chamber)

We received 6,000 responses to the first stage of the consultation on the national funding formula, which sets out the principles and factors to be used in the formula. We continue to receive representations on the second stage of the consultation, which closes on 22 March. Our proposals for funding reform will mean that schools will, for the first time, receive a consistent and fair share of the schools budget, addressing the anachronistic unfair funding system that has been in place since 2005.

Exeter schools already suffer a double whammy—they are in one of the lowest funded counties in England, and they have to subsidise the high cost of providing school transport and keeping open small rural schools—yet the new funding formula will actually make them worse off. How will the Minister explain that to my constituents and to the schools themselves?

In Devon, as a result of the new funding formula and on the basis of the figures for 2016-17, school funding would rise from £377.2 million to £378.7 million, an increase of 0.4%. In the right hon. Gentleman’s Exeter constituency, there will be no overall change in the level of funding, although there will of course be changes between schools. Whenever we introduce a new national formula and illustrate it on the basis of the current year’s figures—in this case, 2016-17—some schools will inevitably gain and others will lose. Overall, 54% of schools across the country will gain under the new national funding formula.

If these proposals are adopted, the historically underfunded constituency of East Devon will have 15 primary schools that gain while 20 lose out, and all our secondary schools will lose out. That is clearly neither fair nor acceptable. Will the Secretary of State agree to meet me and other Devon MPs so that we can make our point yet again?

I am very happy to meet my right hon. Friend. I think that the Secretary of State has already met Devon MPs to discuss this matter, but I am sure that she will do so again.

I understand the concerns of my right hon. Friend the Member for East Devon (Sir Hugo Swire). There is a small fall in overall funding in his constituency, although 40% of schools in East Devon will see a rise in income on the basis of the new formula. The new funding formula attaches a higher value to deprivation than Devon’s local formula, so schools in Devon with a low proportion of pupils from a disadvantaged background or with low prior attainment do less well under the national formula. I am sure that my right hon. Friend will continue to make representations through the consultation, which closes on 22 March.

Order. By his earlier reference to the situation “across the country”, the Minister extended the question beyond Devon, allowing other would-be contributors to ask a question.

The head of one of my local academy trusts tells me that his school will lose more than 2.5% of its overall budget as a result of the national funding formula alone. That figure is higher than the 1.5% cap promised by the Government. Does the Minister share the trust’s view that the cuts will have the biggest impact on deprived and vulnerable children? If so, what are the Government doing?

No, I am afraid that the hon. Lady is wrong. We aggregated all the local funding formulae across the 150 local authorities and looked at the level of deprivation. We are allocating 9.5% of the national funding formula to deprivation, which is broadly in line with the existing position. We have also increased the amount in the funding formula that goes to children who start school behind. The scheme is deliberately designed to help children from disadvantaged backgrounds who are falling behind. I would have thought that the hon. Lady, representing the constituency that she does, would support a fairer funding system that helps those particular children.

I accept my hon. Friend’s comments. Schools in his constituency will gain about £300,000 of funding overall—a 0.6% increase. On the basis of illustrative figures for 2016-17, 70.6% of schools in his constituency will actually gain funding, compared with 29% that will lose a small amount.

Because the hon. Lady’s constituency will remain one of the highest-funded areas of the country. She is right that the per pupil funding rate in Lewisham, Deptford will fall from £5,708 to £5,550 as a result of the national funding formula, but that is still one of the highest in the country. The prosperity of London as a whole has increased over the past 10 years, with the proportion of children on free school meals falling from 27% to 18%, but it still has some of the highest levels of deprivation. That is why, under the new national funding formula, London’s funding remains 30% higher than the national average.

I welcome the principle of the new national funding formula, but one third of schools in North Devon look set to lose funding under the indicative figures. Will the Minister continue to listen carefully to our representations? Will he also confirm whether the indicative figures are just that and that they could be subject to some revision?

Yes, of course. The consultation is genuine and has been extended for two weeks until 22 March so that we can hear representations from my hon. Friend, from other Members and from members of the public.

Will the Minister confirm last week’s report that the Secretary of State handed back to the Treasury £384 million that was earmarked for school improvement? Does he agree with the estimate of London Councils that it would take £335 million to ensure that no school loses out under the new funding formula?

The hon. Lady should know how negotiations with the Treasury work. We negotiated a good agreement with the Treasury and have protected core school funding in real terms. We are spending £40 billion a year on school funding—a record high figure—and that is set to rise, as pupil numbers rise over the next two years, to £42 billion by 2019-20. The figure that she refers to is about the cost of academisation. That proposal continues, but we are not targeting the same timetable that was agreed in the previous White Paper.

The Minister will be aware that Torbay’s schools benefit overall from the proposals, yet the grammar schools that serve a large swathe of south Devon do not. I thank him for his courtesy in recently meeting the heads of those schools. Will he update me on when we are likely to receive a detailed response to the points we raised?

As I said at the meeting, which I enjoyed very much, schools in my hon. Friend’s constituency will gain £1.2 million of extra funding under the new national funding formula, which amounts to an increase of 2.4%. The funding of 78% of schools in his constituency will increase as a result of the formula. I listened carefully to the representations that he and headteachers in his constituency made, and I will respond to him shortly.

The Minister said earlier that it will be schools with fewer deprived pupils and better prior attainment that are likely to lose out under his proposals, but in my constituency that is simply wrong. The nine schools that will have their funding cut are in the most deprived parts of the city where, on average, children start school 20 months behind where they should be in their development. Something has gone very badly wrong with his plans. Will he look again and explain to me and the teachers in my constituency why the kids who need help the most are going to lose out?

The hon. Lady will have looked at the consultation document and seen that a very high proportion of the national funding formula is allocated on the basis of disadvantage—it is based on pupils’ low prior attainment and things such as English as an additional language. The difference is that we are basing the national funding formula on today’s data, not the data as they were in 2005. As my right hon. Friend the Secretary of State has said, we have a once-in-a-generation opportunity to put in place something that the Labour party neglected to do: a fair national funding formula that is based on a clear set of factors and principles, and on up-to-date data.

In East Sussex, funding per pupil is £193 lower than the national average. What more can be done for my schools in Wealden, which are both small and rural?

We have ensured that sparsity is an important factor in the national funding formula and we are increasing funding for the sparsity element from £15 million to £27 million across the system. East Sussex sees an increase in its funding overall and my hon. Friend should welcome this much fairer system. It is fairer to schools in East Sussex and right across the country.

I suggest that the hon. Lady tells schools in Hull that, because of the way in which the new national funding formula addresses historical anachronisms and because of our focus on tackling deprivation, Hull’s school funding under the formula rises from £157 million to £161.7 million, which is an increase of some 3%. In her constituency of Kingston upon Hull North, funding rises by £1.4 million, with 83% of her schools seeing an increase in funding on the basis of 2016-17 figures.