National Funding Formula

This post contains my personal response to the DfE’s second round consultation on the national funding formula for schools. Individuals, organisations, schools, etc., should feel free to reuse my response. My response is based on my earlier – and lengthier – analysis of the DfE’s proposals, which goes into much more depth. Those interested beyond the specific questions being asked by the DfE should consult the earlier post too.

Please note that consultation responses need to be submitted by 22nd March 2017 and can be done online. Please submit a response, even a partial one. This issue is too important to be ignored!

Q1. In designing our national funding formula, we have taken careful steps to balance the principles of fairness and stability. Do you think we have struck the right balance?

No.

The introduction of a funding floor is a fundamentally unfair approach. The stated purpose of the national funding formula was to provide fairness and end the “postcode lottery”. A funding floor, as envisaged by the consultation document, entrenches the postcode lottery in the current funding environment rather than eliminating it.

Q2. Do you support our proposal to set the primary to secondary ratio in line with the current national average?

Yes.

In the absence of further evidence, this seems like a sensible approach. However I am disappointed that further evidence has not been sought, e.g. a study of the relative primary/secondary performance across different local authorities with different ratios in place. By introducing the NFF, such studies will no longer be possible and so the Government is missing an opportunity to base these decisions on hard evidence.

Q3. Do you support our proposal to maximise pupil-led funding?

No – you should increase school-led funding compared to the current national average

This approach fundamentally ignores the different shape and makeup of schools. It would only be a reasonable approach if costs were all equally pupil-led. Instead, I support the principle of equalising disposable income per pupil. Once fixed costs are taken into account, this principle is opposed to that of maximising pupil-led funding.

Q4. Within the total pupil-led funding, do you support our proposal to increase the proportion allocated to the additional needs factors?

No – allocate a lower proportion to additional needs.

I would have said “don’t know” if given an option here, because the DfE has not presented any evidence that increasing this proportion is an appropriate decision. Equally, I do not have evidence that reducing it would be a good decision. Given local authorities central role in understanding local educational additional needs, in the absence of additional evidence, I believe LA averages should be used, which corresponds to a lower proportion compared to the proposals.

Q5. Do you agree with the proposed weightings for each of the additional needs factors?

Q5a. Deprivation – Pupil Based

No – allocate a higher proportion.

A number of studies, e.g. [1], have shown a stronger link between pupil-based deprivation indices and educational disadvantage than between area-based deprivation indices and educational disadvantage. Once again, a boundary discontinuity study would have been helpful, and I am disappointed that this work has not been undertaken.

[1] C. Crawford and E. Greaves, “A comparison of commonly used socio-economic indicators: their relationship to educational disadvantage and relevance to Teach First,” IFS Report R79, 2013.

Q5b. Deprivation – Area Based

No – allocate a lower proportion

See answer to “Deprivation – Pupil based”

Q5c. Low Prior Attainment

No – Allocate a lower proportion

There is simply no justification given in the consultation document for nearly doubling the funding going through this factor. It is frankly shocking that such radical changes can be proposed with no evidence presented in their favour.

No matter what proportion is decided upon for the initial implementation of the NFF, the Government should commit that in the future, should prior attainment metrics rise nationally, any funding lost to schools through the low prior attainment factor should be recycled into the APWU factor.

Q5d. English as an Additional Language

No – allocate a lower proportion

LAs have chosen to allocate an average of 0.9%. The proposal is to increase this to 1.2%. No evidence is presented to support this change, therefore I cannot support it.

On a related matter, for a fixed pot of EAL funding, there is an argument to be had over whether children would benefit more from considerable funding in year 1 for intensive English tuition to allow them to access the curriculum, rather than more “smeared out” three year funding at a lower level per year. Once again, it would be useful to see the research that suggests that one or the other approach actually reaps the greatest benefit before mandating EAL3.

Q6. Do you have any suggestions about potential indicators and data sources we could use to allocate mobility funding in 2019-20 and beyond?

None

Q7. Do you agree with the proposed lump sum amount of £110,000 for all schools?

7a. Primary

No – Allocate a higher amount

In order to ensure the principle of equal disposable income per pupil, the purpose of the lump sum should not be to “contribute to the costs that do not vary with pupil numbers” but rather to “be a genuine reflection of the costs that do not vary with pupil numbers”

7b. Secondary

No – Allocate a higher amount

See answer to “Primary”

Q8. Do you agree with the proposed amounts for sparsity funding of up to £25,000 for primary and up to £65,000 for secondary, middle and all-through schools?

Q8a. Primary

No – Allocate a lower amount

With a properly funded lump sum that reflects the costs that do not vary with pupil numbers, there is no need for a sparsity factor. Need for a sparsity factor is an admission that there are pupils in “non sparse” areas who are being deprived of appropriate disposable funding.

Q8b. Secondary

No – Allocate a lower amount

See answer to Primary

Q9. Do you agree that lagged pupil growth data would provide an effective basis for the growth factor in the longer term?

No comment

Q10. Do you agree with the principle of a funding floor?

No

The introduction of a funding floor completely eliminates the stated purpose of the NFF. It reintroduces and – worse – codifies – a postcode lottery based on historical funding rates.

Q11. Do you support our proposal to set the funding floor at minus 3%?

No

I do not support the funding floor.

Q12. Do you agree that for new or growing schools (i.e. schools that are still filling up and do not have pupils in all year groups yet) the funding floor should be applied to the per-pupil funding they would have received if they were at full capacity?

No

I do not support the funding floor

Q13. Do you support our proposal to continue the minimum funding guarantee at minus 1.5%?

No – the minimum funding guarantee should be higher (i.e. restrict losses to less than 1.5% per pupil in any year)

I strongly support the existence of a MFG as a way of phasing in funding changes. However, in the present financial climate a MFG of -1.5% is problematic coming on top of other issues such as the radical reduction in the education services grant to local authorities and the apprenticeship levy.

Q14. Are there further considerations we should be taking into account about the proposed schools national funding formula?

As a general principle, deviations from a move to average values across LA funding formulae should be justified and evidence-based. I have provided a lot more questions for consideration in a blog post at https://constantinides.net/2016/12/16/national-funding-formula-for-schools-a-critique/

Q15. Do you agree that we should allocate 10% of funding through a deprivation factor in the central school services block?

No Answer

I am disappointed the options in this questionnaire do not allow me to state “not sure”, because – once again – no evidence has been provided to justify the figure of 10%. What I can say confidently is that the overall level of central school services block is far too low. In effect schools are seeing a significant cut to their funding because they will need to fund services previously provided through the Education Services Grant.

Q16. Do you support our proposal to limit reductions on local authorities’ central school services block funding to 2.5% per pupil in 2018-19 and in 2019-20?

No – limit reductions to less that 2.5% per pupil per year

In line with my school-level comments on MFG, it is important to have transitional arrangements in place. Given the radical cut to the Education Services Grant, it is not clear why the proposed limit of 2.5% is so much greater than the school MFG rate of -1.5%.

Q17. Are there further considerations we should be taking into account about the proposed central school services block formula?

No Answer