Ministers are asking for views both on the schools national funding formula and a high needs funding formula.
The Department for Education said that the schools funding consultation was the start of a move towards a system where school funding is allocated on a consistent national formula.
From 2019-2020, funding will go directly to schools from central Government, bypassing local authorities completely, in changes set out by education secretary Nicky Morgan.
While local authorities’ role in basic funding allocations will be phased out, the DfE said they would continue to play a vital role in distributing ‘significant additional funding’ to help pupils with high-level special educational needs and disabilities ‘on a fair and formulaic basis, so that no pupil is disadvantaged simply by where they live.’
The high needs funding formula consultation is looking at ways to improve the way that this money is distributed to early years settings, schools and others, that is more 'formula-driven' based on need, rather than only using historic spending patterns.
As already announced, there will also be a parallel consultation on a national funding formula for early years funding later this year.
Under the current system there is no notional SEN funding for early years providers.
Claire Schofield, National Day Nurseries Association’s director of membership, policy and communications, said the removal of the local authority role from schools funding ‘raises questions about the future of early years funding.’
She added that there was concern among early years settings about whether the funding rate for high needs would be enough, particularly for disadvantaged two-year-olds.
Research carried out by ISOS for the DfE last year looked at how the funding system for SEN might be improved, and its recommendations are included in the consultation.
ISOS proposed that local authorities should work with early years providers to set out clear expectations about the support pre-school settings are expected to provide from their core funding, and the circumstances where extra advice, training or resources would be provided.
Sense, the deafblind charity, said that reforms to early years funding need to recognise the extra costs of provision to children with special educational needs and disabilities.
Kate Fitch, head of public policy at deafblind charity Sense, said, ‘The Government should use the consultation as an opportunity to address the differences in the way schools and early years settings are funded, and to make sure they can meet the additional costs of provision for children with special educational needs and disabilities.
‘Reform to the Early Years Single Funding Formula must recognise that there are additional costs for providers offering places to children with additional needs and enable them to meet these in a timely way so that all children get the best support possible.’
The case for change - schools funding
The Government is consulting on a schools national funding formula in the first stage of its plans to reform education funding, to ensure that every school and area is funded fairly.
The aim is to end the historic inequitable funding system, which ministers believe is outdated, inefficient and unfair.
A second stage consultation will set out illustrations of the impacts of the funding formulae across schools and local authorities.
The changes will be gradually phased in with a national funding formula staring in 2017 to 2018, and from 2019-20 local authorities will no longer be involved in deciding how funding for schools is allocated.
Under the current system, a school in one part of the country could receive more than 50 per cent more than an identical school with exactly the same children, simply because of an accident of history.
For example, Rotherham and Plymouth currently have a similar percentage of children eligible for free school meals, but currently those in Rotherham receive nearly £500 more per pupil than Plymouth.
The funding pupils are allocated varies widely by local authority because local authorities use different funding formulae and are able to make different decisions around funding.
A secondary school pupil with low prior attainment would receive £2,248 of extra funding in Birmingham, compared with £36 in Darlington.
The consultation proposes that four factors should be considered as part of allocating core schools funding:
- basic per pupil funding;
- funding for additional needs, including deprivation, low prior attainment, and English as an additional language;
- school costs – including fixed costs and those related to schools serving rural communities;
- and area costs – ensuring more funding goes to areas that face the highest costs.
Union reaction
Dr Mary Bousted, general secretary of the Association of Teachers and Lecturers (ATL), said, ‘A new national funding formula for schools must prioritise pupils with the greatest needs and this does not necessarily mean every school should be given the same funding.
‘ATL is yet to be convinced that the Government can deliver a new funding formula which will help all children reach their potential regardless of where they live in the country. A new funding formula must prioritise the most deprived areas rather than be based on pleasing politicians who want their schools to have the same cut of the pie no matter how well-off or high achieving their area may be.’
She added that the Government had not left enough time for for the new formulae to be confirmed to enable schools to begin to plan for next year, and that schools’ budgets have already been cut in real terms by 8 per cent, with schools struggling to cope with teacher shortages and higher pupil numbers.
‘We caution David Cameron and Nicky Morgan about reducing the role of local authorities in school funding. The Government has already struggled to manage the huge centralisation of the academies programme, which has taken power and supervision of education away from local communities, and the Department for Education does not have a good track record managing its own accounts,’ Dr Bousted said.
The GMB union, which represents school support staff, said that there would inevitably lead to winners and losers, with many pupils and schools in London and other inner city areas set to lose out.
Karen Leonard, GMB regional organiser, said, ‘GMB remains unconvinced that removing democratically elected local authorities from the funding process is anything other than a further move towards the privatisation of our school system.’
Both consultations closes on 17 April.