Finding the Formula - UK | Zurich Insurance .Finding the Formula A comprehensive guide to school

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Transcript of Finding the Formula - UK | Zurich Insurance .Finding the Formula A comprehensive guide to school

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    F i n d i n g t h e Fo r m u l aA c o m p r e h e n s i v e g u i d e to s c h o o l f u n d i n g

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    t h e t r u e c o st o f t h e f u n d i n g c r i s i s

    T he school funding system is messy and unfair and for decades politicians have promised to fix it.At the moment, Englands schools have a

    patchwork funding system thats overseen by local authorities (LAs). The amount different areas receive is skewed by an out-of-date and over complicated system, with some areas of the country receiving thousands of pounds more per pupil than others.

    To solve this, the government has promised to create a new national funding formula for schools. This will remove variations between areas and ensure all pupils are treated fairly.

    It sounds like good news. Except, as this supplement will explore, its not that straightforward.

    While some schools are set to gain money under a new system, others mostly those in the inner cities are expecting to lose cash. No one knows how much theyll lose, or how theyll be helped to transition to the new funding arrangements. Headteachers are operating in limbo.

    Just a week after Justine Greening was appointed education secretary in mid-July, she announced a delay to the funding overhaul, which has been pushed back to 2018. For headteachers working in the worst-funded areas who are desperate for reform this was a huge blow. Many warn they are already at breaking point. They have cut staff and subjects from the curriculum, theyre operating in run-down buildings. They say their situation is untenable.

    To make matters worse, all this is taking place at a time when schools are facing a perfect storm of falling real-term funding and rising costs.

    In this supplement well be exploring what a new funding formula could look like. Well be examining which areas of the country are the best and worst funded, and profiling how school leaders whether theyre part of an academy trust or a LA are making ends meet. Well also be examining the spiralling costs facing headteachers. And well be hearing what factors they hope the government will recognise when designing a new formula.

    Plus, to help you get your head around the funding changes, we have a timeline of key milestones, and a Q&A guide to all theproposals.

    Rebecca Ratcliffe

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    Helping schools make the most of the pupil premium


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    c o n t e n ts

    Timeline of a funding crisis

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    opinion Heads hopes for the new funding formula

    How school funding works q&a

    what factors will decide how much a school gets?

    preparations for the new funding formula



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    How well funded is your school?

    this content has been supported by Zurich municipal (whose brand it displays). all content is editorially independent. For more on this subject, visit:

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    How does funding make its way from government to schools?Its a three-step process. First, the government decides how much education funding there should be nationally (for schools, for pupils with high needs, and early years) as part of the spending review.

    The government uses a formula to allocate that money among those three categories, or blocks nationally. It then distributes money from each block to local authorities (LAs). Importantly, money is doled out on a per-pupil basis, and the allocation is based almost entirely on what they were given last year (this is known as spend plus, and is the reason why different LAs continue to get different amounts per pupil). Lastly and confusingly LAs then apply their own local formulae to amend the amount they give to each school in their area, and keep a small amount back to fund their own services.

    Academies are funded differently because their money comes directly from central government. But the base amount they get is equal to the per-pupil amount for maintained schools in their local area. They also receive a top up to pay for services which maintained schools receive for free from their LA.

    Whats happening to school funding?The formula thats used to decide how much funding schools receive is out-of-date and unfair. At the moment, Rotherham and Plymouth have the same proportion of pupils eligible for free school meals (FSM), yet Rotherham receives nearly 500 more per pupil.

    The government has promised to overhaul this system. In March, it launched a consultation proposing a national funding formula.

    Why is the current system so unfair?Before 2006-07, all school funding was decided entirely by LAs some of whom, especially in urban areas, spent more than others. From 2007, the Labour government introduced a Dedicated Schools Grant (DSG), which guaranteed that education funding allocated by government would be spent on schools. But the DSG worked by guaranteeing the existing, variable, level of per-pupil funding in each authority, and then adding more money on every year (spend plus). So, it has locked into place these historic variations in spending. To make matters worse, as the demographics of areas changed over time, the funding didnt move to take account for it.

    Why is it so hard to develop a new formula?Designing a new funding formula is actually easy. It is, technically, quite straightforward to calculate how much it costs to educate a typical pupil and the extra costs associated with certain circumstances.

    The real problem is all stakeholders agreeing to enact this formula, given the impact it will have on schools.

    So whats the problem? Some schools will lose out? Which type of schools?In a nutshell, if some schools are under funded (receiving less money per pupil than a national formula calculates they should have), and theres little or no extra money available, then the only way they can receive more is if the over funded schools lose out. This, unsurprisingly, goes down badly with such schools (and MPs).

    At the moment its London that receives the most, and rural shire counties that get the least. So, in general, wed expect to see a shift away from London to the counties. But its a complex picture. Not all schools in high-funded areas will lose and not all in low-funded areas will gain a national formula will calculate the individual schools need, and not just the area in which theyre based.

    W h y i s o u r s c h o o l f u n d i n g syst e m s o c o m p l i cat e d ?S c h o o l f u n d i n g i s u n f a i r, b u t u s e o f a n a t i o n a l f o r m u l a m a y a d d r e ss t h e p r o b l e m

    A n At i o n A l fo r m u l A w i l l cA lc u l At e t h e i n d i v i d uA l s c h o o l s n e e d

    Jonathan Simons head of education at think tank Policy Exchange

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    teachers, is that school funding has simply not kept pace with inflation.

    Research from the Institute of Fiscal Studies shows that while the Conservative government has protected day-to-day spending per pupil in cash terms for the current parliament, rising costs and an increase in pupil numbers have squeezed resources. In real terms, the institute says, spending per pupil is likely to fall by 8% over five years.

    The major factors are ones affecting all schools, from early years providers through to sixth-form colleges: an increase in employers contributions to the teachers pension scheme from April 2015, an average public sector pay rise of 1% per year announced in summer 2015 and an increase in employers national insurance contributions from April 2016.

    At George Greens, that added up to a total bill of 600,000 this year, half of which was saved through staff job cuts. More savings have had to be made by merging faculties and by cutting planned building works, and almost 20 staff have agreed to work for less money.

    As a head teacher I found it incredibly

    i fo u n d i t i n c r e d i b ly pa i n f u l to say : i m g o i n g to h av e to m a k e m a n y o f yo u r e d u n da n t

    t he end of this years summer term was a difficult time for staff at George Greens school, on Londons Isle of Dogs. Wed never had so many goodbye speeches it was heartbreaking, says the 1,200-pupil secondary schools principal, Jill Baker.

    Amid tightening budgets, the school was forced to cut 30 support staff roles this year out of a total of 100 18 of those through redundancies.

    And George Greens is not alone. Across the country, headteachers are complaining that they cant make ends meet. Headlines have screamed of cuts, redundancies and deficits, and in some areas teachers have threatened to strike.

    At times of austerity, budgets are bound to be difficult for schools. But last autumns spending review seemed to provide some comfort for heads and teachers.

    Not only is the schools budget protected in real terms, but the total financial support for education, including childcare and our extended further and higher education loans, will increase by 10bn, the then chancellor, George Osborne, told MPs.

    But the reality, it seems, is rather different from the political rhetoric. And the recent experience of George Greens can provide some answers as to why that is.

    The schools pupils, aged 11-19, have a huge range of problems almost eight out of 10 take free school meals; theres a family therapist and a safeguarding team on site and a significant proportion have