Delay to new funding formula could prove ‘catastrophic’ for most cash-strapped schools, heads warn

Some schools will be ‘in danger of financial collapse’, ASCL warns

The one-year delay to the new funding formula could be “catastrophic” for some of the most cash-strapped schools unless they are given some form of interim support, heads’ leaders said today.

Julia Harnden, funding specialist at the Association of School and College Leaders, said her organization was “extremely disappointed” no support had been put in place for the lowest-funded schools in the lowest-funded areas.

She said: “The financial situation in these schools is already critical because of huge increased cost pressures and the delay in the introduction of the new funding formula is potentially catastrophic”.

The situation would mean that some schools were ‘in danger of financial collapse’, despite good leadership, she said.

Her comments were backed by Russell Hobby, general secretary of school leaders’ union NAHT, who said that the announcement of the delay to the new formula from 2017-18 until 2018-19 “will disappoint many school leaders”.

Ms Harnden said: “While we understand the government’s reasons for delaying the introduction of a new funding formula, we are extremely disappointed that no interim support has been put in place for the lowest-funded schools in the lowest-funded areas.

“The financial situation in these schools is already critical because of huge increased cost pressures and the delay in the introduction of the new funding formula is potentially catastrophic.

“Additional financial support must be put in in place for 2017/18 for these schools and the government has to understand the urgency of this situation. Through no fault of their own, and despite exemplary leadership, some schools are in danger of financial collapse.”

Mr Hobby added: “We know from the Institute for Fiscal Studies’ analysis that budgets will see a real terms cut of 8 per cent between now and 2020; flat budgets are not taking account of rising costs, regardless of the distribution of funding”.

But he acknowledged that it was now “too late” to introduce changes for 2017-18, as the government had previously planned.

“Schools need certainty above all else, and today’s news that the formula will not begin until 2018-19 at least provides a little clarity on when the funding system will be reformed,” he said.

Education secretary Justine Greening said today that she would publish details of the proposed new formula this autumn, and bring in the new system for 2018-19. She said a “minimum funding guarantee” that prevented schools from losing more than 1.5 per cent of their funding per year would remain in place.

Mr Hobby said this guarantee did not go far enough. “We need more money, rather than a guarantee that we won’t lose a lot,” he said.

“We would press the government to ensure that the most poorly funded schools actually receive more during this transition period.”

Jonathan Simons, head of education at the think tank Policy Exchange, told TES the one-year delay to the formula was “the right thing to do, under the circumstances.”

He said: “The delay caused by various elections and the referendum and subsequent political changes meant that the timing would have been unreasonably tight. [It’s] better to do it right, than do it in a rush.”

Ms Greening faced questions on the delay in the House of Commons this morning. Shadow education secretary Angela Rayner said the “last-minute” move summed up the government’s “woeful” attitude to school funding.

Ms Greening told MPs: “What we want to do is strike a balance between moving rapidly towards a fairer funding formula but at the same time making sure that we do that in a way that clearly allows time for the details of that formula to be debated because they will have a big impact on how it works effectively.

“But also then time for local authorities to understand the changes and then prepare and indeed for schools themselves as well.

“That’s the balance I have tried to strike today and I also want to be responsible in making sure that we don’t rush into some changes without absolutely being fully sighted on the ramifications of them.”

Ms Greening said she was “committed to resolving” the issue but that she wanted to “make sure … we resolve it effectively so that we don’t have to revisit this funding formula again because we haven’t got it right first time”.

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