Westminster Hall debate on School Funding (London) - March 29

Helen Hayes (Dulwich and West Norwood) (Lab) 

I beg to move,

That this House has considered schools funding in London.

It is a pleasure to serve under your chairmanship, Mr Hanson. I am pleased to have secured this debate so that Members can highlight the specific impacts that the proposed national funding formula will have on London schools. I am grateful to the Minister for meeting me last week, together with my hon. Friend the Member for Bermondsey and Old Southwark (Neil Coyle), my right hon. and learned Friend the Member for Camberwell and Peckham (Ms Harman) and the leader of Southwark Council, to discuss the challenges that schools in Southwark and Lambeth will face as a consequence of the national funding formula proposals.

Since I was elected almost two years ago, there have been only a handful of issues on which my constituents feel as strongly as they do about the schools funding formula, and few issues around which people have mobilised on such a large scale. In the past few weeks, I have attended meetings in Lambeth and Southwark with a total of more than 500 parents. A further 100 parents and children joined a protest in Dulwich last week, and hundreds more have been in touch with me by email and letter and on social media. I want to speak about the impact the Government’s proposals will have, what exactly is at stake and why it matters so much. I have some specific asks to make of the Minister.

The new national funding formula will see 70% of London’s schools receiving cuts to funding. The proposal comes at a time of unprecedented budget pressures in our schools as a consequence of a series of unfunded costs: the national minimum wage increase; employers’ pension contributions; employers’ national insurance contributions; inflation; and, for local authority schools only, the apprenticeship levy. In that context, the additional cuts introduced by the schools funding formula will be unsustainable for many schools in London. London Councils calculates that the combined impact of introducing the national funding formula at a time of wider budgetary pressure means that collectively, London schools will lose £360 million in 2018-19.

The Conservative manifesto pledged that the funding accompanying every pupil into school would be protected, but the National Audit Office is clear that per-pupil funding has not been protected in real terms. In London, the proposed national funding formula will clearly break that pledge further. The cuts will not fall evenly but will fall disproportionately on areas of London with the highest levels of deprivation. Therefore, while Croydon Central will gain £4.4 million for its schools, West Ham stands to lose £4.4 million, East Ham loses £3.6 million and Bethnal Green and Bow loses £3.5 million.

Stephen Timms (East Ham) (Lab) 

I am grateful to my hon. Friend for highlighting the scale of the cuts in my constituency and the scale of the concern among my constituents about that. I have had letters from lots of teachers at Central Park Primary School about the £710,208 being taken out of its budget. Does she agree that that is quite wrong?

Helen Hayes 

I agree with my right hon. Friend entirely. The level of pressure our schools are being asked to bear would be unacceptable in any circumstances, but in order to understand exactly how damaging the proposals are, and why parents in my constituency and across London feel so strongly about them, the Government must understand the journey that London schools have travelled in the 14 years since the Labour Government introduced the London challenge programme of improvement for London schools in 2003.

I moved to London in 1996. At that time, parents in the same situation as I am in now, with their oldest child approaching secondary school age, were often trying to do one of three things: move close to a high-performing state or church school; move out of London to a part of the country where schools were better; or educate their children privately. Children whose parents were unable to make any of those choices often attended local schools, which despite the best efforts of their teachers substantially failed generations of children. In my constituency at that time, we had William Penn boys’ school and Kingsdale school, both of which were failing schools that became notorious. William Penn subsequently closed and successfully re-opened as the co-educational Charter School, and Kingsdale was completely remodelled under a change of leadership. Those are now outstanding and good schools respectively.

I have spoken with many parents in my constituency who attended failing schools as children. They remember the crumbling buildings, leaky roofs, shortages of books and materials, very large class sizes and poor discipline. They tell me that any success in their educational outcomes was due to the hard work that they and their teachers put in and happened despite, not because of, the funding and policy environment in which the schools were operating.

The situation could not be more different across London now: 94% of London schools have been judged to be good or outstanding by Ofsted. While London schools were the worst in the country in the 1980s and 1990s, they are now the best. That transformation was achieved through a combination of political leadership, appropriate resourcing, stringent accountability and—most importantly—the hard work of teachers, governors, support staff and parents. I think I speak for all London MPs from across the House when I say that we are deeply proud of our schools and everything they deliver for London children.

Our schools in London deliver for every child. They are not reliant on selection, and as a consequence London children also benefit from being educated in a diverse environment, which helps to build understanding and community cohesion. My children are receiving an excellent education alongside children from every possible walk of life, and their lives are enriched as a consequence. It is that approach, not grammar schools, that delivers the social mobility the Government say they want to see.

London schools are the best in the country, despite having the most complexity among their intake. They have the highest levels of students with English as an additional language, special educational needs and children from deprived households, and they have very high levels of churn, in part due to the large numbers of families now living in the private rented sector, who often have to move when short-term tenancies come to an end.

London schools are able to deliver in that context when they have the teaching and support staff to provide the help and support that every child needs, so that those who need extra help in the classroom can receive it, those who need to be stretched more to fulfil their potential can thrive, and a rich, imaginative curriculum can be offered to all students. The headteachers in my constituency increasingly talk about the new challenges their students face. Chief among them are mental health issues, which are growing in part as a consequence of the pressures children face on social media. They feel the need for additional support in school that students can access, but they are already unable to afford that.

I wrote to every headteacher in my constituency to ask about the impact that they anticipate the national funding formula will have on their school. I want to share just two examples of their feedback today. A primary head wrote to me and said,

“in order to balance the budget this year we had to lose six members of staff. Prior to this academic year we employed one Teaching Assistant per class. This year we have a Teaching Assistant per year group. I can see a time when schools will not be able to afford Teaching Assistants at all. Our building is shabby because we cannot spare the funds to redecorate and carry out minor repairs. Cuts in funding will mean that Headteachers will become more and more reluctant to accept pupils that put a strain on the budget.”

The Minister for School Standards (Mr Nick Gibb) 

I am listening carefully to the hon. Lady and, as I did at the meeting with her and her colleagues, I have paid careful attention to what she is arguing. Is she interested in knowing that in Lambeth, under the new national funding formula, the funding per pupil is £6,199 and in Southwark it is £6,271, whereas in Waltham Forest it is £5,129 and in Surrey it is £4,329? It is that discrepancy that the national funding formula tries to go some way to dealing with.

Helen Hayes 

I thank the Minister for his intervention. If he bears with me a little longer, he will hear that I am not arguing that schools elsewhere in the country—or indeed in outer London—should lose out as a consequence of the funding formula; what I am interested in is a funding formula that is fair for all schools.

A secondary headteacher wrote to me and said:

“Effectively our budgeting will be reduced by £500,000 in real terms in the next three years...it will make it very difficult for us to continue to provide a high quality education for our students, and will undoubtedly affect our ability to support student achievement and wellbeing. It will also have a negative impact on the workload of our staff who already work incredibly hard day in day out to support our students.”

Those are experienced headteachers, looking at a spreadsheet in the cold light of day and working out the choices they will have to make to accommodate the Government’s funding cuts.

Paul Scully (Sutton and Cheam) (Con) 

To clarify, are not many of the pressures the hon. Lady talks about, which I certainly do not dismiss, the associated costs, rather than necessarily to do with the funding formula itself?

Helen Hayes 

My argument is about the cumulative impact of unfunded cost pressures in recent years, and some still to come because of the apprenticeship levy, in addition to the impact that the new funding formula will have.

Seventy per cent. of schools’ budgets are spent on staff, so it will be teaching assistants, speech and language therapists, learning mentors, family support workers, school trips, sports clubs, music specialists and teachers that will have to be cut. Heads across my constituency say that the formula does not work. London schools also face a recruitment crisis, fuelled by the high cost of housing and childcare in the capital, as well as the Government’s failure to meet teacher training targets. More than 50% of London heads are over the age of 50, and the current budgetary pressures, combined with the new inspection regime and changes in the curriculum, are making it harder and harder to recruit. Further reductions in funding will only exacerbate the situation, making it harder for schools to retain experienced teachers and creating a level of pressure in the profession that will cause many hard-working teachers to look elsewhere.

The Government’s stated aim in revising the schools funding formula is fairness. I agree with that aim. There are problems with the current formula in some parts of the country, because of the embedding of resourcing decisions made by local authorities many years ago and their use as the basis for calculating future increases. However, there is nothing fair about a proposal under which funding will be cut from high-performing schools in deprived areas. A fair approach would take the best-performing areas in the country and apply the lessons from those schools everywhere. It would look objectively at the level of funding required to deliver in the best-performing schools, particularly in areas of high deprivation, and use that as the basis for a formula to be applied across the whole country.

London schools should be the blueprint for education across the whole UK, but school leaders in London are absolutely clear that quality will inevitably suffer as a consequence of the funding changes that the Government are implementing. It is simply irresponsible for the Government to put the quality of education in London at risk. Children are growing up in a time of great global change and uncertainty. We feel that today perhaps more than ever, as article 50 is triggered. They need to be equipped with the knowledge, skills and confidence to navigate and compete in a post-Brexit economy. Our schools are essential to that, and to ensuring that children make the maximum possible contribution to the economy and public services in the future.

I ask the Minister this morning to think again and, as he reviews the 20,000 consultation responses that have been submitted, to consider the impact that the changes will have on London schools. I have two specific asks. When I met the Minister last week, it was not clear from what he said that he had recently visited high-performing London schools, so I invite him to visit a primary school and secondary school in my constituency to see at first hand the great work that our local schools do and to understand the current financial pressures that they face.

Mr Gibb 

I visit high-performing London schools all the time. Most recently I have visited Michaela Community School in Wembley and St Michael’s Church of England School just south of the river in Battersea.

Helen Hayes 

I thank the Minister; I would dearly love to welcome him to high-performing schools in my constituency, so that he can hear at first hand about the pressures that headteachers are talking about.

Secondly, I ask the Minister to go back to the Treasury and to negotiate again. Spending on schools is an investment that the Government make in the future of our economy. It would take just 1% of the education budget to ensure that no school loses out through the introduction of the national funding formula. I ask him please to think again and not to put the success of London schools and their ability to deliver for future generations of London children at risk.

Mr David Hanson (in the Chair) 

As Members can see, a number of right hon. and hon. Members want to participate in the debate. I intend to call the Front-Bench spokesmen at 10.35. I hope that Members will show self-restraint so that everybody is able to take part.

Paul Scully (Sutton and Cheam) (Con) 

It is a pleasure to serve under your chairmanship, Mr Hanson. I shall be brief in making a few points about how the costs—and the associated cost pressures that I mentioned in my intervention—affect schools in Sutton.

All hon. Members welcome the opportunity to get fairer school funding. It has been debated at great length in the House over the past few months, with good reason. It is not fair that pupils with similar needs do not benefit from the same funding, and that that depends on where they live. It is right and proper to look at the issue, but that has not happened for a long time because it has been politically difficult. I welcome the fact that it is happening now. The consultation has just finished, and I am sure the Minister will look at the representations made in the responses and present any changes that he feels are appropriate for us to debate further.

Secondary schools in Sutton receive greater funding from the formula, by about 1.4%. Primary schools lose by 0.5%. However, as was mentioned before, many of the issues that headteachers are dealing with at the moment and that they will face going forward are associated cost pressures. With all the changes being made, now is an apt time to consider them.

There is a lot of concern among headteachers—all the headteachers in the area have written to me and the right hon. Member for Carshalton and Wallington (Tom Brake). Some headteachers from the London Borough of Sutton have already met the Minister for discussions. They are concerned about such things as the apprenticeship levy, which affects only some secondary schools and is comparatively low when set against the effects of some of the other changes and pressures. However, I find it strange and puzzling when any public sector institution’s money is churned around, as happens when we give a school funding and then claw some back through levies, rates and such things. I would find it easier if we cut through the bureaucracy and paid schools the money they needed to spend on their pupils.

Schools are not really well placed, especially at the moment, to take on apprentices because they are already training centres—they already train newly qualified teachers, Teach First teachers and other student teachers. Where they might be able to take on apprentices, such as in administration, things have already been cut to the bone, because those are in many ways the first places where cuts can be sought. It then becomes difficult to send anyone out on day release. I have a lot of sympathy with headteachers about the apprenticeship levy.

Many headteachers have talked to me about the 1% salary increase for public sector workers. They say that they want to be able to pay teachers more but, without the requisite funding, doing so would effectively mean an extra 1% cut in their budgets. They are not attracting more funding from the centre to pay for it. Again, I understand their concern. A signal is being sent, and it is pushed on to the headteachers to say, “Sorry. I can’t pay you any extra this year because of budget constraints”—despite the mood music in the media about pressure to pay people the extra 1%.

Another headteacher mentioned the cost of recruitment. It is difficult to get teachers, and especially senior teachers. I have been a governor for many years. When I was the chairman of governors at a primary school, we were looking for a headteacher and put many adverts in The Times Educational Supplement. It cost thousands of pounds each time and the response was woeful. I am interested in whether the Minister would consider a centralised recruitment system that everyone could tap into—one source that teachers can use—which would be a great cost saving for schools. The Department has talked about being able to make savings in schools through such things as procurement. It would be great if the Department could help schools by taking that approach.

I talked about the fact that secondary schools are a net gainer and primary schools a net loser. One reason they are all losing is the local authority formula. The local authority in Sutton has caused two issues. First, it had built up a surplus in the part of the grant it left behind, which has been used over the last few years to cushion some of the pressures. The surplus has now been used up and has finally come to an end. That has not been communicated particularly well to the schools, so there is a little bit of a cliff edge this year. On top of that, the local authority has effectively made a 0.5% cut for many schools to the amount it is keeping back, rejigging and then handing out to them.

Whereas the national formula helps us out a lot, the local formula means that Sutton loses out. It is important that parents and headteachers know exactly where the blockages are. In these times of greater devolution, it is important that the right people are accountable for formulae. I ask parents and headteachers to ensure that they question the local education authority and hold their councillors to account, including the council leader in Sutton, on why that money is being held back.

There is a disparity in Sutton between some of our secondary schools of about £1,000 per pupil—some get £4,500 while others get £5,500 per pupil. We have a number of grammar schools, with six fully and partially selective schools in Sutton. I question the argument about a lack of social mobility. There is a good amount of social mobility in those schools, primarily for Asian communities. We have a big Tamil community and a Bangladeshi community.

Helen Hayes 

The issue with grammar schools is not what they deliver for the children who are able to access a place there. The evidence across the country shows that children from deprived backgrounds who do not go to grammar schools in areas that have them do demonstrably worse in their education. That is the issue of fairness I was referring to.

Paul Scully 

That is an interesting intervention, but I can only use the Sutton example. All our schools are excellent, including the ones that are not selective. Indeed, Stanley Park High School in Carshalton and Wallington won The Times Educational Supplement secondary school of the year award last year. All the schools are being brought up in Sutton. A lot of Tamil and Indian families are moving around to be able to access Sutton’s schools. The problem in Sutton is ensuring that white working-class people can get that social mobility. We need to work harder on that.

My final point is that the funding pressures on the grammar schools are such that they are getting considerably less pupil premium per pupil than those in other areas, despite some of them being in average deprivation, because they are in more affluent areas. They are being disadvantaged because of the fixed costs—buildings cost a lot to heat and light, and there are staffing costs. They are losing out to other schools, which are getting pupil premium on top.

I make a special plea to the Minister to consider some of the work being done by grammar schools. Essentially, the funding formula is fair. It is good we are addressing this issue. I would like the Minister to have a look at some of the associated cost pressures and to answer some of the questions that headteachers have raised with me.

Jim Fitzpatrick (Poplar and Limehouse) (Lab) 

It is a pleasure to see you presiding over us this morning, Mr Hanson. I am not sure I have had the privilege of serving under your chairmanship before. I congratulate my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) on securing this debate and commend her for her excellent speech, which detailed the problems we all face.

I do not have a long record of speaking in education debates over the years. As the Minister knows, my main engagement with his Department has been about fire sprinklers in schools and trying to improve the guidance on their installation. We have not cracked that yet. However, I have been contacted by a number of primary school heads in my constituency. Their comments need to be registered not only with me but by me in this debate. I will do so briefly, in line with your request, Mr Hanson. I have also written to the Secretary of State.

Heads from Cubitt Town Junior School, Mayflower Primary School, Cyril Jackson Primary School, Lansbury Lawrence Primary School, Arnhem Wharf Primary and St Peter’s London Docks Primary School, as well as constituents, have contacted me on this issue. One letter said:

“the national funding formula has the potential to make school funding fairer, but it will fall short unless it is given sufficient resources to succeed. School budgets are being pushed beyond breaking point.”

That brief quote says a lot. Given the pressures faced by schools, the writer of the letter is still able to see the positives in the funding formula, but refers to how it is let down by the sheer lack of resources. In her letter to me, the headteacher of Cyril Jackson Primary School listed 12 ways in which the school was forced to act to reduce overheads in 2015-16, meaning reduced staff numbers, less guidance, less encouragement and fewer opportunities to see new things, and experience other environments and be inspired by them.

My hon. Friend the Member for Dulwich and West Norwood has previously said, and may have said again this morning:

“The government is putting our excellent local schools at risk, with a change in the funding formula which will see money taken away from our local schools to give to schools in other parts of the country.”

Neither I nor any other colleague, I am sure, would wish to see schools in other parts of the UK short-changed, but giving them what they need to deliver a great education service should not be at the expense of London schools. Children everywhere should have and must enjoy an equally high standard of education. Whether they live in Dulwich, Docklands, Dudley or Droitwich, children deserve well-funded schools that enable them to reach their potential. It is as simple as that.

Those on the ground are telling me that school budgets are being pushed beyond breaking point. One of our local representatives in Tower Hamlets, Councillor Danny Hassell, recently tweeted that he had just seconded a Labour motion at the council against Government plans to cut funding in our schools that will mean a staggering loss of £511 per pupil in Tower Hamlets. Children such as those at Cubitt Town Junior School cannot afford the Government’s proposals. Their headteacher tells me it is calculated that Cubitt Town pupils will lose up to £746 per pupil.

Mr Gibb 

I am listening carefully to the hon. Gentleman. Does he acknowledge that Tower Hamlets was the highest funded local authority in the country on a per-pupil basis before the national funding formula and remains so, even after the national funding formula is implemented, with funding of £6,718 per pupil, compared with £4,329 in Surrey and £5,129 in Waltham Forest?

Jim Fitzpatrick 

I am grateful to the Minister for quoting those statistics. I was quoting one myself from the headteacher of Cubitt Town Junior School, who said that Cubitt Town pupils will lose up to £746 per pupil. I do not doubt that Tower Hamlets’ schools are well resourced and well funded by the Government, but the cuts being introduced will be unsustainable. The headteacher says that it could mean the school losing up to six teachers. How will that Isle of Dogs school withstand such a reduction without significant negative consequences for the quality of education it can give to local children?

Along with parliamentary colleagues, I urge the Government to acknowledge that their funding plans do not work for Cubitt Town, for the other schools I have mentioned or for all those left unmentioned. They certainly do not work for Tower Hamlets.

Mr David Burrowes (Enfield, Southgate) (Con) 

It is a pleasure to take part in this vital debate. I congratulate the hon. Member for Dulwich and West Norwood (Helen Hayes) on securing it. Members from both sides of the House are present. That is important, because this is a cross-party issue that cannot be monopolised by any one party. It matters to us all because it matters to children in our constituencies and their life chances.

I am grateful to the Minister. He is one of the most patient Ministers and, indeed, one of the longest-standing Education Ministers. No one can preach to him about schools. He has been out there visiting schools across the country. He may be patient, but he is intolerant in the sense that he does not tolerate educational failure, wherever it comes from, particularly for disadvantaged pupils. He has been a Minister on a mission, both in the Department and on his sabbatical—we could not do without him, so he came back. The Minister’s mission, which is shared by the Department for Education, is:

“to deliver educational excellence everywhere, so that every child and young person can access world class provision, achieving to the best of his or her ability regardless of location, prior attainment and background.”

We all want to achieve that aim. That is what the debate about the national funding formula and schools’ overall budgets is about. That is what we want to achieve. Like other hon. Members, I am a governor, at two schools. I am also a parent and I care passionately about the Government achieving what is very much this Minister’s mission.

London is a success story as a result of that mission. The Government should be proud, along with the previous Government in terms of funding, of what they have achieved. They have ensured that 92% of schools across London are good or outstanding. We pay tribute to the teachers, governors, parents and pupils for being very much part of that success story. Particularly relevant is the fact that disadvantaged pupils are progressing better in London than elsewhere in the country. We want to ensure that others are lifted up to that standard. That means being lifted up in funding as well, and that is what the national funding formula is about.

I recognise that the Government have a position. We can spend our time—I do not want to spend too much time, Mr Hanson—defending manifesto commitments, and we can dance on the head of a pin about how much extra money there is per pupil, or we can make the point, as I am sure the Minister will, that more is being spent than ever before, in cash terms. The figure is £40 billion a year. We also have to recognise the context, which is our national debt; interestingly, that is £40 billion a year as well. That is important context for the restraint that all public services are facing.

I have been ready to defend the reality that the Department for Education budget and the schools budgets are not immune from that restraint. They have already had to make significant decisions and cuts in school budgets. However, we are in a position in which schools have already been vulnerable. Before the national funding formula, we could have had a debate about school funding and cuts in my local schools and others. However, we now have the national funding formula. Many of us, particularly in outer London, were hopeful that that would lead to a significant rebalancing of funding. For those of us in outer London, there has been an impact not just in relation to school funding. Local government has historically been underfunded. There is a need to recognise the demographics—the population increases—in outer London. Mental health funding is also relevant. The right hon. Member for Tottenham (Mr Lammy) will join me in making this point. There has been 25% less funding in parts of London such as Camden. All of that impacts on schools, so we were looking to the national funding formula in particular to see us through these difficult and challenging times.

I recognise that the Government are right on the principle. This is perhaps where this funding formula debate will differ from others to which the Minister has patiently listened. We need to retain recognition of deprivation. That needs to be reflected, and it is: 18.1% of the schools budget is for additional needs, based on low attainment, deprivation and English as an additional language. That is so important and it must stay. It must not in any way be diluted or reduced; in fact, some of us say that it should be increased. It should be good news for Enfield and other parts of London that are particularly impacted by those additional costs. It is also right there is flexibility; that is good news as well.

There is an issue about deprivation. I ask the Minister to reflect on the concerns in that regard. I am thinking of free school meals and the income deprivation affecting children index. Is what is happening truly reflective of the challenges facing children in families who may well be on universal credit and who may be in work, but who could well still be in poverty and in challenging situations? There is concern that the drop-off in free school meals is impacted by the benefit changes and that that is not leading to a proper settlement, a proper reflection of people’s needs.

Enfield does better than other parts of London, and it should do, but it does not do well enough—the Minister may have been expecting me to say that. My constituency may get £400,000 more in cash terms, but the reality is that 15 out of 22 schools will lose out. The reality as far as budgets and the real costs are concerned is that there will be £3 million of cuts in Enfield, Southgate by 2018-19. There is also an impact from the apprenticeship levy, national insurance contributions, pensions and pay.

That matters greatly to schools such as West Gove Primary School, which have significant additional needs. Just over the weekend, I got another 280 petition letters, all of which I have here. Never before has there been such interest and concern among parents. At West Grove, they are concerned about a cut of £276,572 over the next four years. Hazelwood Infant and Junior School faces a cut of £150,000 over that period. It says that that equates to eight teachers. We have dealt with challenging budgets before, but there is now an impact on the budgets for teachers. That is affecting particularly primary schools. A particular issue is the high cost of recruitment and retention.

The principle behind the national funding formula is sound. I do not want us to go backwards. We need to be bold and continue with that, but we need to recognise that eventually it has to mean adequate provision, proper provision, for additional costs. I will defend the principle, but I will not defend the reality of the cuts that will come through for the budgets of my local schools. In fact, I join the Minister in this intolerance: I will not tolerate that, because it will impact particularly on disadvantaged pupils. When we get to the autumn Budget, I will want to see, to help the Minister, a bigger pot so that we can help schools in other areas and ensure that there is fairer funding, and ensure that London continues to be the success that it deserves to be and is not a victim of its success.

Mr David Hanson (in the Chair) 

Order. We have 30 minutes before the winding-up speeches, and six Members. That means five minutes each, if people can exercise self-restraint.

Siobhain McDonagh (Mitcham and Morden) (Lab) 

I congratulate my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) on her brilliant exposition of the issues currently facing London schools.

In May, I will have been the MP for Mitcham and Morden—the place of my birth—for 20 years. One of the biggest and most satisfying things during those 20 years has been seeing the blooming of our schools. Schools that were universally performing so poorly have been transformed into schools that, in the main, although not exclusively, are doing really well. School buildings are now places that people would want to enter, rather than fearing to enter. I want to see that continue, and I want to see that mostly for those who have least. What concerns me is the number of teachers who come and see me at my Friday advice surgery from schools where children are in temporary accommodation and finding it difficult to get to school. As has been mentioned, more children than ever suffer from mental health problems and are self-harming. These demands on schools at this time make it difficult for them to cope from where they are, let alone if they lose any funds at all.

Mr Gibb 

Let me gently point out to the hon. Lady that 96.2% of the schools in her constituency, Mitcham and Morden, gain funding under the new national funding formula. That amounts to a 6.6% increase once the formula is fully implemented, and that is £3.5 million. Schools should not be coming to the hon. Lady to talk about cuts in funding, because 96% of her local schools will see an increase in funding under this formula.

Siobhain McDonagh 

I invite the Minister to come to William Morris Primary School, in Pollards Hill, which is going to lose £487 per pupil, which is the equivalent of four teachers, or to Singlegate Primary School, which will lose £424 per pupil; or perhaps he would like to go to Morden.

Mr Gibb 

Again, the hon. Lady takes the misleading figures from the National Union of Teachers, which is conflating the cost pressures that all of the public sector is incurring over this year and the next three years—amounting to 8% in total—with the national funding formula. The national funding formula is good for schools in the hon. Lady’s constituency. I hope very much that her local headteachers and she herself will support the new national funding formula, because it is fairer, and fairer for her schools.

Mr David Hanson (in the Chair) 

Order. I call Siobhain McDonagh.

Siobhain McDonagh 

I am sure that, when a bill has to be paid, the headteacher is not looking for the reason why it is becoming more difficult for them to do that. Certainly—

Mike Kane (Wythenshawe and Sale East) (Lab) 

I am sorry to interrupt my hon. Friend, who is making a fantastic speech. The Minister has interrupted hon. Members a number of times. The figures that he talks about, from the Association of Teachers and Lecturers, the NUT and the National Association of Head Teachers websites, come from the figures from the Department and the National Audit Office, so the figures are as accurate as they can be from Government statistics. The Minister should stop interrupting Members who are standing up for schools in their constituency.

Siobhain McDonagh 

I thank my hon. Friend for his intervention, but I am delighted that the Minister is intervening on us, because he needs to understand what schools are finding and experiencing. I know from my long awareness of his work that this cannot be a pleasant thing for him to be doing. He needs to understand—I am sure he does—the effect on the schools that are the most vulnerable and hang on to their improvement with all their might.

That brings me to a school that we both appreciate—Harris Academy Merton. It has had a 70% pass rate for five A to C GCSEs in the last year and will lose £298 per student. St Mark’s Academy will lose £291 per student. These schools cannot afford to lose money. They need the Government’s help, not the Government’s debate.

James Berry (Kingston and Surbiton) (Con) 

It is a pleasure to serve under your chairmanship, Mr Hanson, and to follow the hon. Member for Mitcham and Morden (Siobhain McDonagh). I congratulate the hon. Member for Dulwich and West Norwood (Helen Hayes) on securing this excellent debate.

My parents are teachers, and I have had the pleasure of visiting every school in my constituency at least once. We have the best schools in the UK in terms of the proportion of good or outstanding schools and GCSE and A-level results, and we also have grammar schools. They suffer the same pressures as schools do everywhere else in London. I want to speak briefly about the funding formula and other funding pressures that schools face, but I will say at the outset that I would be an advocate for more funding for schools—that should be a priority. As a Parliamentary Private Secretary for the Department of Health I sit here in countless debates asking for more funding for the NHS—indeed I sit in debates asking for more funding for all other areas of public spending, and see colleagues ask for more funding across the board—but what I would focus on is more funding for education. We cannot just demand more funding for everything; we have to identify where we would raise the additional revenue or what we would cut.

The funding formula came about after a cross-party campaign that was premised on an agreement that the funding for schools was not fair, in the sense that it was not equitably distributed and that different parts of the country with similar demographic profiles were seeing different funding for their schools. The campaign was never based on levelling up to the level of schools funding in the highest funded area—Tower Hamlets. That would have added billions of pounds to the cost of the funding that is required for schools, and no party committed to that in their manifesto. In any new funding formula there are going to be winners and losers. I expected that, as the third worst funded borough in London, we would be a winner, although I had hoped that it would have been by more than 0.9%, with some schools’ funding going down.

Having followed this and other debates on the funding formula carefully, I have not actually heard any coherent criticisms of the general approach to the funding formula in terms of the per pupil funding and the additional factors. No one seems to disagree that those are the right factors. What they disagree with is that, as a result, some schools’ funding is going down. Personally, I would like to have seen a more radical approach, because that would have ended the unfair and inequitable situation that schools in Tower Hamlets, 14 miles away from my constituency, receive £2,406 per pupil more than schools in Kingston, on top of the pupil premium, which is not counted in those figures.

Jim Fitzpatrick 

indicated assent.

James Berry 

The hon. Gentleman is nodding. Before I am intervened on by an MP from Tower Hamlets, I completely accept the political consensus that we should address social deprivation through funding for education. I completely accept that schools in Kingston are always going to get less than schools in Tower Hamlets, where there is a higher index of social deprivation. However, if we take into account the pupil premium figures and the differential in the same city of £2,400 per pupil, that is simply not fair. In my stage 2 response to the fairer funding consultation, I asked that the per pupil funding element should not be reduced to a weighting below the current 76%, unless significant additional funding is identified for the additional factors.

I want to touch on the other pressures beyond the fairer funding formula. I have spoken to many of my headteachers in Kingston, and frankly their concern is not with the fairer funding formula primarily, but with the other pressures on their budgets. Some of those have been mentioned. They include increased employers’ national insurance contributions, increased pension contributions, increased national living wage, the apprenticeship levy, the equalisation of sixth-form and further education funding, the reduction in the education services grant and a general increase in costs.

Another factor that I imagine affects other hon. Members as well, and certainly has a profound effect in Kingston, is the huge overspend in high-needs funding. It has resulted, as in other boroughs, in Kingston having to top-slice the dedicated schools grant to the level of the minimum funding guarantee. It is a demand that Kingston’s schools and Kingston Council are not really in a position to regulate, because a lot of the high-cost, private school, out-of-borough placements—sometimes of more than £200,000 per pupil—are made by the first-tier tribunal for special educational needs. Kingston Council is trying hard to address the issue by supporting applications for two new free schools—two special schools, one in Kingston and one in the constituency of my hon. Friend the Member for Twickenham (Dr Mathias)—so that we can better deal with high-needs children in borough, but this matter needs to be addressed. We need more funding for high-needs provision in particular.

Dr Tania Mathias (Twickenham) (Con) 

I absolutely agree with everything my hon. Friend says about the pressures regarding special educational needs. These are unpredictable, six-figure sums—he is absolutely right about that. Does he agree that there is a case for there being a separate pot, perhaps of central funding, because those costs are unpredictable year on year and are increasing?

James Berry 

In addition to the funding formula, those additional costs need to be addressed. I will close by rebutting the ridiculous suggestion that has been made, although not in this Chamber today, that we should cut funding for new schools and use it for existing ones. In London we know that there is an acute pressure for school places, and that the cost of buying the sites for them is very significant. Some 750,000 new places are needed by 2025. Yes, we need more funding for schools now, but we will create a terrible situation for pupils if we take away the funding that has been put aside for the schools we need to build and that I very much welcomed in the Budget.

Mr David Lammy (Tottenham) (Lab) 

I congratulate my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) on securing this debate. I think that the tone has been very measured, but I say to the Minister that back in communities across London there is tremendous fury, frankly, at what the Government are proposing. I really want to warn him. I went to school in the 1970s in London; I have seen schools in the 1980s in London, and I am deeply worried that we will be returning to that story in this city. When London slips back, as night follows day, the nation slips back on education. London’s contribution to our GDP is bigger than at any time since 1911. In the Brexit environment that we are now going into, this is a very dangerous move. The Government simply cannot talk about social mobility and about families that are just getting by, and see the sorts of devastating cuts that we are hearing about right across the city.

Mr Gibb 

Will the right hon. Gentleman give way?

Mr Lammy 

No, I will not give way. I think of the Willow Primary School on the Broadwater Farm estate—no one at that school is well off—and of the six teachers and all the learning mentors that it might have to lose. I ask the Minister, with all sincerity, how he can stand by the cuts. When he says to my hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick) that Tower Hamlets is the best-funded local authority in the country, has he knocked on doors in Tower Hamlets? Has he seen the deprivation that exists in Tower Hamlets?

The Minister knows, as we all do, that the education debate in this country is not between state schools in deprived areas of the country, but between the state schools and private schools. That is the big gap, and that is what any Government with any ambition to raise the standards of children across the country should be seeking to match, not cut. Let us not have this fake debate about redistribution across already deprived constituencies, when the real debate is how we level up to the standard of private schools. When he says, “Look, you are getting just under £7,000 in Tower Hamlets,” let him remember that a child that goes to Eton means £33,000 a year. That is the debate. If he is sincere about social mobility, he will go back to his friends in the Treasury and ask for more.

I have been asked by this Government to do a review into the disproportionate number of black and ethnic minority young people and adults in our criminal justice system. I have to warn the Minister that this situation will lead to more young people in our pupil referral units, and more young people in our young offenders institutions and prisons as a direct result. That is because teaching assistants help to keep the peace and order in our schools, and help with kids with special needs, and they will have to go. It is because a class size of 30 or 32 kids is hard on one teacher. I commend all teachers committed to teaching in deprived constituencies; it is a vocation that none of us should forget about in this debate.

I say to the Minister, do not just interrupt Members and quote the figures blindly at us. We know what this is about. This is a direct cut of the education budget. The Government are turning their back on a commitment they made when they first came into office, and we must and will hold them to account.

Dr Tania Mathias (Twickenham) (Con) 

It is a pleasure to serve under your chairmanship, Mr Hanson. I will try to be brief, as I agree with most of my colleagues’ points. I, too, have had meetings with hundreds of parents and with smaller groups of parents, and I have met many headteachers.

I have received many letters from children and I will highlight one of those, because thankfully the children are celebrating, rather than being fearful of the changes to their schools’ budgets. Serine Zahr of Hampton Hill Junior School told me that her school is precious because of its values. She noted that in Hampton Hill Junior School, they are “collaborative like a bee” and “reflective like a swan”. As I am sure the Minister knows, most of the schools in my area are good or outstanding, as evidenced by Serine.

There is concern among teachers and parents. In particular, parents who help in schools—the schools appreciate them giving up their time—are rightly concerned that although they are giving their time in the classroom, they are now being asked to contribute money because of the fear of losing teachers and, even in one school, for repairs to the toilet blocks. That shows that although there is less argument about the funding formula—headteachers agree that the formula needs to change—the issue is the overall real-terms cost per pupil. I note the pertinent comparison made by my hon. Friend the Member for Enfield, Southgate (Mr Burrowes) with the amount we are spending on debt interest. I agree with other colleagues that education must be a priority.

I agree with some of my colleagues’ points about small wins. I know that the apprenticeship levy is less than 1% of the budget, but does it have to apply to schools? Although I appreciate the point made by my hon. Friend the Member for Kingston and Surbiton (James Berry) about no party asking for a levelling up, we need some levelling up per pupil.

In the longer term, there could be a review of governors. I have been a primary school governor. Now that we need good financial health in our schools, there is an argument over the longer-term duty and training of governors in that respect.

Will the Minister please look at special educational needs funding? The trajectory that it is on cannot be predicted. It is great that children get extra help for milder forms of, for example, dyslexia and dyspraxia, but as my hon. Friend the Member for Kingston and Surbiton said, we need to spend £200,000 a year on some children to ensure that children have, as we say, educational excellence everywhere.

I thank the Minister for being here and I really appreciate his interrupting hon. Members. He did not interrupt me, probably because we have a very small increase in our area. The issue is not the formula in particular, but the overall grant and the per-pupil protection.

Andy Slaughter (Hammersmith) (Lab) 

It is a pleasure to serve under your chairmanship for what I think is the first time, Mr Hanson. I also congratulate my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) who set out her case admirably, allowing me to do what I should do, which is to concentrate on the situation in Hammersmith.

I had a conflict of interest a couple of weeks before the consultation closed. As well as needing to be here, I was being asked almost every day to be at the school gates at 3.30 pm, which is not the best time to persuade the Whips that I should not be here. I managed to play truant on at least three occasions and go to meetings at Wendell Park, Brackenbury and Kenmont schools in my constituency. I say meetings, but they ranged from sober affairs, with speakers from the local authority, the headteacher and myself explaining the not-always-entirely-clear 75-page document that people had to fill in, to rather more exuberant demonstrations, with a lot of visual aids prepared by the children in playgrounds to express their views on what was happening. I am also grateful to the local authority in Hammersmith; Sue Macmillan, the cabinet member for children’s services, who came back from maternity leave to organise that; and Sue Fennimore, the cabinet member for social exclusion, who organised a meeting for some 400 parents and governors at Hammersmith town hall before the consultation ended.

I mention all that because I have never seen such unity of purpose on an issue before. Irrespective of political allegiance or indeed any other factors—we have extremely mixed communities in Hammersmith—the whole school community, including governors, parents, teachers, pupils and headteachers, all came together, which is perhaps not surprising, given that Hammersmith faces the largest cuts possible in formula funding. Forty-seven headteachers from the 48 schools have written to the Government expressing their concern—I do not know about the one headteacher who did not, but I am told he does not look at his emails too much. All 48 schools in Hammersmith will lose almost 3%. However, this debate is not just about the national funding formula; it is about school funding, and I echo what Government Members, as well as Opposition Members—

Jeremy Quin (Horsham) (Con) 

Will the hon. Gentleman give way?

Andy Slaughter 

If the hon. Gentleman does not mind, I will not, given the time. Government and Opposition Members have said that this is about the overall picture. It seems extraordinary that substantial sums of money should be taken away from schools in deprived areas through the formula funding when other cuts are being imposed.

I agree with what my hon. Friend the Member for Wythenshawe and Sale East (Mike Kane) said from the Opposition Front Bench. The figures from the NUT and other unions should not be rubbished by the Government, but looked at, because they give an overall picture of the cuts that there have been over a number of years, starting as long ago as 2013 and going through to 2020, and possibly beyond.

Let us look, for example, at Ark Burlington Danes Academy, which is a very successful academy with 67% of pupils on free school meals. By 2020, it will have lost 18% of its budget. Hammersmith Academy, which is a new-build academy with 61% of pupils on free school meals, will have lost 25% of its budget. Wormholt Park Primary School, which has 59% of its pupils on free school meals, will have lost 16% of its budget. As the Minister can readily tell, those schools have very deprived intakes and they are losing unsustainable amounts of money.

In addition to the cost pressures, which cannot be separated out as the Minister would like, what will happen if we have the misfortune of the Government continuing this after 2020? The NUT has pointed out that, according to the Government, several schools will still be overfunded. Will they be restricted by not having inflation increases thereafter? What are the plans? In my constituency a number of schools will still be said to have, once the floor is imposed, funding that is 10% above what they should have, and in one case, 31% above. How are those figures in any way realistic or sustainable for schools to cope with?

Given the amount of time that the Minister has been in the job, he ought to appreciate the absolute sapping of morale, particularly among teaching staff in these areas. It is absolutely right that London schools are a huge success story, but like the rest of the country, we have been through a lot of trauma, with the loss of Building Schools for the Future. Without going into the politics of it, there has also been the way in which academies and free schools have been introduced, and the imbalance of resourcing going to those schools rather than to community schools.

My hon. Friend the Member for Dulwich and West Norwood mentioned English as an additional language, special educational needs, deprivation and turnover. In particular, the effects of the Government’s housing policies mean that not only has there been this extraordinary churn, but families are regularly being thrown out of London and they then have to commute hours back with their children every day. Schools are seeing a huge turnover of pupils. Those things cannot be coped with easily. Schools need additional resources and we do not need this destabilisation.

I will continue doing the school gate meetings, even though the consultation has closed, because what has happened has awakened an appreciation of the overall attack on school budgets under this Government. It is unprecedented—it has not happened for at least 20 years or perhaps longer—so I echo what Members on both sides of the Chamber have said. Nobody wants the funding not to increase or the funding gaps not to be addressed in schools that may have been historically underfunded for a number of reasons. That is certainly not the fault of London education authorities, which have always—going back to the days of the Inner London Education Authority—prioritised funding for inner-city schools. However, the problem will not be addressed by substantially reducing the funding and resources of schools in London, which have done a fantastic job over the last 10 to 20 years in changing the mood and the climate. The Minister should wish to emulate that around the country, not drag London down.

Mr David Hanson (in the Chair) 

I call Wes Streeting. I ask him to finish his speech by 10.35 am.

Wes Streeting (Ilford North) (Lab) 

It is a pleasure to serve under your chairmanship again, Mr Hanson. I will be mindful of the clock.

The Minister will be able to cross out huge sections of his speech because of the number of interventions he has made. I am sure that when he came here this morning, he would have been delighted to have a debate about the education funding formula, but let me save him from intervening on me. He would tell me that in my constituency there are 24 winners and five losers from the formula, generating an additional £2.8 million, but even by the conservative estimate of London Councils, which uses National Audit Office figures to look at cost pressures, my constituency’s schools will lose £3.6 million.

The Minister has great attention to detail, so he knows as well as anyone that the principle of the education funding formula and the rebalancing of budgets is not contested. The real problem is the real-terms cuts to all schools throughout the country, alongside serious inflationary pressures and rising costs. In fact, the Institute for Fiscal Studies has said that school funding per pupil has been frozen in cash terms until 2019-20, resulting in a real-terms cut of 6.5%, which it describes as

“the largest cut in school spending per pupil over a 4 year period since at least the early 1980s”.

It is not even a case of robbing St Peter’s school to pay St Paul’s. The whole system is losing money and pupils will suffer as a result.

Take my own borough, the London Borough of Redbridge, of which I should declare that I am still a councillor. Taking into account cost pressures, funding cuts and the education funding formula, more than £15 million will be taken out of its schools by 2020—about £338 per pupil per year, which is equivalent to losing 411 teachers. Redbridge Primary School, which I know the Minister has visited—I went there to play the recorder with him—will lose £396 per pupil per year, which is equivalent to losing seven teachers.

The worst-affected primary schools include Ilford Jewish Primary School, which will lose £575 per pupil per year, and Ray Lodge Primary School, which will lose £554 per pupil per year—equivalent to nine teachers. Beal High School, one of our largest secondary schools and a great, successful academy school, will lose more than £500,000—£357 per pupil per year, or 15 members of staff. Even my local grammar school, Ilford County High School, will lose just shy of £300,000 because of cost pressures—£498 per pupil per year. That is partly a reflection of the terrible funding settlement that the Minister has received from the Treasury, but it is also a reflection of the terrible priorities of the Government under the new Prime Minister.

Brett Wigdortz, who as founder and chief executive of Teach First has done more to tackle educational disadvantage in this country than most, said:

“Some of the most depressing things I’ve seen in England were going to East London and seeing outstanding schools where kids from low income backgrounds were getting a world class education… And then you travel 20 miles to the south-east into Kent, which has a grammar school system and visit schools there, and they’re very depressing places I would say.”

It is a scandal that the majority of schools in this country are losing money to fund ideological pet projects such as the expansion of grammar schools, when there is no evidence that they will tackle educational disadvantage—quite the opposite.

I conclude by reflecting on my own experience as a child of the 1980s who went to primary school in east London and secondary school in central London—I have lived in London for my entire life. My old primary school, St Peter’s London Docks, which my hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick) referred to, will lose £732 per pupil per year—£144,982 by the end of the decade. My old secondary school, Westminster City School, which is just down the road, is losing more than £500,000—£831 per pupil per year or the equivalent of 12 teachers. From visiting the school, I know the impact that that is having on the curriculum and on the wide provision of choice at a secondary school that still serves a majority deprived population with a high free school meal intake.

Through its educational provision, that school took a council estate boy from Stepney in east London and gave him opportunities that he would never otherwise have had. Without those opportunities, I would never have been elected to Parliament. It also took a Peckham boy from a south London council estate, John Boyega, gave him great drama teaching and sent him to Hollywood as one of the stars of “Star Wars”. The school no longer has curricular or extracurricular drama provision. That should rest on the Government’s conscience. It is to their shame, because those are the chances that take kids from council estates and give them a world of opportunities enjoyed by those from the most wealthy and privileged backgrounds.

Mike Kane (Wythenshawe and Sale East) (Lab) 

It is a pleasure to serve under your chairmanship, Mr Hanson. I congratulate my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) on securing this debate and on her impassioned speech.

As my hon. Friend the Member for Ilford North (Wes Streeting) said, under this Government we are seeing the largest real-term cuts for 20 years. The schools budget will not be protected in real terms and will not rise during the Parliament, and funding will be protected only in cash terms. No planning for budgets has been put in place by the Department for Education to cover the cost pressures that have been articulately pointed out by hon. Members today, such as inflation, the living wage, pension provision and the apprenticeship levy, which the hon. Member for Sutton and Cheam (Paul Scully) mentioned. There has already been a sharp rise in the proportion of secondary schools in deficit, which has risen to nearly 60% in 2014-15, according to the National Audit Office. The NAO has also confirmed that there will be a real-terms reduction in funding per pupil because of a failure to increase funding in line with inflation. That, I am afraid, is a clear breach of the Conservative party’s manifesto commitment.

Catherine West (Hornsey and Wood Green) (Lab) 

Does my hon. Friend agree that this is, in essence, an attack on all young people, regardless of whether they live in London or anywhere else in the country? This is an attack on the future generations of this country.

Mike Kane 

My hon. Friend the Member for Dulwich and West Norwood pointed out that it would take 1% of the education budget to level up in London—about £500 million. Some £380 million was clawed back from the Department for Education for its failure to convert enough schools to multi-academy trusts. This can be done—it can be achieved—but, as with their U-turn last night to downgrade GCSE passes to grade 4, we can only hope that the Government will see the light on the key issue of the £3 billion of funding cuts that we face between now and 2020. The funding formula amounts only to redistributing a small sum of money while we face cuts across the board. Instead of moving an inadequate sum of money around, what is required is investment in all our schools, for every child.

The Library briefing states that

“inner London constituencies are expected to see the biggest fall in funding under the consultation proposals.”

There are particular pressures on London from the fair funding formula, as has been pointed out. The number of children on free school meals has declined in London, partly because of gentrification in particular areas, but also because of benefit changes, which mean that fewer children are eligible. That is having a disproportionate impact on school budgets in London.

The Secretary of State has said that no school should lose more than 1.5% of its funding as a result of changes to the funding formula. However, it has already been shown by the IFS and the NAO that, given the budget cuts, cuts to schools will be far more severe. Those are the figures on the union’s website.

Jeremy Quin 

I come from a part of the country with £2,000 per pupil less than the London average. Will the hon. Gentleman confirm that he believes that there should be fairness in how we distribute funds between schools? That is what the NFF is about, and it is welcomed very broadly around the country.

Mike Kane 

There should be fairness in the funding formula. There are good things in it, such as an emphasis on high needs, a deprivation index, a focus on prior attainment—why would we not welcome those things?—but we have seen many U-turns from the Department. I would bet my bottom dollar that, with the pressure that is coming from all hon. Members, we will see another one. I am worried that we will also see a U-turn on some of the good things about this funding formula.

The financial challenges of providing London school places is huge, because of the cost pressures and land values. That is why we have seen the Government U-turn on the 50% faith school cap. The Catholic Church needs to build at least 40 new schools in London and the Government have had to U-turn on their policy from 2010.

The free school programme in London is not subject to any spatial planning whatsoever. There was a school in Bermondsey that recently closed down after £3.5 million was spent in two years on educating 60 pupils. That was £60,000 per pupil. As my right hon. Friend the Member for Tottenham (Mr Lammy) said, we could have sent those pupils to Eton for half the price. That is what happens when there is a free school programme that is not subject to spatial planning.

James Berry 

Will the hon. Gentleman give way?

Mike Kane 

I will not give way, if the hon. Gentleman will forgive me. I really am up against the clock.

The Education Funding Agency is paying inflated prices for land, particularly in London. Funding issues are hitting teacher recruitment, as has been articulately pointed out. Pay in real terms for teachers has fallen by 10% since 2010. The jobs market is beginning to pick up, no wonder we are failing to meet our graduate targets for teacher training, which adds to the pressures. The cost of living, as has also been pointed out, and the cost of childcare are exacerbating the problems, as is inflation. My hon. Friend the Member for Mitcham and Morden (Siobhain McDonagh) has been articulate for weeks and months in the Chamber on the effect of London’s housing crisis, which means that teachers are priced out of the market.

As I have said, the Opposition would love to support elements of the funding formula. I remember the joke by Peter Kaye, who is a Bolton comedian. When his children were trying to get to sleep but could not do so because of the “wardrobe monsters”, he rang them up and said, “Don’t worry about the wardrobe monsters. It’s the burglars coming in through the roof!” This issue is not about the funding formula, a high needs index, a deprivation index or the focus on prior attainment; it is to do with cost inflation. The Minister should stop confusing the matter for his own Back Benchers and for Parliament. The national funding formula will not touch the sides of what needs to be done to avert a massive crisis in our schools.

We need change. The Minister should not bang on about the funding formula. He needs to address the cost pressures that all schools face. He needs to tell them, which he has not done so far, how they are to make the savings required. More importantly, however, he needs to tell us how he will change his mind in the weeks and months to come.

The Minister for School Standards (Mr Nick Gibb) 

It is a pleasure to serve under your chairmanship, Mr Hanson.

I congratulate the hon. Member for Dulwich and West Norwood (Helen Hayes) on securing this important debate. I trust that she would agree that we share the ambition to have a country that works for everyone, where all children have the opportunities for an excellent education that unlocks talent and creates opportunity. That should be regardless of their background or where they live, which is why today 1.8 million more pupils are in good or outstanding schools than was the case in 2010, and why 147,000 more six-year-olds are now reading more effectively this year compared with 2012 as a result of our reforms.

The Government are prioritising spending on education and have protected the core schools budget in real terms so that, as pupil numbers increase, so will the amount of money for our schools. School funding today is at its highest level on record at more than £40 billion in 2016-17, and is set to rise to £42 billion by 2019-20. However, the current funding system is preventing us from ensuring that the money is allocated fairly. In the current system, similar schools and similar local authority areas receive very different levels of funding with little or no justification. For example, a secondary school in Wandsworth that is teaching a key stage 3 pupil with English as a second language and low prior attainment would receive £7,699, but if that same pupil were in a school in the neighbouring Borough of Lambeth, the school would receive £10,263, which is a difference of more than £2,500. There is no reason why moving just a single mile should lead to such a change in funding.

Opposition Members complained about the debate. They do not like their figures being challenged, but I am afraid that I am going to do so, because they repeatedly cite misleading campaign data from the National Union of Teachers. First of all, let us take the hon. Member for Nottingham—

Mr Lammy 

It is Tottenham.

Mr Gibb 

Haringey is the 11th best-funded local authority in the country at the moment and it will remain—

Mr Gibb 

I will not give way. Haringey will remain the 11th highest-funded authority.

Allocations are based on 10-year-old data—2005 data—but during that 10-year period deprivation in London has been reduced. In 2005, 27% of pupils in London were eligible for free school meals; today, that figure is 18%. By ensuring that we allocate funding on the basis of up-to-date data and fairly, we can allocate £5 million more to boroughs such as Merton, the funding of which will rise from £114 million a year to £119 million a year, reflecting the fact that Merton has been underfunded in the past. It was disappointing—

Wes Streeting 

rose—

Mike Kane 

rose—

Mr Gibb 

I will not give way to either of the hon. Gentlemen. It was disappointing that the hon. Member for Mitcham and Morden (Siobhain McDonagh) did not acknowledge that, directly as a consequence of this fairer way of allocating funding—this new funding formula—her schools are receiving £3.5 million more.

The hon. Member for Ilford North (Wes Streeting), who is itching for me to give way, said that his Borough of Redbridge was seeing a reduction in funding. I am afraid that that is simply not the case. Redbridge’s school funding will increase from £201,600,000 to £209,859,000, a 4.1% increase, as a direct consequence of the introduction of a national funding formula.

Mike Kane 

Will the Minister give way?

Mr Gibb 

I will not give way.

These anomalies will be ended once we have a national funding formula in place, which is why introducing fair funding was a key manifesto commitment for this Government. Fair funding will mean that the same child with the same needs will attract the same funding, regardless of where they happen to live.

We launched the first stage of our consultation on reforming the schools and high needs funding systems in March last year. We set out our principles—

Mike Kane 

On a point of order, Mr Hanson.

Mr David Hanson (in the Chair) 

I hope it is a point of order, Mr Kane.

Mike Kane 

Mr Hanson, it should be noted that Members from all parties, including myself, were generous in giving way to the Minister. The Minister has not been generous in return.

Mr David Hanson (in the Chair) 

I am afraid, Mr Kane, that that is not a point of order for the Chair. The Minister is entitled to give way or not give way according to his own preference.

Mr Gibb 

Thank you, Mr Hanson; I want to respond to all the points that were made in the debate.

We launched the first stage of our consultation on reforming the schools and high needs funding systems in March last year. We set out the principles for reform and proposals for the overall design of the funding system. More than 6,000 people responded to that first stage of our consultation, with wide support for those proposals. I acknowledge the support that the hon. Member for Wythenshawe and Sale East (Mike Kane) has given to the principles of this formula.

We have just concluded a 14-week second stage consultation, covering the detailed proposals for the design of both the schools formula and the high needs formula. Our proposals will target money towards pupils who face the greatest barriers to a successful education. In particular, our proposals will boost the support for those from disadvantaged backgrounds, and for those who live in areas of deprivation but who are not eligible for free school meals—those ordinary working families who are too often overlooked. We are also putting more money towards supporting those pupils in both primary and secondary schools who have fallen behind in their education to ensure that they have the support they need to catch up.

Overall, 10,740 schools would gain funding under our proposals, and the formula will allow those schools to see those gains quickly, with increases of up to 3% per pupil in 2018-19 and of 2.5% in 2019-20. Seventy-two local authority areas will quickly see an increase in their high needs funding, and no local authority will see a fall in its funding.

As well as providing those increases, we have listened to those who highlighted in our first stage consultation the risks of major budget changes for schools. That is why we have proposed to include significant protections in both formulae. No school would face a reduction of more than 1.5% per year or of 3% overall per pupil and, as I have said, no local authority will lose funding for high needs. The proposals will limit the otherwise quite large reductions that some schools, including many in London, would see as the funding system is brought up to date.

The real-terms protection of the core schools budget underpins these proposals. As a result, we are able to allocate some £200 million to schools in both 2018-19 and 2019-20, over and above flat cash per pupil funding. That will combine significant protection for those facing reductions with more rapid increases for those set to gain under the fairer funding formula. High needs funding will see an equivalent real-terms protection.

London will remain the highest-funded part of the country under our proposals. Schools in inner London will attract 30% more funding per pupil than the national average, which is right. Despite the city’s increasing affluence, London schools still have the highest proportion of children from a deprived background and the highest labour market costs, as has been acknowledged in the debate.

We are using a broad definition of disadvantage to target additional funding to schools, comprising of pupil and area level deprivation data, prior attainment data and data on English as an additional language. No individual measure is enough on its own. Each factor reflects different aspects of the challenges that schools face, and they work in combination to target funding. Where a child qualifies for more than one of those factors, the school receives funding for each qualifying factor. For example, if a child comes from a more disadvantaged household and they live in an area of socioeconomic deprivation, their school will attract funding through the free school meals factor and the area-level deprivation factor—the income deprivation affecting children index.

The additional needs factors in the formula are proxies for the level of need in the school. We are not suggesting that the funding attracted by an individual pupil must all be spent on that pupil, but that schools with high numbers of pupils with additional needs are more likely to need additional resources. Using the proxy factors helps us target funding on schools that are more likely to face the most acute challenges. I will give way to the hon. Member for Dulwich and West Norwood (Helen Hayes), who introduced the debate, if she wants to come in on that point. If not, I will press on.

Helen Hayes 

I will come in at the end.

Mr Gibb 

Very good. In addition to the formula, schools will continue to receive additional funding through the pupil premium to help them improve the attainment of the most disadvantaged pupils. We have also included a mobility factor in our formula to recognise the additional costs faced by schools, many of which are in London, where a high proportion of pupils arrive at different points through the year. We were influenced by the right hon. Member for East Ham (Stephen Timms) in making that change. London schools will receive additional funding to reflect the higher cost base they face from being in London, which is particularly important given that so much of schools’ spending goes on staffing costs. The higher funding for London schools will support them to continue their success in recent years, particularly for children from disadvantaged backgrounds.

I understand the reactions of those Members who are disappointed by our formula’s impact on their constituencies. The formula is not simply designed to direct more money to historically lower-funded areas or areas with the highest levels of deprivation. It is designed to ensure that funding is properly matched to need using up-to-date data, so that children who face entrenched barriers to their education receive the support they need. That includes pupils who do not necessarily benefit from the pupil premium but whose families may be only just about managing.

Andy Slaughter 

The debate is about schools funding in London and the Minister is almost exclusively talking about the formula. Does he not understand that the additional cost pressures talked about by my headteachers in the letter they sent to the Secretary of State are having an effect on all schools in addition to the funding formula? It is that combination that is causing these difficulties.

Mr Gibb 

I recognise that schools are facing cost pressures, including salary increases, the introduction of the national living wage, increases to employers’ national insurance and pension scheme contributions, and general inflation. We have estimated, as has been acknowledged in the debate, that national pressures will add about 8% per pupil between the start of 2016-17 and 2019-20, but it is important to note that some of those cost pressures have already been absorbed, and 8% is not an estimate of pressures to come. Over the next three years, per pupil cost pressures will on average be between 1.5% and 1.6% each year.

The current unfair funding system makes those pressures harder to manage. We felt very strongly that introducing a national funding formula will direct funding where it is most needed. That will help schools that have historically been underfunded to tackle those cost pressures more easily. We will continue to provide advice and support to schools to help them use their funding in cost-effective ways and improve the way they buy goods and services so that they get the best possible value for their pupils. We have published a wide range of tools and support, which are available in one place on the gov.uk website and include tools to help schools assess their level of efficiency and find opportunities for savings, guidance on best practice, including on strategic financial planning and collaborative buying, and case studies from schools. We have launched the school buying strategy to support schools to save more than £1 billion a year by 2019-20 on their non-staff expenditure.

In addition to those pressures, I appreciate that schools will be paying the apprenticeship levy. As my hon. Friend the Member for Sutton and Cheam (Paul Scully) pointed out, the apprenticeship levy comes with real benefits for schools. It will support schools to train and develop new and existing staff. It is an integral part of the Government’s wider plan to improve productivity and provide opportunities for people of all backgrounds and all ages to enter the workplace.

In conclusion, I am grateful for this opportunity to debate school funding in London. I hope Members are reassured to some extent that the Government are committed to reforming school funding and delivering a fair system for children in London and across the whole country—a system where funding reflects the true level of need of pupils in schools.