Lords statement on Education: Funding - July 4

The Parliamentary Under-Secretary of State, Department for Education (Lord Nash) (Con) 

My Lords, with the leave of the House I shall now repeat a Statement made in the other place earlier today by my right honourable friend the Minister for School Standards and for Equalities. The Statement is as follows:

“Mr Speaker, this Government are determined to ensure that all pupils, regardless of where they live, receive a world-class education. Over the past seven years we have made significant progress. There are now 1.8 million more children in schools that are rated good or outstanding than there were in 2010, and today we saw an 8% rise in key stage 2 results, as pupils and teachers rise to meet the challenge of the new, more demanding curriculum and assessments.

Looking beyond schools, the Government have prioritised funding for all phases of education. At the spending review, we announced that we would be investing an additional £1 billion a year in early education entitlements, including funding for the new 30 hours entitlement and funding to increase the per-child rate that providers receive. We protected the national base rate per pupil for 16 to 19 year-olds in sixth forms, sixth-form colleges and further education colleges in England and, in his spring Budget, my right honourable friend the Chancellor announced new investment in technical education for 16 to 19 year-olds, rising to an additional £500 million per year. We have maintained funding for the adult education budget, which supports adult skills participation in cash terms at £1.5 billion per year. We have implemented reforms to higher education to drive greater competition and teaching standards. Together, this adds up to a comprehensive package of support for education at all stages of life.

We want to ensure that every school has the resources that it needs, which is why we have protected the schools budget in real terms since 2010. We set out our intention to increase funding further in our manifesto, as well as continuing to protect the pupil premium to support the most disadvantaged pupils.

We recognise that schools are facing cost pressures. Beyond the total amount of funding going to our schools, we know that there are two crucial questions. First, we know that how schools use their money is important in delivering the best outcomes for pupils. We will continue to provide support to help schools use their funding effectively. Secondly, we know that how funding is distributed across the country is anachronistic and unfair, and that the current system is in desperate need of urgent reform.

We have gone further than any previous Government in reforming school funding. The second stage of our consultation on a national funding formula for schools closed in March, and I am grateful to all 25,000 people who responded, as well as to honourable Members who contributed in the more than 10 hours of parliamentary debates on school funding, and many face-to-face meetings, during the period. It is important that we now consider carefully how to proceed. As outlined in our manifesto, we will make sure that no school has its budget cut as a result of the new formula. We remain committed to working with Parliament and bringing forward proposals that will command a consensus. We will set out our plans shortly”.

Lord Hunt of Kings Heath (Lab) 

My Lords, the House will be grateful to the Minister for repeating that Answer—but whatever gloss he puts on school funding, the fact is that the amount of money per pupil is due to go down between now and 2022. As a result, class sizes will grow and schools will replace qualified teachers with unqualified staff. The Minister had nothing to say about this, yet it is worrying parents up and down the country—except, perhaps, in Northern Ireland. Can he confirm that there is now to be an increase in school funding of £150 per pupil in the Province?

The Minister said that no school would have its budget cut as a result of the new funding formula. Can he confirm that that is in real terms and not just in cash terms? His party’s manifesto promised £4 billion of additional money; £650 million of that was to be obtained by scrapping infant school meals. The Minister in the other place has said that that policy has now been scrapped, so where will that money come from? Is it still the Government’s intention to provide universal free breakfast in primary schools—and, if so, does he now have a proper costing of that manifesto offer? Furthermore, is the Government planning to fund new and expanded grammar schools, or has that also been abandoned?

Lord Nash 

I am grateful to the noble Lord for his questions. To be clear, first of all, on grammar schools, as the noble Lord will know there is no education Bill in the Queen’s Speech and the ban will remain in place, although we will keep working with the Grammar School Heads’ Association and good grammar schools to see how their excellent practice can be spread more widely.

As far as breakfast is concerned, we do not plan to introduce free breakfasts, although we will continue to work on a number of schemes for breakfast clubs, such as Magic Breakfast.

There has been a lot of talk about the expansion of class sizes. Despite the fact that, by this September, schools will already have experienced an increase of more than 3% in their cost base, the actual increase in class sizes in the last six years has been very marginal indeed. This is at a time when we have got 1.8 million more pupils in good and outstanding schools and have created nearly 750,000 new places. I have already said that there will be no cuts in per-pupil funding as a result of the national funding formula. We will be responding in full to the consultation shortly and I am afraid that the noble Lord will have to wait until then for the answers to the rest of his questions.

Lord Storey (LD) 

My Lords, I am grateful to the Minister for his Statement. He is right to say that funding is anachronistic in England. I was pleased to hear that there will be no cuts to any school budgets. Presumably with the fair funding system there would be winners and losers, so he is clearly saying that the losers—in other words, those whose budgets will not go up—will not be cut at all. However, there is a problem now. When I asked an Oral Question back in March, I pointed out that audit figures showed that, on average, over the next four years, every primary school will be £74,000 worse off and every secondary school will be £291,000 worse off. In his reply, the Minister said it was about organising things differently and that better deployment of staff, efficiency savings and redeployment of non-teaching staff in schools could save £1 billion. He has never said how and where that is going to happen.

My main question is in regard to sixth-form colleges. The Minister believes in fair funding for all secondary and primary schools, but he clearly does not believe in it for sixth-form colleges—because only those which have become academies are VAT exempt. Those that choose to remain maintained have to pay VAT. That is surely grossly unfair. Why is the Minister not prepared to allow the same advantage to all sixth-form colleges? If he did, it would mean an immediate amount of money for the maintained ones. At the same time, why has the full amount of funding for sixth-form colleges—£200 million—been held back? That could be released to them as well.

Lord Nash 

I am grateful to the noble Lord for recognising that we have been the first Government for some time to grasp the issue of the anachronistic state of school funding. It was never going to be easy —that is quite obvious from the debates we have had. However, we are determined to press on and make school funding fair. As I have said, there will be no cuts per pupil as a result of the national funding formula.

I would invite the noble Lord to come into the department and see the extensive work we are doing on school efficiency and organisation to make sure that schools fully understand how to make the resources available in a more efficient way so that there are many more resources for the front line. I recognise the pressures that schools are facing, but it is a fact that under the Labour Government schools received a 5.1% per annum increase in their funding in real terms and that during that time we slumped down the international league tables in the performance of our schools. So it is not just about money; it is about the efficient deployment of resources.

Baroness Andrews (Lab) 

My Lords, the Minister has been insistent on fairness in both the Statement and in what he has just said. I am sure that he is familiar with the work of the Education Policy Institute, which said in a recent report that:

“The most disadvantaged primary and secondary schools in London are expected to see an overall loss of around £16.1 million by 2019-20 ... In addition, the distribution of funding based on area deprivation … shows that pupils who live in the least deprived areas experience the highest relative gains”.

What is fair about that?

Lord Nash 

The noble Baroness refers to the Education Policy Institute, with which I am very familiar as I attended its one-year anniversary event only a couple of weeks ago. It is a very excellent organisation, ably chaired by my ex-colleague David Laws. As I have said, we are determined to make the funding formula fair. As the noble Lord, Lord Storey, said, it is clear from what we have said that we have looked at the issue of losers. We will redress that in the fact that no school will have its budget cut on a per-pupil basis as a result of these changes. Certainly, as part of the consultation—the 25,000 responses we have had—the point made by the noble Baroness has been made.

Lord Alton of Liverpool (CB) 

My Lords, the Minister probably shares the concern of other noble Lords about the number of teachers who are leaving the profession prematurely—especially young teachers, some of whom have told me recently about the unbearable pressures and stress that they have had to endure, which is why they are pulling out of teaching. Given the great cost involved in training teachers to work in our classrooms, does the noble Lord share that concern? Can he tell us how many teachers have left the profession over the course of the last 12 months?