National Funding Formula to go ahead in 2018/19

At last the government has confirmed that the NFF will go ahead in 2018/19, at least in the ‘Soft NFF’ form where local authorities will still run a local formula. The proposal for a ‘Hard NFF’ with DfE funding all schools in the country, originally planned for 2019/20, cannot go ahead yet, because it requires primary legislation which was not included in the list of Bills announced in the Queen’s Speech. As that was a two-year legislative plan, dominated by Brexit legislation, this means direct funding can’t be introduced until 2020/21 at the earliest.

The plans to cut universal infant free school meals have been abandoned, so it’s not clear how the extra money that is being provided to achieve a ‘no losses’ guarantee will be found. Nick Gibb confirmed in his replies at Parliamentary Questions on 4th July that the government would ensure no cut in per pupil funding for any school. That is a cash guarantee, not a real terms guarantee. The Minister admitted there were also cost pressures of around 1.5% or 1.6% per year for the next two years, but there has been no promise of any funding to cover them. He referred to the Department’s support for efficiency measures, including the publication of the Buying Strategy. It will take more than that to help schools deal with the real terms cuts that the proposals will cause.

There are some signs of pressure being applied in various quarters to persuade the government that even more funding needs to be found to cover the cost pressures, but we will have to wait for the announcement to find out if this will materialise. Nick Gibb used the infamous DfE word ‘shortly’ when asked when further details would be available. Let’s hope that the announcement is made before schools break up for the summer, otherwise it will be a long six weeks.

Nothing has been said yet about the High Needs NFF. As you will know if you follow my blogs at https://schoolfinancialsuccess.com, this is the area of the reforms I’m most concerned about. From my work with local authorities, I know there are some significant increases in both demand for expensive specialist placements and the cost of top up funding paid to schools for pupils with SEND. With a significant number of LAs likely to face a cash freeze or minimal increases in their High Needs Block allocations when the NFF is introduced, the current trends are unaffordable.

Yet DfE proposes putting an end to LAs’ ability to transfer money from the Schools Block to cover cost pressures for SEND. The last opportunity will be in 2018/19, though this may require a majority of schools to agree rather than the Schools Forum, and DfE has said it is considering placing limits on transfers, after examining what happened in 2017/18. From 2019/20 they are proposing that it should be an individual school decision whether to make any contribution towards High Needs pressures or not. Given the potential scenario in the Schools NFF, it could be very challenging for LAs to persuade head teachers to agree to give up some of their precious budgets.

It seems quite ridiculous that for SEND, where LAs can’t change eligibility criteria because of the statutory requirements, DfE can refuse to provide sufficient funding and also prevent LAs from managing resources locally to cover rising demand and cost pressures. This could cause significant problems, given the impact of austerity on local authority budgets. There is simply no spare cash to cover any shortfall.

We will have to wait and see what the announcement brings.

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