Dame Meg Hillier MP, Chair of the Public Accounts Committee

Deprived local areas and schools ‘hit hardest’ by DfE’s school funding changes  - counter to Government commitment to “level up”

Added to ongoing SEND delays means most vulnerable children “face uncertain future”

A PAC report today (22 Oct) says the Department for Education (DfE) “failed to take enough account of the impact of its decisions on individual schools and their pupils” when it announced changes to the school funding system, with the adverse impacts falling “disproportionately on deprived local areas and schools”.

The new national funding formula introduced in 2018-19 has caused re-distribution of funding from more deprived schools to less deprived schools: average per-pupil funding has fallen in real terms by 1.2% for the most deprived fifth of schools but increased by 2.9% for the least deprived fifth. Changes to the pupil premium funding also mean schools have lost out on £90 million of funding to support disadvantaged children.

There is a lack of urgency in DfE’s approach to making improvements to the school system. Delivery of a number of initiatives has slipped with DfE “unwilling or unable” to commit to revised timetables. “While the Department drags its feet, more and more children with special educational needs and disabilities are progressing through the school system without the support they need.” The ongoing delays publishing the SEND review announced two years ago are “unacceptable”.

The Department has committed £3.1 billion to help children and young people catch up on learning lost due to the disruption caused by the COVID-19 pandemic, but this funding drops significantly from 2022-23 and falls well short of the £15 billion that the Government’s own Education Recovery Commissioner recommended.

In January 2020, there were more than 20,200 mainstream state schools in England, educating more than 8.1 million pupils aged four to 19. 58% of these are maintained schools, funded and overseen by local authorities, the rest are academies, independent of local authorities, educating 4.4 million pupils. DfE is responsible for the school system and is ultimately accountable for securing value for money from the funding provided for schools. In 2020-21 it provided mainstream schools with core revenue funding of £43.4 billion. 

Dame Meg Hillier MP, Chair of the Public Accounts Committee, said:

“Schools are facing a perfect storm of challenges with promises of teacher pay rises, per pupil funding changes and falling rolls but no clear plan from the Department for Education.

“Schools and pupils in deprived areas are being hit hardest by the funding formula at a time when the government’s commitment is to level up. Add to this the ongoing delays in the review of support for pupils with special educational needs and disabilities and some of the most vulnerable children are facing an uncertain future – on top of the impact of Covid. Every part of government has faced challenges but the impact of the exam chaos, funding uncertainties and repeatedly delayed decisions is hitting young people hard and risks scarring their life chances.”

Nick Brook, deputy general secretary of school leaders’ union NAHT, said:

“This report paints a pretty bleak picture of the government’s policies when it comes to supporting some of the most vulnerable children in our education system.

“Over the last few years, we have seen a new funding formula that directs money away from the most disadvantaged, a pupil premium policy change that has led to the some of the poorest families not receiving funding they should have been entitled to, and a failure to deliver on long overdue SEND reforms. In light of all that, talk of ‘levelling up’ starts to sound rather hollow.

“If the government is to achieve their stated goal of ‘levelling up’, they need to look carefully at the impact their reforms are having.

“Schools’ success in helping children to recover from the impact of the pandemic depends on the funding and resources they are given by government. Those who need the most help, need to receive the most funding.

“Next week’s Spending Review is a moment of truth for this government. The priority they give education and support for deprived families will reveal clearly whether their rhetoric has any substance.”

PAC report conclusions and recommendations 

The Department’s continued failure to finalise the SEND review means children with SEND are still waiting for much needed improvements in support. In September 2019, the Department announced a major review of support for children with special educational needs and disabilities (SEND). In May 2020, we concluded that many children with SEND were being failed by the support system and recommended that the Department should, as a matter of urgency, complete and publish the review. In March 2021, the Department told us that it would publish a Green Paper with its proposals for change towards the end of June 2021. However, in July 2021, the Department wrote to tell us that it needed more time to develop its plans. It says that it has extended the timetable for the review in order to ensure that its plans take full account of the changes caused by the pandemic, and that it cannot commit to a revised publication date. It is therefore still not clear how the Department plans to improve the SEND system and make it more sustainable, and when practical changes will be made. 

Recommendation 1: The Department should write to us, within a month of this report being published, with details of the progress it has made towards finalising the SEND review and setting out when it now plans to publish the review. 

Under the national funding formula, schools that are more deprived have fared worse than those that are less deprived. In 2018-19, the Department introduced a national funding formula with the aim of allocating school funding more transparently, consistently and fairly across the country. The new formula has made allocations more transparent and consistent, but it has also led to a re-balancing of funding away from more deprived schools towards less deprived schools. Between 2017-18 and 2020-21, average per-pupil funding fell in real terms by 1.2% for the most deprived fifth of schools, but increased by 2.9% for the least deprived fifth. The Department highlights that funding allocations have been catching up with changes in patterns of deprivation across the country since the early 2000s. However, the relative re-distribution of funding is also the result of the Department introducing minimum per-pupil funding levels, which have benefited the least deprived schools. In July 2021, the Department began a consultation on moving to a ‘hard’ national funding formula under which it would set schools’ budgets directly.

Recommendation 2: Before moving towards a hard national funding formula, the Department should publish an assessment of the likely impact of the proposed changes on individual schools and different types of schools. 

It is not possible to tell whether individual academy schools are receiving the government’s guaranteed minimum per-pupil funding levels. In 2018-19, the Department introduced minimum levels of schools block per-pupil funding for all schools in England. In January 2020, the Prime Minister guaranteed that every school would receive minimum funding of £3,750 per primary pupil and £5,000 per secondary pupil in 2020-21. Local authorities are legally required to ensure that their maintained schools receive the minimum per-pupil funding levels. By contrast, multi-academy trusts are allowed to pool funding centrally, and do not have to provide each of their individual academy schools with the minimum per-pupil funding. We asked how parents would know whether their child’s academy school has received the minimum funding levels. The Department says that the schools financial benchmarking website provides a range of data on income and spending for individual academy schools. However, we note that the website combines funding from a range of sources, and does not show specifically the schools block per-pupil funding that each academy receives. 

Recommendation 3: The Department should publish each year, starting with the year ending 31 August 2021, details of the schools block per-pupil funding that each academy school has received. 

Schools are having to cross-subsidise their sixth forms with funding intended to support younger pupils. Between 2014-15 and 2020-21, the balance of funding shifted from secondary schools to primary schools. Secondary school funding per pupil dropped by 3.9% in real terms, while primary school funding increased by 4.2%. Part of the reason for this was that the Department reduced funding per sixth-form student, which fell by 11.4% in real terms. The Department concedes that it chose to prioritise funding for children aged 5 to 16. Local authorities have also protected funding for primary schools. The Department accepts that 16-to-19 education is facing challenges, and that some schools cross-subsidise in order to keep their sixth forms going. It has increased funding for students aged 16 to 19 in the past two years, in order to start redressing the balance. 

Recommendation 4: In making and communicating decisions about school funding, the Department should explicitly consider how different funding streams interact so that schools do not have to cross-subsidise, for example, in order to support sixth-form provision. 

The Department does not seem to have a grip on the impact of falling rolls on schools. Most school funding follows the pupils – under the national funding formula, the Department allocates nearly three-quarters of schools block funding on the basis of pupil numbers. We know of schools whose rolls are falling due to changes in their local populations. These schools still have to cover their fixed costs, but are seeing their funding fall significantly. The Department highlights that there is a ‘falling rolls fund’ that local authorities can use to help schools in this position, and that the national funding formula provides a lump sum for each school regardless of size. However, the Department does not appear to have a strong understanding of the practical financial impact of falling rolls on individual schools. 

Recommendation 5: The Department should carry out an evidence-based assessment of whether there is enough support for schools whose rolls are falling, and write to us by the end of March 2022 with an update on the results of its assessment and what it is doing to address any concerns. 

The Department cannot say when it will implement its commitment to a starting salary of £30,000 for new teachers. In September 2019, the Government set out its intention that salaries for new teachers would rise to £30,000 by September 2022, in order to improve the competitiveness of teacher pay. In February 2021, it told the School Teachers’ Review Body that it had paused planned pay rises for teachers in 2021/22, and that starting salaries would not reach £30,000 by September 2022. The Department says that it will not be able to confirm until after the next Spending Review when its commitment to a starting salary of £30,000 will be implemented. For several years, the Department provided separate grants to help schools cover increases in teachers’ pay costs and higher pension and national insurance costs. However, from 2021-22, it is incorporating most of this funding within the dedicated schools grant, making the funding less transparent. 

Recommendation 6: The Department should set out a timetable for meeting its commitment to a £30,000 starting salary for teachers, along with details of how this will be funded. 

You may also be interested in these articles:

Sponsored Video

Register, Login or Login with your Social Media account:


Upcoming FE Events

Advertiser Skyscrapers

Latest Education News

Further Education News

The FE News Channel gives you the latest education news and updates on emerging education strategies and the #FutureofEducation and the #FutureofWork.

Providing trustworthy and positive Further Education news and views since 2003, we are a digital news channel with a mixture of written word articles, podcasts and videos. Our specialisation is providing you with a mixture of the latest education news, our stance is always positive, sector building and sharing different perspectives and views from thought leaders, to provide you with a think tank of new ideas and solutions to bring the education sector together and come up with new innovative solutions and ideas.

FE News publish exclusive peer to peer thought leadership articles from our feature writers, as well as user generated content across our network of over 3000 Newsrooms, offering multiple sources of the latest education news across the Education and Employability sectors.

FE News also broadcast live events, podcasts with leading experts and thought leaders, webinars, video interviews and Further Education news bulletins so you receive the latest developments in Skills News and across the Apprenticeship, Further Education and Employability sectors.

Every week FE News has over 200 articles and new pieces of content per week. We are a news channel providing the latest Further Education News, giving insight from multiple sources on the latest education policy developments, latest strategies, through to our thought leaders who provide blue sky thinking strategy, best practice and innovation to help look into the future developments for education and the future of work.

In Jan 2021, FE News had over 173,000 unique visitors according to Google Analytics and over 200 new pieces of news content every week, from thought leadership articles, to the latest education news via written word, podcasts, video to press releases from across the sector, putting us in the top 2,000 websites in the UK.

We thought it would be helpful to explain how we tier our latest education news content and how you can get involved and understand how you can read the latest daily Further Education news and how we structure our FE Week of content:

Main Features

Our main features are exclusive and are thought leadership articles and blue sky thinking with experts writing peer to peer news articles about the future of education and the future of work. The focus is solution led thought leadership, sharing best practice, innovation and emerging strategy. These are often articles about the future of education and the future of work, they often then create future education news articles. We limit our main features to a maximum of 20 per week, as they are often about new concepts and new thought processes. Our main features are also exclusive articles responding to the latest education news, maybe an insight from an expert into a policy announcement or response to an education think tank report or a white paper.

FE Voices

FE Voices was originally set up as a section on FE News to give a voice back to the sector. As we now have over 3,000 newsrooms and contributors, FE Voices are usually thought leadership articles, they don’t necessarily have to be exclusive, but usually are, they are slightly shorter than Main Features. FE Voices can include more mixed media with the Further Education News articles, such as embedded podcasts and videos. Our sector response articles asking for different comments and opinions to education policy announcements or responding to a report of white paper are usually held in the FE Voices section. If we have a live podcast in an evening or a radio show such as SkillsWorldLive radio show, the next morning we place the FE podcast recording in the FE Voices section.

Sector News

In sector news we have a blend of content from Press Releases, education resources, reports, education research, white papers from a range of contributors. We have a lot of positive education news articles from colleges, awarding organisations and Apprenticeship Training Providers, press releases from DfE to Think Tanks giving the overview of a report, through to helpful resources to help you with delivering education strategies to your learners and students.


We have a range of education podcasts on FE News, from hour long full production FE podcasts such as SkillsWorldLive in conjunction with the Federation of Awarding Bodies, to weekly podcasts from experts and thought leaders, providing advice and guidance to leaders. FE News also record podcasts at conferences and events, giving you one on one podcasts with education and skills experts on the latest strategies and developments.

We have over 150 education podcasts on FE News, ranging from EdTech podcasts with experts discussing Education 4.0 and how technology is complimenting and transforming education, to podcasts with experts discussing education research, the future of work, how to develop skills systems for jobs of the future to interviews with the Apprenticeship and Skills Minister.

We record our own exclusive FE News podcasts, work in conjunction with sector partners such as FAB to create weekly podcasts and daily education podcasts, through to working with sector leaders creating exclusive education news podcasts.

Education Video Interviews

FE News have over 700 FE Video interviews and have been recording education video interviews with experts for over 12 years. These are usually vox pop video interviews with experts across education and work, discussing blue sky thinking ideas and views about the future of education and work.


FE News has a free events calendar to check out the latest conferences, webinars and events to keep up to date with the latest education news and strategies.

FE Newsrooms

The FE Newsroom is home to your content if you are a FE News contributor. It also help the audience develop relationship with either you as an individual or your organisation as they can click through and ‘box set’ consume all of your previous thought leadership articles, latest education news press releases, videos and education podcasts.

Do you want to contribute, share your ideas or vision or share a press release?

If you want to write a thought leadership article, share your ideas and vision for the future of education or the future of work, write a press release sharing the latest education news or contribute to a podcast, first of all you need to set up a FE Newsroom login (which is free): once the team have approved your newsroom (all content, newsrooms are all approved by a member of the FE News team- no robots are used in this process!), you can then start adding content (again all articles, videos and podcasts are all approved by the FE News editorial team before they go live on FE News). As all newsrooms and content are approved by the FE News team, there will be a slight delay on the team being able to review and approve content.

 RSS IconRSS Feed Selection Page