Agenda item

(To receive a report from Mark Popplewell, Head of Finance, Children's Services, which asks for the Forum to consider the Local Authority's funding formula proposals for 2018/19 and direction of travel following the government's implementation of a national funding formula for schools in 2018/19 and 2019/20)

Consideration was given to a report from Mark Popplewell, Head of Finance, Children's Services, which asked the Forum to consider the Local Authority's funding formula proposals for 2018/19; and direction of travel following the government's implementation of a national funding formula for schools for 2018/19 and 2019/20.

In guiding the Forum through the report the Head of Finance, Children's Services made reference to:-

·         The background behind the implementation of the national funding formula;

·         The Local Authority schools block funding – The Forum was advised that through the national funding formula the government's plan was to implement a fairer settlement for each school.  It was noted that the government was planning to transition to the national funding formula through a 'soft ' approach in 2018/19 and 2019/20; whereby Local Authorities would continue to be responsible for calculating schools' funding allocations.  It was noted further that Local Authorities were encouraged to move towards the national funding formula so that schools' allocations were on a sensible trajectory towards the move to a 'hard' national funding formula for 2020/21. 

Table one on page six of the report outlined Lincolnshire's schools overall funding level for 2018/19 through the implementation of the national funding formula compared to other Local Authorities.  It was reported that Lincolnshire continued to remain in the lowest quartile for school funding levels with primary schools overall being the 33^rd lowest funded; and secondary schools being the 37^th lowest out of 150 Local Authorities.  The Forum noted that the implementation of the national funding formula was forecasted to bring in more monies in to Lincolnshire schools by an overall increase of 3.7% in 2018/19; and a 6.6% increase overall in 2019/20 from the current 2017/18 schools baseline, which was a positive picture;

·         The proposed Lincolnshire's schools funding for 2018/19 and direction of travel – The Forum was advised that detailed modelling had been undertaken by the Local Authority to understand the government's proposed national funding formula.  The Local Authority had consulted with mainstream schools including academies on the proposal to replicate the national funding formula in 2018/19, ensuring that schools' allocations were on a sensible trajectory towards the move to the 'hard' formula from 2020/21.  A copy of the consultation document was detailed at Appendix A to the report.  Tables two and three on page 8 of the report provided indicative information relating to the monetary gains planned in 2018/19 at school level for primary and secondary schools using 2017/18 census information through the implementation of the national funding formula;

·         Schools Consultation – The Forum noted that the response rate to the consultation had been disappointing (9% of primary schools and 20% of secondary schools), which might have been caused by the tight timescales placed on the Local Authority due to the government's late announcement and releasing of data.  It was noted that the Schools' Forum had an important role in considering school funding arrangements on behalf of all schools.  The Forum considered the eleven question covering eight subject areas that set out the Local Authority's proposal to replicate the government's national funding formula.  The following comments were raised:-

Questions:-

1a – Do you agree that the Local Authority should adopt the government's national funding formula for both the primary and secondary schools in 2018/19 using the following formula factors and monetary values? – The Forum was supportive and raised no further comments;

1b – Do you agree that the Local Authority should adopt the government's minimum pupil funding level in 2018/19 of £3,300 for primary schools and £4,600 for secondary schools within the funding formula, including replicating the government's approach of excluding premise factors of rates and split-site funding from the calculation? – The Forum was supportive and raised no further comments;

1c – Do you agree with the Local Authority's proposed direction of travel to adopt the government's national funding formula (subject to affordability) during the two year transition period before the hard national formula is applied in 2020/21? – The Forum stated that the formula had overall been well received due to the additional funding coming into Lincolnshire;

2a – Do you agree that the Local Authority should adopt the government's proposal of a 0% MFG per pupil protection in 2018/19? – The Forum was supportive and raised no further comments;

2b – Do you agree that the Local Authority should adopt the government's funding floor proposal for all schools to see a minimum gain of 0.5% of their baseline pupil-led funding in 2018/19? – The Forum was supportive and raised no further comments;

3 – Do you agree that the Local Authority should adopt the government's percentage cap in pupil-led funding of the maximum of either 3% gain on their transitional protection baseline, or 20% of their remaining gains in 2018/19? – The Forum was supportive – One question was asked as to what happened when the gain was in excess of 3%.  The Forum noted that significant gainers would also be capped by 3% in 2018/19 and at 6% in 2019/20 based on the 2017/18 funding baseline.  It was noted further that from Lincolnshire Schools' Forum perspective, the Local Authority would be pushing for a quicker move to the funding formula.  The Local Authority agreed that Lincolnshire schools should be entitled to their gains sooner and would provide representation to the government on this.  It was noted that the Local Authority was required to ensure affordability of the School Block of the Dedicated Schools Grant, which was calculated by the government aggregating schools' notional allocations under the national funding formula.  The Forum also noted that the Children and Young People Scrutiny Committee at its meeting to consider the national funding formula had highlighted the need for lobbying to Lincolnshire's MPs for fairer funding to Lincolnshire schools;

4 – If affordability was an issue in setting schools budgets for 2018/19 based on the government's School Block Local Authority allocation, where would you take the monies from? – No additional comments were made by the Forum.  The Local Authority agreed to ensure school level implications were minimised where possible;

5 – Do you agree that the Local Authority should adopt a primary school rents factor for 2018/19? – The Forum was supportive.  One question was raised whether schools that had building expansions on the site could be supported through this factor.  The Local Authority clarified the position, that the primary rents factor supported rents for ground, building and playing fields for existing site arrangements.  A school wishing to expand would need to consider all costs within its business case before proceeding, and the rents factor would not meet this criteria;

6 – Do you agree that the Local Authority should only adjust the 2017/18 schools baseline by £400 (not £600) for each eligible LAC pupil for 2018/19 protection and scaling purposes? - The Forum was supportive and raised no further comments;

7 – Do you agree that the Local Authority should adopt the rates adjustment for 2018/19 and 2019/20 during the two year 'soft' approach of implementing the national funding formula subject to a further review on affordability from 2020/21?  - The Forum was supportive and raised no further comments; and

8 – Do you agree that the Local Authority should not adopt the mobility factor? – The Forum was supportive and raised no further comments.    

The Forum was advised that from the responses received (Appendix A), that responding schools had been in support of the Local Authority's  proposals to replicate the government's national funding formula in 2018/19 and the direction of travel to adopt the government's 'hard' national funding formula; and

·         Next Steps – School National Funding Formula – The Forum was advised that the Executive Councillor Adult Care, Health and Children's Services would be making a decision to agree the schools funding formula for 2018/19 on 10 January 2018.  The Authority Proforma Tool would then be submitted by the 19 January 2018 to the Education & Skills Funding Agency outlining the 2018/19 Lincolnshire's school delegated funding to ensure compliance with the regulations.  The Local Authority Finance Team would then be providing further information on the implementation of the national funding formula to schools and academies to help with their understanding of the new funding formula.  The Forum noted that the Local Authority had to calculate and publish individual school budgets by 28 February 2018.

Page 10 of the report contained some key factors which needed to be considered following the implementation of the national funding formula including the speed of which gaining schools would be funded directly by the national funding formula, and the funding levels from 2020/21 including how funding reductions will be managed for schools losing through the 'hard' formula.

During discussion, the Forum raised the following comments:-

·         Lobbying – Officers confirmed that the comments raised by the Children and Young People Scrutiny Committee had included the need to continue to lobby central government for a fairer funding formula for schools as Lincolnshire was still poorly funded;

·         Selected Schools – A question was asked as to whether there was a link between Ofsted grades and additional resources.  Officers confirmed that financial modelling and other school-related factors were considered in the Local Authority process. Financial modelling had been undertaken based on the Local Authority funding formula baseline as opposed to the inclusion of additional academies funding, which was a matter between the Education & Skills Funding Agency and the academy.  It was confirmed that the level of funding for taking on additional responsibilities as an academy were linked to the date of conversion;

·         Confirmation was given that the Schools Block funding would be allocated out fully based to schools, as there was no requirement to hold onto the funding other than the Growth Fund for planned school places; and

·         The Forum raised the point about Lincolnshire's small schools and asked for clarification as to how the Local Authority would support schools that were losing under the implementation of the National Funding Formula.  The Local Authority confirmed that during the two year 'soft' approach all schools would be gaining by at least 0.5% per pupil, however the Local Authority would continue to support schools through its established and internal monitoring arrangements;

·         Some members of the Forum thought that it would be helpful to receive further analysis to show the gains as a percentage of their budget/type of school; and

·         The Forum extended their thanks to the Head of Finance, Children's Services and his team for all their hard work.

Overall, the Forum felt that lobbying needed to continue particularly for smaller rural schools for fairer funding; that support should be given to the eleven schools losing as a result of the fairer funding formula; and that consideration be given to what the Schools Forum could do more in relation to campaigning.

RESOLVED

1.    That the report and comments raised by the Schools' Forum be noted.

2.    That the Local Authority's funding formula proposals for 2018/19 be supported.

3.    That support be given to the direction of travel replicating the government's national funding formula to ensure schools' allocations are on a sensible trajectory towards the move to the 'hard' formula from 2020/21.