Agenda item

(To receive a report from Mark Popplewell, (Head of Finance, Children's Services), which provides an overview of the Government's stage 2 consultation on the National Funding Formula for schools to be implemented in 2018/19)

The Forum gave consideration to a report from Mark Popplewell, Head of Finance, Children's Services, which provided a summary of the schools national funding formula consultation.

The report provided the Forum with background information relating to the schools national funding formula consultation; and provided a link to the consultation document.  It was highlighted that the closing date for the consultation was 22 March 2017; and all members of the Forum were encouraged to get colleagues involved in the consultation.

In guiding the Forum through the report, the Head of Finance, Children's Services made reference to the proposed 13 funding formula factors, as detailed in the report presented; and that the proposed formula was grounded in the current distribution of funding, as opposed to looking at the costs of running a school and understanding the cost of pupil needs.  It was clarified that the schools national funding formula was a re-distribution of schools funding nationally.  Details of the key points from the proposed schools national funding formula were detailed on pages 14/15 of the report.  The main points referred to are summarised below:-

·         That the government intended to maintain the primary to secondary relation in line with the current national average of 1:1.29;

·         Continue to differentiate basic per-pupil funding between primary; Key Stage 3 and Key Stage 4, to reflect the higher cost as pupils progress;

·         Maximise the proportion of funding allocated to pupil-led factors, which will reduce spending on school-led factors e.g. lump sum;

·         That the basic per-pupil factor would distribute 73% of total schools funding, and that 91% of total funding would be allocated through per-pupil factors;

·         That every school would continue to be provided with a lump sum, but that this would be at a lower level than the current national average;

·         That the lump sum rate would be set at £110,000 for all schools;

·         Provide small and remote schools with additional funding;

·         Recognition of the higher salary costs faced by some schools.  It was noted that Lincolnshire schools did not trigger any additional funding through this route;

·         To incorporate an overall 'funding floor'.  It was questioned as to whether this was a sustainable option long term by government;

·         That during the transition period to the hard national funding formula the minimum funding guarantee of minus 1.5% per-pupil would continue to operate providing further stability for schools; and

·         That schools could receive gains of up to 3% per-pupil in 2018/19, and then up to a further 2.5% in 2019/20.

The Forum noted that Lincolnshire currently received a low funded schools block which was used to distribute funding to mainstream schools.  For 2017/18 Lincolnshire's per pupil value was £4,305.40 compare to an England average of £4,618.63.  It was highlighted that the introduction for the national funding formula was positive news for Lincolnshire schools.  Appendix 1 to the report provided the Forum with financial modelling data for Lincolnshire schools on the national funding formula.  The report also provided tables showing the financial impact by Lincolnshire schools prior, and after the application of the funding floor and minimum funding guarantee, and the gains cap.

The report also highlighted the Local Authority's observations from the consultation.  Officers encouraged schools to view information relating to their own schools national funding formula details on their own COLLECT dataset source.

Officers reported that a number of the early wave academy converters received considerable levels of Local Authority Central Spend Equivalent Grant (LACSEG) funding through its General Annual Grant (GAG) arrangement, which would continue to be transitioned out by the Education Funding Agency.  It was highlighted that the government was proposing through the national funding formula changes to use the academies GAG for re-determined baseline (including LACSEG as the basis of funding protection).  The governments proposed 3% 'funding floor' on academy schools re-determined baseline would lock in historical funding, which would ensure that those schools would not lose more that 3% per pupil overall as a result of this formula from its current per pupil level of funding.  Details relating to the financial impact by Lincolnshire Academy schools prior and after the application of the funding floor and minimum guarantee, and the gains cap were show on pages 21 to 23 of the report.

The Forum was also advised that a central block would be created for existing funding streams that were held by the Local Authority for central services.  This funding would cover two distinct elements ongoing responsibilities and historic commitments.  The Forum was advised further that the government would cease to fund historic commitments when contracts came to an end date.  It was noted that the current contract for Broadband services was due to end in October 2019, so after that date, the government was expecting schools to meet this cost from its delegated schools budgets, through the national funding formula.  Officers reported that the Local Authority was currently reviewing the options for broadband services.

During discussion, the following points were raised:-

·         Reasons for schools having a reduction in funding.  Officers confirmed that this would usually be as a result of historical funding arrangements; and

·         Problems with recruiting staff in Lincolnshire, and the costs associated in cases where English is the student's second language, or have no knowledge of the English language.  Officers advised that there was an area cost assist schools in employing staff in certain areas, however, the proposed area cost adjustment failed to recognise the recruitment challenges of rural schools.

Thanks were extended on behalf of the Forum to officers for their informative reports.

RESOLVED

1.    That the report be noted.

2.    That members of the Forum should encourage other colleagues to get involved in the consultation.