Primary Finance report
eCAPH concerns over schools’ budgets 2020-21
Final outcome from 10th February 2020
Thank you to primary colleagues who supported the eCAPH recommendation below, to support Option 2 unanimously in the Feb consultation, but unfortunately, yet again, our voices we were ignored.
Borough Officers had briefed Councillor Flavell to support Option 4; our Director was determined to direct this funding to support SEN even though this can’t be insisted up on as this is general funding. This funding should have always gone via Basic Entitlement - average weighted pupil unit (AWPU) and there should never have been any debate.
Unfortunately, our secondary colleagues did renege on their support for extra funding to come to only the primary sector. Primary representatives protested strongly on your behalf, even suggesting a fifth option of sharing £1.1m equally between all children, but were ignored.
The decision was made by Councillor Flavell to support Option 4.
What this means to your budget
The formula factor for Low Cost High Incidence SEN (LCHIS) will increase. The current values under NFF for the Low prior attainment factor under NFF per primary child is £1,068.86; for a secondary child it is £ 1,615.83. Why it requires 34% more to educate a SEN child in secondary is at the whim of Government?
The result is an increase of £1,197,005 for primary, supporting 8,647 SEN children; an increase of £862,507 for secondary supporting 4,121 SEN children; less than half the primary children with 34% more funding.
Budget outcome - The positives
Now only 46 primary schools have been removed from MFG; a reduction of three primary schools and one less secondary school.
The MFG pot for schools with high levels of historical deprivation has been reduced to £221,158 (a reduction of £108,000) and now supports only 5 primary schools (a reduction of 3); two schools still receiving £188,580 but a reduction of £34k.
The MFG burden is now shared between 62 primaries, rather than 46, and 13 secondary schools which is a great improvement. The overall MFG cost is also reduced by £154,608.
The 46 primary schools removed from MFG will see no increase in their MPPF, although formula factors could have changed significantly, the overall MPPF will remain as it was before the extra delegation of £1.1m.
65 primary schools, 52%, are still below the MPPF of £4000 set for April 2021 so there is a massive shortfall in funding and an increased potential MFG issue created.
The reduction in overall MFG of £154,608 means that this funding has moved from primary budgets to secondary budgets; increasing further the differential. This too increases potential MFG issues, as the final MPPF differential at April 2021 needs to be £5000 secondary and £4000 primary; 55% to 45%.
From the extra £1.1m, total Schools Baseline Budget 2020-21 will increase by £535,712 primary; £588,914 secondary. There are 10,000 more children in primary education, 20% more than secondary in Cheshire East this year.
Considerable improvement in funding for secondary schools at the expense of primary schools.
63% of primary schools will see an improvement in per pupil funding. This has helped 70% of small rural schools but that leaves 30% with no increase. It also hasn’t provided any improved funding in 30% of our most deprived primary schools.
This decision has increased further the funding differential per child between primary and secondary. This an unfair way to distribute more funding and is bias toward the secondary sector as they receive a higher unit value.
It hasn’t improved primary MPPF, something our secondary colleagues supported at Forum and it will cause unexpected issues with MFG in next year’s budget.
This is because any change in formula factors impacts on MFG next year. eCAPH can't imagine there will be extra funding to make similar large increases in Low Cost High Incidence SEN formula factor funding April 2021 as any extra funding will go to meeting increases in primary MPPF. This means that the funding factor differences between years will trigger high MFG top-up funding. This could have all been avoided if funding had been paid through Basic Entitlment.
eCAPH response to 14th February Consultation:
Cheshire East Schools Funding Formula 2020/21, Update post Schools Forum of 6th February 2020
All primary schools need to urgently respond by indicating Option 2, emailing firstname.lastname@example.org our School Forum Rep and copying in Tim Moreton email@example.com in Finance by noon on Tuesday 18th February together with any other comments.
Martin Casserley will be attending a meeting on 9:30am Wednesday 19th February with Cllr Flavell, portfolio holder, to find a resolution.
First, good news; well it’s all good news, of sorts, because it’s more money.
The failure of the Borough to transfer of £1.1m from the schools block to high needs block has been refused. The reason given, is that they already have had an additional 8% for high needs funding provided. This means £1.1m needs to be added back to the schools funding total.
Secondly, the disapplication to increase primary minimum per pupil funding (MPPF) to £3,843 was successful!
We now need to consider how this £1.1m is allocated back to schools. There are 49,349 children in total which would mean £1.1m shared equates to £22.29 per child.
In theory, this money should have been paid to schools via Basic Entitlement - average weighted pupil unit (AWPU).
This makes up the largest proportion of a school’s budget. Increasing this by £22 should improve budgets by:
- Putting more per pupil funding in to a school’s budget
- Making a school budget closer to the plus 0.5% minimum funding guarantee (MFG); thus, reducing the top-up funding required; thus, reducing the top-slicing on other schools to provide this.
- Make the MPPF for a school closer to the target set, which would reduce the top-up required
- Allow more schools to achieve the MPPF target in the first place, which would mean they don’t need top-up; which would leave them in the ‘pool’ of schools sharing the burden for MFG, reducing the overall shared cost per school.
Disappointingly, increasing AWPU by £1.1m was never model by the Borough because they were so sure they would gain the disapplication from DfE.
The best option for primary sector, because it increases funding to all Primaries, is option 2 - Increase the Primary AWPU factor only. This would provide £1.1m shared across 29,317 primary children equating to £37.52 per child. It would significantly reduce MFG scaling too thus helping smaller more rural schools who have been hit hard by current modelling. There was agreement by secondary colleagues at December’s School Forum to do this but it would need their ratification on Wednesday.
The next best option would be option 1 - Further increase the Primary MPPF factor but this apparently requires a new disapplication which could delay issue of funding data. Making budget publication late isn’t popular and this option doesn’t help smaller more rural schools as much.
The third option (and if secondary colleagues renege on their agreement, the only option) would be option 3 - increase all the AWPU factors by £22. This was unanimous in the consultation and agreed at School Forum but with the proviso of Local Formula. All schools would benefit to a lesser extent and it would significantly reduce MFG scaling. However, this would unfairly increase the primary: secondary differential even more and could cause more turmoil in MFG next year.
Option 4 - Increase the Low-Cost High-Incidence for both phases is not equitable and so not worth considering. Schools could choose to use extra funding received to fund this anyway. This isn’t NFF either so if we’re considering a local formula option then there are a number of other ways this could be resolved.
Outcome from Cabinet meeting 4th February 2020
Cabinet voted to support all the proposals, previously shared, at their meeting on the 4th February. They delegated powers to the new Portfolio Holder Councillor Flavell to decide how any further funding would be allocated if the DfE refused to grant the disapplication.
The good news is that the DfE did refuse the Borough’s application to remove £1.1m from Schools Block to the High Needs Block. The decision as to how this £1.1m would be allocated to schools then fell to Councillor Flavell. There was a very rushed consultation sent out on the last day before ½ term outlining four options.
eCAPH reflection January 2020
Having read through the vey recent information sent out by Steve Reading and Cheshire East Finance team, eCAPH still have a number of concerns before this is presented to Cabinet 4th February 2020.
Whilst the modelling has increased the minimum per pupil funding (MPPF) for primary schools by £93, there is still no additional money overall in the primary sector than there would have been under the Local Formula option, voted unanimously for in the recent Consultation.
In the Cabinet papers for February 2020, 1.5.2 – School Forum did not agree to using NFF as stated. The primary sector supported our colleagues’ views, expressed through the consultation, and want the Local Formula. Adding an extra £93 MPPF does not negate how primary School Forum members wanted this money to be distributed – via our Local Formula as this represents continued financial continuity and security for our sector.
The increase in primary MPPF, masks the re-distribution via NFF formula. This has re-distributed funding to primary schools with high deprivation, at the expense of our smaller and/ or rural primary settings.
With the increase funding, £25 per pupil announced for disadvantaged through Pupil Premium, why do we need to take money off the majority of our Cheshire East schools to increase formula deprivation funding? Yet again, our small rural schools, with low deprivation, will be facing budget reductions; an unfair burden on an already struggling sector.
Minimum funding guarantee (MFG) has caused further chaos.
Since the cost of MFG has increased by 1% from last year, eCAPH warned that this would cause further unplanned financial turmoil. In setting a higher MPPF, the larger primary schools (with 52% primary children; 49 out of 124 schools), and most larger secondaries (with 63% secondary children; 11 out of 23 schools), have been removed from MFG calculations! This means the increased financial burden of MFG is now being born by the remaining smaller primary schools with less than 200 children.
Most of the MFG pot, £329,660, continues to support 8 primary schools with high levels of deprivation; paid for by reducing the budgets of the remaining 46 primary schools by £320k. This problem was created a number of years ago when deprivation formula factors were ‘adjusted’ in our local formula. These large deprived schools are now receiving triple funding for deprivation – pupil premium, NFF deprivation formula funding and continued historical MFG. This year’s proposed MFG adjustment payment is equivalent to an extra £150 per child in just 8 primary schools.
Primary sector School Forum colleagues did not agree to the current budget being promoted to Cheshire East Cabinet. This was not clearly defined at our last School Forum meeting. The discussion was to move toward £4000 MPPF; still nowhere near the £4200 which was the bare minimum required to run a primary school in 2018. This has not been achieved in this budget by offering only £93 per child extra and masked by a positive MFG adjustment 0.5%. Our concerns and warnings with regard to financial consistency and budget stability have been ignored. The burden of this budget manipulation is now going to be inflicted on 46 of the smallest schools who can least afford it.
With regard to transferring £1.1m from Schools Funding to High Needs funding; all School Forum members and the Consultation from all sectors voted NOT to support this.
The reason this wasn’t supported, is because the transfer represents £22 of per pupil funding. This is needed to support our failing, underfunded, main school budgets; particularly in the primary sector. This funding would remain in a school’s budget and be spent on the education of all children. Schools can no longer ‘afford’ the luxury of donating £1.1m of general school funding, to prop-up the £40m targeted High Needs budget.
Whilst all schools appreciate the pressure on High Needs, we are also facing unprecedent pressure in our main school budgets. Retaining this funding in schools will mean it is not ring-fenced, allowing schools to decide how best to spend this on our children; schools may still use this funding to support special needs.
The £40m High Needs budget supports Cheshire East children with SEND. However, only a £5.5m of this is returned to CE main-stream schools to support High Needs via top-up funding.
Cheshire Officers are ignoring School Forum recommendation and, according to Cabinet paper 1.5.6, are recommending the Council apply directly to the DfE to seek permission to transfer the funding anyway. The application has already been submitted to the DfE on 16th January. This supersedes any Cabinet decision. We were all consulted however this consultation was disregarded; so much for the democratic process.
As eCAPH members we need to be making national political representation if the Council agree to forcibly removing £1.1m of school budget funding to support High Needs. Council voted to support the budget as proposed at the Cabinet meeting.