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Primary Finance report

Primary Finance report

Feedback on new formula funding model produced by Borough Council 21st January 2019

After making a comparison between the supplied spreadsheets from the consultation ‘appendix-1-model-1-local-model’ & 6th December School Forum ‘model-1b-local-model-mppf-achieved’ (which are the same) and last Monday’s School Bulletin ‘schools-listing-summary-local-model-2019-20’. They can be found here

eCPAH have a few questions which our primary reps would raise but have had no opportunity.

eCAPH Exec members have now met with Finance Officers on 30th January; answers to date are in blue italics.

The Schools Finance team would rather ere on the cautious side when budget setting. They would rather produce a budget model which results in an increase when actuals are known. To this end, some information was not added to the consultation models until it was confirmed by October census data. This has resulted in some bigger changes than forecast.

An extra £3,913,935 since 6th December? We were told to expect a 0.5% increase of £1m. Where did the new funding come from & why?

Budget variance was 0.49% more funding for Cheshire East but now budget variance is 2.39% for 2019/20?

Whilst we welcome the increase in budget, the total primary sector increase is £1,440,842 whilst the total secondary school increase is a massive £2,720,797; not proportional, why not?

We a knowledge an increase of 685 extra children across Cheshire East since the October census; 116 more primary children; 569 more secondary students, a 3% increase. We note this is a reversal of previous years. However, there are still 29,222 children in primary - 10,000 more than educated in the secondary sector at 19,472.

How does this explain the budget variance from 2018/19 to 2019/20, which shows a primary school at 1.23%, which is a welcome increase of 0.8%, but the variance for secondary schools is 3.8% which is a massive disproportionate increase of 3.24%?

Total budget for each sector increased, very welcome – primary £914,605 but again, disproportionally, a secondary increase of £2,999,329? With 30% less children to educate?

Government indicative funding in July 2018 was £1m extra primary level & secondary level PPF. On 17th December Borough received updated DfE census data; overall £5m growth in education funding. £3m extra on pupil growth of 685 new children. This was proportionate to the increase in numbers in each sector.

With such massive shifts in funding between sectors, and MFG agreed to remain at minus 1.5%, we would have expected to see a large swing in MFG adjustment to protect primary budgets. This in comparison to December’s budget model, which had very little change in MFG across & between sectors, to a massive positive swing to secondary's? MFG has taken minus £123,680 from primary & given plus £123,680 to secondary schools? This is a reversal of plus £133,621 from Decembers calculations – that’s taken nett potential of £250,000 off the primary sector!

To achieve MPPF of £4800 for secondary schools, they were taken out of MFG. The top slice was 37% off those schools with growing budgets to offset minimum guarantee that no school loses more than -1.5%. Whilst this wasn't in last years forumlua, secondary MPPF couldn't be achieved without excluding them.  

We would like to know why the rates bill seems to have gone down by £127,174 since December? Difficult to understand what difference a month makes in this calculation? We cannot find ANY year, since Cheshire East came in to being, when the rates bill has gone down? This leads us to wonder, were schools being overcharged in previous years?

This is because of schools converting to academies; as charities, they get a rates reduction of 80%. It wasn't confirmed in December which schools were converting or when. Pointon High, largest high school in Borough, was one of these converters. Big rates bill!

When we analyse the detail of the school block formula factors, for which the formula was supposed to have remained the same, we see:

Assumed to follow the shift in characteristics in each sector; taking account of the ‘new’ numbers moving in to Borough schools. Awaiting further detail as to the breakdown.

• Additional Funding to meet Minimum Funding Per Pupil reduced primary by -£28,659 but increased to secondary by +£21,231? Due to secondaries achieving MPPF

• Low Cost High Incidence SEN changes; a welcome primary increase 10% to £982,036; but a disproportionate secondary increase £222,759 – a 50% increase?

• English as an Additional Language changes; primary increase £1,259 an increase of 4.3%; secondary increase £10,057 a proportionate increase of 52%?

• Very unusual deprivation changes against any previous budge; primary decrease 1% to minus £20,012 could be explained by children moving sector? What is far more challenging to contemplate a secondary increase 10% to plus £207,909?

• Age Weighted Pupil Unit (AWPU) changes; primary increase £224,687; secondary increase £2,419,638 – 10x bigger? This is due to secondaries achieving MPPF of £4800; a 30% bigger increase than primary MPPF.

Ongoing concerns

There were always different age weighted pupil unit, AWPU, values for Reception, Infants, Juniors, KS3 & KS4. This reduced to all Primary, KS3 & KS4 in our local formula. Now the secondary sector is claiming an average £4800 for both KS3 & KS4. This equates to paying 60% more children at an AWPU value of £4800; £1300 a child more than primaries.

In last year’s consultation, 2017, schools were asked to commit to a two-year budget model. School Forum recommend a budget model to Cabinet which would allow some continuity in budget setting for schools. This autumn, School Forum were informed that another budget consultation would take place. The reason offered was that some schools were unhappy with the outcome of last year’s consultation because it only delivered per pupil funding to secondaries of £4500.

The secondary sector argument is, that they campaigned for an extra funding and won an increase of £300 per pupil concession from Government. Secondaries feel that to pay them less in this year’s budget, would make a mockery of the concession they won and would weaken their future argument; that £4800 is still not enough! Primary saw a £200 increase in MPPF from £3300 to £3500. Primaries too have had to face the same increasing cost pressures – national insurance increases, pay rises, grading uplifts, pension increases, inflationary costs – but £100 less per child; further increasing the disparity between sectors.

Schools Forum is expected to recommend a local formula for consideration by Cheshire East Cabinet in February 2019. Since December School Forum, significant changes in budget models has taken place due to the impact of October census information. This has resulted in considerable extra funding and it would seem a dramatic change in formula characteristics. School Forum have not had an opportunity to meet again to discuss the new model recently issued on 21st January. Cabinet are meeting on 5th February and School Forum are meeting two days later on the 7th February.

Minutes of the 6th December School Forum were being quoted in the Schools Bulletin 21st January, along with a publicly published budget model, which claimed School Forum recommendation ‘...of “retaining a local formula and ensuring the minimum per pupil funding level of £4,800 for secondary schools” is being taken to Cheshire East Cabinet on 5th February’. This was the first sight Forum members had of the proposal.

Since the minutes for 6th December School Forum have only just been published, 29th January, and the Forum has not met since, Forum members have been unable to question, confirm or challenge the accuracy of the published model.

It is this unendorsed model which is now being promoted to Councillors in the Cabinet to ratify on the 5th February 2019. School Forum has not been asked for acknowledgment or approval to make this recommendation.

What has happened so far...

Schools were asked, via the consultation in November, as to which model they supported. A massive 80%+ of respondents, voted in favour of leaving the formula unchanged, maintaining funding as last year. When the vote came to School Forum in December, again Forum voted in favour, 10:7, of leaving the formula unchanged. Because the secondary sector objected, everyone else’s views have been completely ignored.

Consultation data was re-interpreted from last year’s consultation, to make the weighting of each vote dependent on the student numbers it represented; the secondary sector vote would carry more weight. This still reported 50% voting in favour; 40%against. It was then attempted to manipulate School Forum to try and silence members from having an open discussion; after objections, luckily this was overturned. The Forum vote was still, 10:7, in favour of option 1; leaving the formula unchanged.

With secondary representatives unhappy with the consultation outcome and the vote at Forum, the Chair, a secondary representative, chose to report that ‘…the vote was split by sector’ – it wasn’t a split vote, even with two primary representatives missing, the majority vote by three more, was for Option 1 - to leave the formula unchanged.

A new suggestion, from the Director of Education, was proposed at the end of School Forum to try and reach a consensus. That Finance Officers should try again to find a new budget model which would delivered £4800 MPPF to secondaries, whilst maintaining the local formula option 1 - 81% via basic, 10% via characteristics, 2.7% via deprivation. School Forum had been told in November, by the same Officer, that this wasn’t possible.

Whilst the national funding formula, NFF, would introduce this massive increase in secondary AWPU, School Forum did not agree to move to NFF. The introduction of NFF has been postponed for another year and some doubt, with BREXIT fall-out etc, if NFF will ever be introduced in its proposed format. Why would we want to move any quicker toward this financial catastrophe for primary education?

eCAPH’s view

The ridiculous immorality of a primary child at age 11 being worth £3500 and two months later, as a KS3 child, still 11 years old, starting secondary education, being worth £4800 is completely unfathomable. Why do primary schools only receive 72% of the funding as a secondary? Primary schools also have to educate children for seven years at this very low funding level; secondaries educate for five years with 30% more funding a year. They are also larger institutions with supposedly great economies of scale.

The recent unfair political pressure comes from secondary headteachers who have been extorting Government and threatening to only open for four days week. According to secondary school calculations, £3500 would only cover 3½ days of high school’s week. Primary school data from 3 years ago, showed the base operational budget for a primary school was £4060; eCAPH are currently updating this base budget cost as we know it will have increased. If this funding formula goes ahead, we can’t see how primary schools can afford to open for five days?

eCAPH’s consistent message on school funding has always been about equity. Every child, regardless of where they live in the country, should receive the same funding. This should be enough for a school to deliver base budget costs; equitable education. Whilst we acknowledge some local-area adjustment, we also believe that children with extra-needs, should also be funded equitably. Unfortunately, government have no idea how much the ‘base budget’ is to actually deliver a child’s education. So, this common-sense approach has never been the case, nor, with the new National Funding Formula, will it become a reality. We need to challenge this short-sighted, un-costed, broken inequity.

Primary education could make a very strong case for more funding than the secondary sector because of the importance of early-intervention, the legal issue of infant class-sizes and the needs of very young children, with minimal communication skills, to be as independent a learner as teenager should be. However, education funding because of its very political nature, has never recognised this need; secondary education seems to have a historical entitlement to more funding.

The primary sector doesn’t ask for more, we would be happy with the same funding received by a secondary school. Our secondary colleagues, plead poverty that they need more funding because they have to provide specialist staff and facilities – science labs, sports halls, art rooms and drama studios. We would ask; are these even being staffed and used effectively?

Are these not the excellent facilities all our children should have access too? Wouldn’t a primary school love to have the funding to afford just one of those specialist facilities? Wouldn’t it get used more thoroughly, more creatively? How much more impact on the learner?

The average, under-funded, primary school has always had to ‘cut their clothe to suit’ the meagre funding provided. We make do; find more creative solutions; pay comparatively less to our excellent staff in order to achieve much better outcomes than our secondary schools.

Many critics continue to outline how secondary education continues to fail our children (the new focus of OfStEd); every secondary child receiving 28% more funding than a primary child. The same, eager, independent, self-resourcing, emotionally-intelligent children who are performing well in our under-funded primary schools. Imagine what our children could achieve with equitable funding; investing in what would be creative change across the whole system?

Unless the primary sector sticks together and makes our feelings felt, with one unanimous voice, we will all lose even more funding.

eCAPH - Stronger Together