Ending the ‘postcode lottery’ – the new National Funding Formula

Ending the ‘postcode lottery’ – the new National Funding Formula

Last week, the Department for Education published details of the new National Funding Formula (NFF) to be rolled out next year. The NFF, described as a fairer funding system, promises to end the ‘postcode lottery’ historically associated with school funding in England.

The NFF proposes to base school funding on the individual needs and characteristics of individual schools; meaning that similar schools may no longer receive dissimilar levels of funding.

So how might schools benefit? The NFF intends to increase the basic amount allocated for every pupil, as well as introducing a minimum per pupil funding level for both secondary schools (£4,800) and primary schools (£3,500) to target the lowest funded schools. The NFF also promises a minimum cash increase for every school of 1% per pupil by 2019-20, with the most underfunded schools guaranteed rises of 3% per pupil in 2018-19 and 2019-20. A £110,000 lump sum will also be allocated for every school to help with fixed costs, as well as an additional £26m set aside for rural and isolated schools to help them manage their unique challenges.

According to Department for Education statistics, secondary schools will be the biggest winners of the new NFF, experiencing an average funding boost of 4.7%. This figure is closely followed by a predicted average gain of 3.9% in rural schools (the most remotely located may see a 5.0% increase) and schools with a high number of pupils starting with low attainment set to gain 3.8%.

Reforms to funding for children and young people with high needs have also been confirmed. The government promises every local authority will see a minimum increase of 0.5% per head in 2018-19, going up to 1% in 2019-20. This could see average gains for local authorities’ high needs budgets of 4.6%.

The NFF is set to be introduced in April 2018. However, local authorities will continue to make decisions on allocations to individual schools until 2020.

For further information, background and the principles of the new NFF, the Department for Education policy paper can be found here.