Education Funding: Cheshire

I beg to move,

That this House has considered education funding in Cheshire.

It is a real pleasure to serve under your chairmanship, Mr Hosie, and I am grateful to the Minister for being present to respond to this important debate. I am also grateful to the Secretary of State for agreeing to meet headteachers in my constituency, and I am delighted to be joined by my hon. Friends the Members for Congleton (Fiona Bruce) and for Eddisbury (Antoinette Sandbach), who share my concerns about this important matter—I know that there might not be enough time for my hon. Friend the Member for Congleton to make a full speech, because this is only a short debate. I also notice that friends from across the House are present, including the hon. Member for City of Chester (Christian Matheson).

I acknowledge the support that has been provided nationally to date, including the £1 billion increase in funding, the extra support for teachers’ pay and pensions and for capital spend, and the increase in overall education funding since 2010. However, increases in costs are outstripping that extra funding, and there are discrepancies and differences in school funding in different parts of the country. The funding of Cheshire’s schools is, and will be, seriously negatively impacted by its geography, rurality and perceived needs, or lack of needs. We will explain some, and hopefully most, of the key issues in the time that we have, so that if the Minister does not have time to go through everything, he will be able to meet us and address those funding shortcomings.

First, Cheshire East Council is considering its three-year budget forecast to 2020-21 and its calculations for its maintained schools, and it says that by March 2021, 50% of maintained schools in the borough will be reporting a deficit in excess of £100,000. The total forecast deficit will equal £9.2 million—that is 10% of those schools’ funding—which will affect 38 schools in the borough. Cheshire’s national funding formula consultation identified cost increases of 8% from 2016-17 to 2019-20, but funding in Cheshire East has only increased by approximately 2%. As the lowest-funded authority, our schools already have lean budget plans, which makes addressing those pressures even more challenging than in other areas. The current national formula is shifting resources away from areas—such as Cheshire East—with relatively low deprivation levels, reducing basic funding levels and not leaving enough to run the schools.

Under those conditions, it is not possible in Cheshire East to meet the headline minimum per pupil levels in all cases. Where school deficits are exceeding £100,000, schools will have to look at reorganising, whether that means creating federations or possibly closing. That will not meet the needs of families and children in Cheshire East, because the money will be diverted into transportation to get children to their schools. The pressures on special educational needs services continue to grow, particularly given the contribution of £6,000 that schools need to make. I have been told that because of that contribution, some schools might refuse to take children with special educational needs, or that schools that are all-inclusive and do accept those pupils will face an extra strain on their budget.

Presumably, the right hon. Lady was sitting at the Cabinet table in July when the latest school funding formula was discussed. I do not know whether she made representations to the Chancellor at the time, or even pressed the Cabinet for a vote, as there are well-documented claims that she did in the case of Brexit. We share some of her analysis of school funding cuts, but this matters when it comes to the Division Lobby, and in the right hon. Lady’s case, when it comes to her collective responsibility as a member of the Cabinet.

As the hon. Gentleman will know, the fact that the extra £1 billion was put in place was particularly due to the pressure applied by my hon. Friends the Members for Congleton and for Eddisbury. As I only returned to the House at the 2017 election, I too applied pressure, because I think it is vital that schools get the money they need for education. For me, education is one of the key building blocks of social mobility that every child needs, so I did indeed make sure that we pressed for further funding. I would like that to be on the record.

Does my right hon. Friend agree that the pressure that was put on by my hon. Friend the Member for Congleton and myself, and indeed by other hon. Members who met with the Minister to ensure that a minimum level of funding was applied, resulted from the particular problems in Cheshire East and Cheshire West and Chester? Does she also agree that those problems are linked to the formula by which rurality is calculated, which is as the crow flies, rather than as the car or bus travels?

My hon. Friend is correct in what she says and in the work that she has done. I am glad that I have entered the House again, enabling me to unite with my friends and push these important points.

Will the right hon. Lady give way?

If the hon. Lady does not mind, I will continue a little bit further, because I do not have much time. This is only a 30-minute debate, and I know the Minister has to respond, so I want to raise a couple of key points about Cheshire West and Chester. However, I know that the hon. Lady has done a lot in this area, and has a lot of knowledge about it.

The key challenge in Cheshire West and Chester is that it is funded below the average of all local authorities, due to the emphasis in the national funding formula on funding areas of deprivation and areas with higher living costs. Under that formula, Cheshire West and Chester is funded at the minimal level of funding for all local authorities for early years provision, meaning provision for three and four-year-olds. In 2018-19 and 2019-20, Cheshire West and Chester has received the minimum 0.5% increase in school core funding, but in the same period, local government officers’ payment bills have increased by 5.6% and teachers’ pay costs have increased above the anticipated public sector pay cap. Spending is outstripping the funding that is going into that area, and as a result, Cheshire’s primary schools are now 44% less funded than London’s primary schools and its secondary schools are 49% less funded than in London.

My key questions to the Minister are as follows. Will he commit to look again at rural funding and address the discrepancy? Does he accept that the increase in costs is outstripping the increase in funding? Will he provide support when local authorities have to use independent schools to meet specific needs? Will he support Cheshire in creating additional special educational needs places, and provide capital investment to enable that to happen? Will he also look at the apprenticeship levy and whether it needs to be applied to schools, and if that is the case, make sure that the levy can be used in a wider context—maybe training, rather than just apprenticeships? Will he ensure that in the forthcoming spending review, he applies for more funds for the Cheshire area, now that he understands the discrepancies in funding in that area?

I thank my right hon. Friend the Member for Tatton (Ms McVey) for allowing me to contribute to the debate, which we applied for jointly.

Before the debate, I wrote to every primary and high school headteacher in my constituency. All seven senior school headteachers, whether in free schools, academies or multi-academy trusts, sent a collective response stating that they cannot remember morale being so low, the main reason being the lack of funding into schools, and that standards—high in Cheshire East—will be adversely affected.

The heads asked me to bring four key messages to Parliament. I will quote their words, which are strong:

“The Government must stop misleading the country by stating that record amounts are being spent on education when”,

according to the Institute for Fiscal Studies, since 2010, in Cheshire East

“the amount spent per child has fallen in real terms by 8%.”

Secondly, they say:

“The Government must commit to an index linked approach to the national formula so that all schools are able to deal with changes that are outside of their control, such as increased employer NI and pension contributions”,

as well as underfunded pay awards and other cost pressures. They say that there has been a 10% rise in staff costs in our schools since 2017 alone. Their third and fourth points are:

“The Government must demonstrate that every school in the country will gain enough funding via the Age Weighted Pupil Unit to run a school regardless of the characteristics of its pupils.

The Government should provide a long-term commitment to educational funding in a similar manner to the National Health Service.”

It is a pleasure to serve under your chairmanship, Mr Hosie, I think for the first time.

I congratulate my right hon. Friend the Member for Tatton (Ms McVey) on securing the debate. I pay tribute to her and to my hon. Friends the Members for Congleton (Fiona Bruce) and for Eddisbury (Antoinette Sandbach) for the way in which they have, over the past few years, brought the issue of school funding in their area to the Department, to me personally and to the Secretary of State. If I may say so, they have had a significant influence on the way in which the national funding formula has been implemented—

And the rest!

Will the Minister give way?

I will not give way, because of time, but I was about to say that Opposition Members have also brought the issues to the Department’s attention. I pay tribute to them, too, and to other hon. Friends who are not present at the debate.

This Government are determined to create a world-class education system that allows every child to achieve their potential, regardless of who they are or where they live. As well as improving standards and supporting teachers, we are investing money in our schools and helping them to make the most out of every pound they receive. We are also delivering on our promise to make funding fairer. The introduction of the national funding formula, the biggest reform of the school funding system for a decade, means that we are now directing money where it is most needed, based on schools’ and pupils’ needs and characteristics.

I want to start by emphasising the significant progress we are already making towards creating a world-class education system, thanks in part to our reforms: the attainment gap between rich and poor is shrinking; the proportion of pupils in good or outstanding schools has increased from 66% in 2010 to 84% now; and our primary school children have achieved their highest ever score on international reading tests. We have also launched 12 opportunity areas to drive improvement in parts of the country that we know can do better.

The Minister mentioned the improvement in standards. One example is the Sound and District Primary School, which improved the proportion of pupils achieving at key stage 2 from 70% in 2017 to 83% in 2018. Will the Minster deal with the suggestions about the index-linked approach and the age-weighted pupil unit funding that is the core of funding for every school, regardless of its particular characteristics, which my hon. Friend the Member for Congleton raised?

I will come to that point. I am sure other hon. Members would like to raise that as well.

To support the improvements in standards, and because children get only one chance of a great education, the Government have prioritised school spending, even while having to make difficult decisions on public spending in other areas. We have invested an extra £1.3 billion across 2018-19 and 2019-20, as referred to by my right hon. Friend the Member for Tatton, over and above existing plans set out in the previous spending review, so core funding for schools and high needs will rise from almost £41 billion in 2017 to £43.5 billion in 2019-20. Figures from the Institute for Fiscal Studies show that real terms per pupil funding for five to 16-year-olds in 2020 will be more than 50% higher than it was in 2000.

We can compare ourselves favourably with other countries. The UK spends as much per pupil on primary and secondary state education as any major economy in the world, apart from the United States of America. Although there is more money going into our schools than ever before, we absolutely recognise the budgeting challenges that schools face, and we acknowledge that we are asking schools to do more. That makes it all the more important that we do everything to ensure that we get the best out of every pound that we provide. One aspect of that is ensuring that that money is directed where it is most needed.

For the first time last April, funding was distributed to local authorities based on the individual needs and characteristics of every school in the country, not accidents of geography or history, as had been the case in the previous system, when schools with similar characteristics received very different levels of funding with little or no justification. Those disparities had persisted and grown for nearly a decade and left some schools and areas unable to get the resources they needed. That is why our commitment to reform the unfair, opaque and outdated schools and high needs funding systems was so important. I am very pleased to say that our introduction of the national funding formula delivers on that commitment.

Schools are already benefiting from the gains delivered by the national funding formula. Since 2017, we have given every local authority more money for every pupil in every school, while allocating the biggest increases to the schools that have been most underfunded. By 2019-20, all schools will attract an increase of at least 1% per pupil compared with their 2017-18 baselines, and the most underfunded schools will attract up to 6% more per pupil by 2019-20, compared with 2017-18. On average, schools in Cheshire East, including in the constituency of my right hon. Friend the Member for Tatton, will receive gains of 2.4% per pupil by next year, compared with 2017-18. That will mean an extra £10.4 million in total when rising pupil numbers are also factored in. On high needs, last December we announced that we will provide £250 million of additional funding across England over this financial year and the next. In Cheshire East, it means the local authority will receive an additional £1.6 million across this year and next, on top of the increases that were already promised.

I appreciate what the Minister is saying, but the issue is not only about pupils coming to the end of their time at school. Primary school heads have told me that the base figure of £3,500, which they do not receive, will simply not cover their costs. They say the base cost to run a primary school and serve their pupils is £4,060, so they make the point that the base figure is now insufficient.