The Department for Education’s (DfE’s) universal funding formula is too simplistic and at odds with its efforts to create a fair system, says Sam Ellis. And some schools will suffer as a result.

A sting in the tail?

The DfE is tasked with creating a system that allocates funding on a fair and transparent basis and targets pupils who need it most.

This is admirable, at first sight, and you may be surprised that I have been arguing against it since 2010. The problem is that I am not sure I want a funding system that focuses on the process of allocation; I want one that produces a fair result.

I have been putting the case on behalf of members for two years that ‘fair’ should mean ‘equality of opportunity to deliver’. Unfortunately, in DfE-speak, ‘fair’ seems to mean ‘the same for all’. This is evidenced by their use of a block sum in the revised local formula that is the same for all schools. As a result of repeated pressure, I hope that this frankly mad position can be modified but that is only a hope.

It does not follow that a formula made from factors that appear fair and transparent will produce a fair result. There could be factors or functions missing from the process with unfair consequences. The formula for the swing of a pendulum contains at least one square root and a number that cannot be expressed as the ratio of two integers. Imagine where we would be if the ruling powers since the 17th century had decreed that any mathematical analysis could only contain integers and factors that were simple: a myopic view that parallels what is happening to school funding.

Mathematical modelling

Ministers have decided to limit the number of allowable factors in any local formula to a maximum of 12, and this was before any serious testing at local authority (LA) level took place. Imagine being told to design a metal flying machine and to then be told that it must have feathers and flap its wings because that is what birds do – simply mad! This obsession with process restricts the solution.

The ministerial team is very able but not, it appears to me, in a way that is related to mathematical modelling. I also sense that ministers are certain of their own wisdom. I am reminded of the line from Oliver Cromwell to the Church of Scotland when the Scots formed an alliance with royalty: “I beseech you, in the bowels of Christ, think it possible that you may be mistaken.”

I fully support targeting funding towards pupils who need it most. That is easy to say but difficult to do. The current funding system is seen as inequitable partly because deprivation funding has built up and magnified over the years. The City of London LA gets about £9,372 per pupil while Leicestershire gets about £4,428. Much of the difference is due to historic deprivation factors. There certainly are more challenges and higher costs in the City of London than in Leicestershire but justifying a difference of almost £5,000 per pupil is difficult.

To target additional funding towards those pupils who need it in a fair manner will need a significant redistribution of the current levels. I think any fair distribution basis is beyond a ‘simple and transparent’ formula with a flat rate Pupil Premium.

There is a clear risk in the developing system: Some schools and academies will fail financially because they will not be adequately funded. These will be the ones falling outside of the parameters of whatever formula is devised simply because the formula is predicated on process rather than outcome.

‘School premium’

There is no willingness in the DfE to engage with activity-led funding mechanisms. On that basis, my pragmatic approach is to argue for an ‘other box’. I am advocating a sort of ‘school premium’ to deal with genuine outliers. These will probably be schools that have a geographic need but cannot be sustained by whatever myopic funding formula is used. In that case actually having a fund to ‘buy out the problem’ may well be ‘simple, fair and transparent’, provided that it can be used to support schools that are educationally necessary and not just politically precious.

The consultation on reviewing the proposed funding formula closed on 26 March but I would still welcome members’ views on support for schools that fall outside of the funding mechanisms. The difficulties of funding some schools with a ‘simple and transparent’ formula will, like the poor, always be with us. Please email me at sam.ellis@ascl.org.uk

• Sam Ellis is ASCL’s funding specialist

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