Additional funding will not heal schools in deficit, think tank warns

Additional school funding will not help financially struggling schools, a major think tank has warned.

The report comes after the Government announced it would invest an additional £7.1 billion into schools by 2022/23.

But Reform, the public services think tank, said increasing the budget will not close the gap between schools in surplus and those in deficit unless there is a change in the way funding is delivered.

According to the Department for Education (DfE), funding will be allocated based on need via the national funding formula, rather than on the basis of past spending decisions.

Reform has urged the DfE, however, to follow the former principle after a recent study revealed that distributing “excess” surpluses to schools in the red could wipe out deficits in four out of every five schools in England.

The latest data suggests that 28 per cent of local authority maintained secondary schools and 8 per cent of maintained primary schools were in deficit in 2018-19.

Around 36 per cent of secondary schools and 42 per cent of primary schools, meanwhile, enjoyed “excessive” surpluses last year.

Likewise, a total of 195 academy trusts reported a deficit in 2017-18, compared to 185 the previous year, representing around 6.4 per cent of all trusts.

Commenting on the paper, Reform’s Luke Heselwood said: “Extra cash for schools is welcome, but it must be well spent.

“A universal ‘levelling-up’ approach risks wasting taxpayers’ money, while failing to sufficiently help those schools in financial hardship.”

Responding to the report, a DfE spokesperson said directing funding to schools based on their historic spending decisions would be a “retrograde and unfair approach”.

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