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School Budgets 2003–04

Volume 404: debated on Tuesday 6 May 2003

The text on this page has been created from Hansard archive content, it may contain typographical errors.

On Friday 2 May I published a detailed analysis of the school budgets of local education authorities for 2003–04, based on authorities' own statements. I have placed in the Library copies of the table of analysis, an explanatory note on the analysis, and a table showing cash increases in funding by LEA since 1997–98.The analysis reveals the following eight issues:

Nineteen LEAs appear not to be passporting the full increase in education resources they received from Government into their Schools Budget. Eight of these authorities said they would passport in full in January. In total this means that schools in these authorities will not have the benefit of £23 million which the Government intended for schools;
One hundred and twenty-five LEAs are increasing the funding for the pupil services they pay for centrally faster than they are increasing the funding for individual schools. In total schools are getting £235 million less than a proportionate share of the increased resources;
There are big variations in the increases that LEAs are making in their funding of Special Educational Needs. Forty-five LEAs have increased funding in this area by more than 30 per cent. while 33 LEAs have only increased their spending by 5 per cent. or less;
Half of authorities have increased their spending on educating pupils outside school, for example in Pupil Referral Units, by 30 per cent. or more. Increases may be justified by local circumstances, but will have an impact on individual schools' budgets;
Forty per cent. of authorities are diverting more than £1 million from revenue budgets into capital spending, at a time when dedicated capital funding from central Government for schools continues to rise significantly, year-on-year;
Over two thirds of LEAs are holding over £100,000 for contingency purposes. This will have an impact on schools' financial planning, if they do not know this money is there. The amount being held in contingency funds across the country amounts to £64 million;
Five hundred and thirty-three million pounds which LEAs have specifically ear-marked for individual schools' budgets had not been allocated to schools at the point that their statutory statements were made to DfES. A fifth of authorities still had more than £5 million to allocate to schools, and some much more than this. There may be good reasons for this and we know that some authorities are now in the process of allocating these funds;
Within many LEAs, there are big variations between the budget increases of individual schools. This means that some schools are getting funding increases 10 percentage points more than other schools in the same authority.

My Department has written to all LEAs to ask questions about their spending decisions: the questions asked of each LEA reflect the extent to which it is affected by the eight issues above. We are also asking LEAs to set out the steps they are intending to take to avoid any needless redundancies of teaching staff because of funding issues. LEAs have been asked to reply by 12 May.

In the light of the information that LEAs provide I shall consider what changes to make regarding funding arrangements for 2004–05.