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School Budgets: Impact of Inflation

Volume 717: debated on Monday 4 July 2022

This year core school funding increased by £4 billion, which is a 7% per pupil boost in cash terms. I recognise the pressure that rising inflation has created. We are constantly considering what further support we can provide schools to reduce their costs, and any additional support will sit alongside our range of school resource management tools, to help schools save on regular purchases and reduce non-teaching costs.

I recently visited Hall Road Primary School, which was built in the 1920s. It is in a disadvantaged part of Hull, but it provides an excellent education to local pupils. The headteacher told me that rising costs in energy were really hitting his limited budget for the school. Is the Minister willing to meet me to discuss what emergency funding could be given to the school to help it, and also so that I can lobby for a new school building?

As I have mentioned a number of times, the school rebuilding programme will be making announcements about schools that need that, and of course I would be happy to meet the right hon. Lady and hear about the particular conditions in that school. I recognise that much of our school estate faces the challenges of aging buildings, and it is important that we continue to invest to support schools where they can spend to save.

I have spoken to local headteachers who report that due to inflation, staffing costs have increased by 12%, with gas costs increasing by 20%, and electricity by 30%. One headteacher said,

“please ask the Secretary of State what am I supposed to cut in order to meet inflation costs: the mental health first aider we’ve had to recruit because of the backlog at CAMHS, or the resources we’ve had to put into a community kitchen because so many children were going without meals? Should I turn off the heating in the winter, or simply cut teaching staff?”

What would the Minister like me to say to that headteacher?

It is important that we invest to support schools. That is why we are putting in a £4 billion—7%—increase in the funding of schools. The Department also helps schools to get best value from their resources through a range of resource management tools. Those include recommended deals for energy, and support for schools in switching and entering new energy contracts. I encourage schools to engage with that programme, and of course we all want to ensure that those important priorities for schools can be addressed.

Schools are telling us that standstill funding, inflation and rising energy costs mean that they are having to limit the numbers of healthy options in schools meals. The Government agree with Labour that good healthy school meals are essential for children to thrive, especially as for more and more children the school dinner is their only hot meal. The Minister for Children and Families said about school meals that it was up to schools to “manage their own” individual budgets. Is that the best the Government can serve up?

Our increases in school funding have been front-loaded to get money to schools rapidly, so this year core schools funding is increasing by £4 billion—a 7% cash boost per pupil. Our national formula also targets that funding towards areas of deprivation. It includes an FSM factor, which means that all pupils on free school meals will attract additional funding. The total amount allocated through deprivation factors in the national formula is increasing by £225 million, or 6.7%, in the next year, compared with last year.

The TS6 postcode area in my constituency is one of the most disadvantaged in Teesside, and there are not enough secondary school places for TS6 children this year, next year or the year after that, with kids having to travel miles to the nearest school with capacity. While understanding the inflationary pressures on schools, will the Minister work with me to ensure that there are enough school places for young people in the TS6 area in the years ahead?

The Department provides funding to local authorities in order to provide additional places where they are needed, and I would be happy to meet my hon. Friend to discuss that further.

Inflation is hitting all schools and colleges hard across my constituency, but unlike academies, councils, schools and other education providers, colleges cannot claim back VAT on supplies and services. Will the Minister speak with officials in other Departments to consider that issue, and to ensure that colleges such as Derwentside College in my constituency are able to do the best they can with the price pressures they are facing at the moment?

I am sure my hon. Friend the Minister for Skills will be happy to take up that issue on behalf of my hon. Friend. As Minister for Schools Standards, of course I want to ensure that our whole educational estate is able to invest effectively for the future.

Skyrocketing energy bills are squeezing school budgets. The latest data suggests that prices have almost doubled in the first quarter of the year alone. With cost pressures putting children’s learning at risk, will the Minister publish the results of his Department’s survey on the experience of schools? When does he plan to bring forward the additional support that schools need to keep the lights on?

The Department’s analysis of the cost increases that schools face is published annually in the school costs note, and it includes the impact of inflation. That was last published in March, and we will continue to publish it annually.

More broadly, it is important to recognise the additional money—the £4 billion that I have talked about numerous times—going in this year on the back of published figures that show that, at the end of the last academic year, 97% of academy trusts were in cumulative surplus or breaking even, and 92% of local authority maintained schools were in that situation. That was, in both cases, an improvement on the year before.