5th July 2017

Research Note: Where next on school funding and the National Funding Formula?

The Education Policy Institute (EPI) has today published new analysis on how the government can proceed with school funding and a new National Funding Formula. 

You can download the paper in full here

Key findings


  • The analysis finds that in order to address the inflation pressures faced by schools, the government would need to allocate an additional £1.3bn in the schools budget by 2021-22, over and above the £4bn commitment made in the Conservative manifesto.
  • Without this £1.3bn, there will be a real-terms per pupil reduction of 3 per cent by the end of the Parliament. This £1.3bn is on top of the Conservative manifesto commitment, which would have already required Chancellor Philip Hammond to find more for the schools budget. Since the government may no longer be able to rely upon redirecting savings from abolishing universal infant free school meals (UIFSM), the Chancellor already faces challenges to deliver the £4bn manifesto commitment. The Treasury may therefore need to find over £2bn of new money to deliver real terms protection.
  • The government has committed to introducing a new national funding formula with no losers in cash terms, at a potential cost of £350m per year. If the government does decide to put in the extra £1.3bn to protect real per pupil spending, then Justine Greening could use some of the extra money to help ensure that schools in lower funded areas see bigger budget rises. This might help persuade more of the government’s own MPs to support the new funding formula.
  • The government therefore needs to confirm whether it will maintain its commitment to implement the national funding formula in April 2018. Local authorities and schools need to know how much funding they are likely to have next year so that they can plan accordingly.


Related reports: 

General Election 2017: An analysis of manifesto plans for education

The implications of the National Funding Formula for schools