Agenda item

To consider the attached report of the assistant Director, Finance and Director, Education (Tameside and Stockport).

Consideration was given to a report of the Assistant Director of Finance and the Director of Education (Tameside and Stockport), which provided members with an update on the latest funding announcements.

Members were made aware that The DSG announcements at this stage only covered the Schools Block, High Needs Block and the Central Service Support Block.  Early Years Block information had not be shared at this point.  However, it was explained that updates on this and confirmation of all other allocations were expected in December 2021.  It was noted that the data stated in this report was based on the 2021-22 data set (October 2020 census data) and would change in order to take account of October 2021 census returns.

With regard to Schools Block, it was explained that there had been an increase of £40.146m, which represented an increase of 4% at a national level.  This had resulted in a £5.573m increase in 2022-23 provisional allocation, excluding growth funding and Members were presented with a detailed breakdown of the funding elements.

Key areas of change were highlighted, including the Sparsity Factor.  Members were informed that NFF rates had been significantly increased by DfE on the Sparsity Factor for a 2nd year, which had resulted in an increase from £45k to £55k per primary school, and from £75k to £80k in secondary schools.  However, as this was payable to schools, which were both small and remote, although the distance measurements had changed so that this would reach a wider number of schools,  there would still be no Tameside schools, which would benefit from this as they did not meet the criteria.

Members were informed that there had been changes to the rates at which IDACI bandings were paid and that, in most cases, these had increased by at least 3%.

With regard to Prior Attainment and Mobility Factors, 2019 attainment data would continue to be used as a proxy for allocated this funding.  Similarly, it was stated that Mobility Factor was using a proxy for May 2020 and that the census did not take place.  Instead, it was explained that the child’s start date in school, would be used.

It was highlighted that the measurement  point for Free School Meals Ever6 had changed.  This had been brought forward from the January census to the October census to reduce lag and had been brought in line with the measurement point for other factors.  It was stated that the related increase in this factor was 2%.

It was noted that, following consultation, Business Rates funding would no longer be allocated to the Local Authority or Academy Trusts for them to pay the Council but that these costs would be paid directly by DfE to each Local Authority on behalf of all schools and academies in the area.

It was explained that Minimum Funding Guarantee (MFG) would continue to be set by Local Authorities using local formulae between +0.5% and +2% per pupil and that there would be continuation of the compulsory Minimum Per Pupil Funding Levels (MPPL).  This would mean that al primary schools would receive at least £4,265 per pupil and all secondary schools £5,525 per pupil.

Members were made aware that the DfE were taking steps towards a ‘hard’ National Funding Formula (NFF) and a consultation for Local Authorities, schools, academy trusts and any other interested parties had been launched in July.  Members were provided with the link to access the consultation and advised that the closing date was 30 September 2021.

In relation to the High Needs Budget, Members were informed that there had been a 9.6% national increase (£780m) and that Local Authorities had seen an increase of between 8% minimum and 11% (capped and before recoupment, Alternative Provision and Hospital Funding Factors were included).  It was noted that Tameside had received the maximum increase of 11% (capped).  However, without this cap, Members were advised that this would have included an additional £2.988m. 

In addition, it was noted that Tameside’s Historic Factor had changed from £8.6m to £8.8m.  However, due to the cap, the full benefit of this increase would not be received.  It was highlighted that these current announcements were provisional and would be subject to further updates, which were outlined for Members of the Forum.

The provisional allocation for 2022-23 was provided compared to the current 2021-22 allocation.  This highlighted an overall increase of £3.072m (before recoupment and any further adjustments).  Members were also asked to note that an estimate for growth in pupil numbers was built in at £0.101m, which would be finalised and confirmed in December 2021 but was likely to be offset by an estimated increase in recoupment.

Members were advised that, although Tameside was seeing an increase in funding of £3.062m (after recoupment), this was offset by an estimated increase in spend of £5.375m.  This was reflective of the continuing expected increases and further growth of Education Health Care Plans (EHCPs), which was likely to increase steadily from 3.58% to over 6% in the next 5 years.

Members were reminded of the significant impact of the capped Funding Formula allocation on the High Needs Deficit position and it was explained that Tameside would continue to receive this capped funding for 2022-23, with a further cap of £2.988m forecast.

It was explained that Local Authorities would continue to be able to transfer up to 0.50% of Schools Block allocation to another block within the DSG, with the approval of Schools’ Forum.  Members were also reminded that a disapplication process to the DfE would continue to be in place for any amounts over 0.50% or for any amount without the approval of Schools’ Forum.

Based on current projections, Members were made aware that, even continuing with the 0.50%  transfer (as in 2021-22) of £0.939m, this would still leave a potential in-year deficit on the High Needs Block of £4.644m in 2022-23 and a 1.00% transfer would leave an in-year deficit of £3.705m and potential cumulative deficit over the 2 years of £6.098m.  With this in mind, Members were asked to support the 0.50% transfer to the high needs Block to support spending for additional needs and were further asked to consider whether a request to DfE should be made in requesting a top slice to 1% with permission from the Secretary of State.

With regard to the Central Services Schools Block (CSSB), it was stated that funding had increased by 5.6% (£62k).  However, without the cap on this funding, Tameside would receive an additional £145k.

Discussion ensued in relation to the value that comes from transferring this funding.  It was highlighted by the Director, Education (Tameside and Stockport), that this transfer would allow schools to collectively ensure that investment in the most vulnerable children, who attend school, would be maximised.  It was stated that this would provide investment for this year and help to manage the deficit for future years in order that the deficit position reduces over time.  However, the financial impact of Covid in schools was highlighted by Members.

RESOLVED

(i)     That the contents of the report be noted.

(ii)    That it be agreed, in principle, for 0.50% to be transferred from the Schools Block to the High Neds Block in 2022-23 (at a minimum)

(iii)  That it be rejected to support a disapplication request, in principle,  to the Secretary of State in order to transfer 1.00% from the Schools Block to the High Needs Block (if required)