SOCIO-ECONOMIC DIFFERENCES IN TOTAL EDUCATION SPENDING IN ENGLAND: MIDDLE-CLASS WELFARE NO MORE
This research by the Institute for Fiscal Studies (IFS) has found that children from poor backgrounds in England now have more spent on their education than those from better-off families, in what experts called a ‘remarkable shift’ that has closed the long-term gap in government spending.
The research found that, since the start of the millennium, government policies and changing attitudes have transformed how much children from different social classes receive in state spending on their formal education, from primary school through to university.
According to the IFS, the turnaround is mainly due to the rise in the school-leaving age from 16 to 18, as well as the additional school funding, which began under Labour, targeted at disadvantaged areas and children. The rising proportion of children from poorer families going to college and university for the first time is also a factor, it said.
The IFS looked in detail at how the gap in funding shrank after 2003, when those from the richest families received nearly £6,000 more in state spending on education than those in the poorest 20%.
But by the time the cohort of pupils sat GCSE exams in 2010, the gap had disappeared so that students from both groups were receiving £73,000 in total funding across all stages of education.
Substantial boosts in school spending, notably under Labour until 2010, shrank the gap, despite richer pupils being substantially more likely to go on to higher education.
Key Findings:
- Socio-economic differences in total education funding had evaporated by 2010. Among pupils taking their GCSEs in Summer 2010, those in the richest and poorest socio-economic quintiles received about £73,000 in total funding across all stages of education. This represents a major reversal. Among pupils taking their GCSEs in Summer 2003, those in the richest quintile received about £5,900 more than those in the poorest quintile.
- School funding has become much more targeted towards poorer pupils. In 2003, there was already a £3,500 funding advantage in total school funding in favour of pupils from poorer families (looking over 12 years of schooling). As a result of various reforms to the school funding system, this grew to £9,500 by 2010, with pupils in the poorest quintile experiencing about £57,700 of school funding in total.
- Participation in 16–18 education is now near universal. In 2003, pupils from richer families were about 11 percentage points more likely to stay in post-16 education than those from poorer families. By 2010, participation was over 95% among all groups.
- This change in participation has more than halved the socio-economic gap in post-16 funding. In 2003, pupils from richer families ended up receiving about £2,800 more in total post-16 spending than those from poorer families. For pupils taking their GCSEs in Summer 2010, this gap had shrunk to £1,200.
- Children from poorer families are much more likely to attend colleges rather than school sixth forms. Among those taking their GCSEs in Summer 2010, about 58% of pupils from poorer families attended a further education or sixth-form college as opposed to 21% who attended a school sixth form. Among pupils from the least deprived quintile, about 41% attended a college and 47%attended a school sixth form. These substantial differences will have acted to increase socio-economic gaps in spending, given that school sixth forms received higher levels of funding per student until quite recently.
- Socio-economic gaps in higher education participation narrowed over the 2000s. Among pupils taking their GCSEs in 2003, children from richer families were about 33 percentage points more likely to go on to higher education. This meant that children from the richest quintile received more than three times the level of higher education spending experienced by those from the poorest quintile. The participation gap narrowed slightly to about 28 percentage points for pupils taking their GCSEs in Summer 2010. This reduced the funding gap, but children from richer families still experienced more than double the amount of HE.
- Pupils from richer families benefit more from long-run public subsidies to higher education. This is because they are more than twice as likely to go to higher education. Although pupils from richer backgrounds are likely to earn more themselves as graduates, and thus make larger student loan repayments, such differences would need to be implausibly large to cancel out the effects of differences in participation.
- Pupils from richer families would benefit more from the abolition of tuition fees, which again results from the fact that they are more likely to go to higher education. Pupils in the richest quintile would benefit by more than twice as much from such an abolition as those in the poorest quintile.
- Reforms since 2010 are likely to have increased total funding in favour of pupils from poorer backgrounds. The pupil premium was introduced from 2011 onwards. Reforms to post-16 funding have tended to favour colleges, which poorer pupils are more likely to attend, rather than school sixth forms. Evidence also suggests that socio-economic gaps in higher education participation have fallen slightly over time, though these remain substantial.