This Education Policy report uses EPI’s new school funding model, which replicates the Department for Education’s own national funding formula (NFF) and allows the authors to analyse the impact of potential funding policy decisions on individual schools and areas of the country.
The analysis reveals the significant impact that projected falls in pupil numbers could have on school funding across England, showing the challenges that these demographic changes will present to the financial health of schools.
School funding in England is heavily tied to the number of pupils in schools. The system used by the DfE to calculate a school’s funding allocation each year - the national funding formula (NFF) - contains a series of per-pupil ‘factors’ used to calculate the sum a school receives based on the number of eligible pupils for each factor.
however, reductions in class sizes do not bring about proportional decreases in staffing costs, school supplies, energy bills, and the other day-to-day costs of running a school. Faced with this challenge, some of the most severely affected schools will struggle to stay viable. As these schools feel the squeeze, they will be forced to consider alternatives: mergers with other schools, difficult cost-cutting measures, and ultimately school closures.
Some schools, particularly those in London and other urban areas, are likely to see both decreases in pupils and an increase in the rate of deprivation. Significant falls in funding in these areas risks further widening of the disadvantage gap as school budgets struggle to meet the additional needs of disadvantaged pupils.