Agenda item

School Forum members to consider and make a decision on the consultation proposals as set out.

The Forum received a report which sought recommendations from the Forum in relation to the school funding formula for 2022/23 following consultation with schools.

 

Furthermore, the report sought approval for various matters in relation to de-delegation proposals for 2022/23, Education Funding proposals for 2022/23 and Central Schools Services Block for 2022/23.

 

The decisions of the Forum defined the budget setting processes for all schools and academies within the borough for the next financial year. Given national government announcements on future funding for schools, this process would assist schools in preparing strategic plans, ensuring schools were able to create viable budget, staffing and curriculum plans. All decisions would affect the amount available to be delegated directly with schools and focus on what funding was centrally retained to protect services and schools with falling rolls.

 

The Schools Budget Consultation had been issued to schools on 10th November 2021 having been approved at the Schools Forum meeting on 8th November 2021, with a deadline of noon on 1st December 2021 to respond.

 

A summary of responses to this consultation was detailed within Appendices 1 – 5, which were appended to the report.

 

Consultation with the below stakeholders had held as follows: -

• Joint Executive Group – 11th November 2021

• Primary/Secondary Partnership – 15th November 2021

• Joint Union Panel – 16th November 2021

• Association Sandwell Governing Bodies – 24th November 2021

 

A total of 53 responses had been received (compared with 70 last year), with 43 out of 94 (46%) primary schools / academies, and 10 out of 20 (50%) secondary schools / academies responding.

 

The authority had also received two responses from individual unions.

 

Consultation Responses

 

The consultation on the formula funding for schools for 2022/23 includes proposals on the following: -

 

The funding formula to use for allocating schools budgets:

• Option 1 – Stepped change in the ratio - LA Formula with a ratio of 1:1.29 in year 3.

• Option 2 – Secondary Schools receive 1% more above the overall increase in funding.

• Option 3 – National Funding Formula Factor Values

• Pupil Number Growth Contingency Fund.

• Minimum funding guarantee and capping of gains.

• Education Functions.

• De-delegation proposals.

• Central Schools Services Block.

 

Funding Options – Consultation responses

 

The authority had modelled 3 options for calculating schools revenue budget for 2022/23. There had been some general adjustments, which apply to all options, which were as follows: -

 

• Q3 Langley had opened in September 2016 with a PAN of 240 for each year group. The PAN had increased to 300 from September 2021 (however, for modelling purposes, the pupil numbers were the same as 2021/22 to allow for comparison).

• The Shireland Technology Primary had opened in September 2019 with a PAN of 60 for Reception.

• The West Bromwich Collegiate Academy had opened in September 2019 with a PAN of 150 for each year group.

• The amalgamation of Warley Infants and Bleakhouse Junior Schools into Bleakhouse Primary School on 1st September 2020. The guidance stated that where schools had amalgamated during the financial year, they retained the equivalent of 85% of the predecessor schools’ lump sums for the following financial year (2021/22).

 

For example, assuming a lump sum of £100,000, the additional payment would be £70,000 ((£100,000 x 2) x 85% - £100,000).

 

Local authorities could apply to provide a second year of protection. Applications must specify the level of protection sought, although the expectation from the DfE was that the additional protection would not exceed 70% of the combined lump sums. They had stated they will consider applications on a case-by-case basis.

 

At its meeting on 8th November 2021, Forum members had agreed that an application could be submitted for Bleakhouse Primary School requesting a second year of the lump sum protection equivalent to 70% of the predecessor schools’ lump sum for the financial year 2022/23.

 

The ESFA had since approved the application request.

 

The funding formula options were as follows: -

 

Option 1: Stepped increase to the 2022/23 Local authority model - Increase of the Primary: Secondary Ratio to 1:1.29 (3rd Year)

 

This model used the same factors as previous years, except for the two factors mentioned below. In Sandwell’s local school funding formulae, the 2021/22 rate for Basic Entitlement / AWPU was significantly above the National Funding Formula (NFF) rate. The recommendation had therefore been to keep these rates the same for 2022/23 and instead introduce for the first time, factor value rates for Free School Meals (FSM) and Free School Meals Ever 6 (FSM6) in order to reflect the change of moving to a primary secondary ratio of 1:1.29:

 

Option 2: Secondary Schools receive 1% more above the overall increase in funding.

 

This model provided secondary schools 1% more of the additional funding than primary pupils (The 1% was calculated on the basis of funding to primary and secondary schools prior to applying MFG and MPPF). The model used the same factors as previous years, except for the FSM6 which had been introduced for the first time in order to reflect the change of secondary schools receiving 1% more above the overall increase in funding.

 

Option 3: National Funding Formula Factor Values

 

This model used the factor values used in the National Funding Formula, without applying the Area Cost Adjustment. In order to fund the Pupil Number Growth fund and the MFG to be set at 0.5% to keep in line with the modelling of the other options, the English as an additional language factor had been changed from those eligible pupils recorded on the census as having entered state education in England during the last three years, whose first language was not English, to those pupils entering during the last two years to remain within the funding envelope announced.

 

Most respondents voted for Option 1. The responses for each option was shown below: -

• Option 1 – 42 Agreed, 11 against

• Option 2 - 1 Agreed, 52 against

• Option 3 – 0 Agreed, 53 against

 

The following responses reflect some of the comments received:

• “I have not indicated an option as my preference is to request a standstill as I do not believe any more money should be moved from primary sector to secondary sector as no evidence / research has been provided to support. Further consultation is needed through schools forum.”

• “Without discussing and agreeing an educational rationale, it should not be possible to make any of the changes to school funding mechanisms as proposed”

 

The comments above were a small reflection of the comments received in relation to the options for the authority funding formula. Appendix 5 provided further detail on the comments made about the funding formula as well as detailing comments on each question in the consultation and general comments overall.

 

Pupil Number Growth Fund

 

Local authorities may top-slice the DSG to create a growth fund. The growth fund was ring-fenced so that it is only used for the purposes of supporting growth in pre-16 pupil numbers to meet basic need, to support additional classes needed to meet the infant class size regulation and to meet the costs of necessary new schools. These would include the lead-in costs, post start-up costs and any diseconomy of scale costs.

 

Local authorities were responsible for funding these growth needs for all schools in their area, for new and existing maintained schools and academies.

 

• Local authorities must fund all schools on the same criteria.

• Where growth occurs in academies that were funded by ESFA on estimates, the ESFA would use the pupil number adjustment process to ensure the academy is only funded for the growth once.

 

The Authority had estimated the costs for authority led expansions of schools to cater for the increase in birth rates, pre-opening and diseconomy of scale costs for West Bromwich Collegiate Academy and it had also estimated mid-year admissions costs.

 

For the last 4 – 5 years, the pupil number growth fund had been set at £2.269m. However, since 2019/20 the level of recoupment that the LA had been able to retain had increased to an average of £0.544m per year compared to levels of £0.178m per year prior to 2019/20. This had, therefore, increased the total Pupil number growth funding in the last few years.

 

In 2021/22 the Pupil number growth fund had reduced from the levels set in previous years of £2.269m to £1.091m as a result of accrued balances built up over the last few years.

 

The Government had stated in their consultation document “Fair School Funding for all: completing our reforms to the National Funding Formula”, that they were planning to change growth funding and the basis on which they fund new and growing schools.

 

DFE Growth fund – Current formulaic method

 

Growth funding was within local authorities’ schools block NFF allocations. Since 2019/20, growth funding had been allocated to local authorities using a formulaic method based on lagged growth data. The change in the method of funding to local authorities had not changed the way in which authorities could allocate funding locally.

 

For each local authority, the growth factor would allocate: -

• £1,485 for each primary “growth” pupil.

• £2,220 for each secondary “growth” pupil.

• £70,800 for each brand-new school that opened in the previous year (that was, any school not appearing on the October 2020 census but appearing on the October 2021 census).

 

The authority currently funds schools as follows: -

• LA agreed PAN Increase / Bulge Class at 100% of Basic Entitlement / AWPU; which for 2021/22 was £3,512 for primary pupils and £4,977 for secondary pupils.

• Mid-Year Admissions at 50% of Basic entitlement / AWPU for 2021/22.

• New / Growing schools – ESFA rates for leadership and resources.

 

Given the disparity between the Growth funding rates received by the authority and the Pupil number growth rates used to pay schools, and because of the government’s plans to change the basis of funding; the authority was proposing two options for setting the allocation: -

• Option 1: Continue with the current criteria as set out in section 4.25 (of the report). An estimation of the Pupil Number Growth amount required was £1.850m.

• Option 2: To fund schools for LA agreed PAN / Bulge increase and New / growing schools only. The funding for mid-year admissions would cease. An estimation of the Pupil Number Growth amount required was £1.300m.

• Option 2 had been put forward for schools to consider working towards aligning the authority’s Pupil growth fund with the government’s direction of travel; particularly in relation to the growth values.

 

The majority of respondents had agreed option 2 with a Pupil Number growth fund set at £1,300,000: -

• Option 1 – 21 Agreed, 32 against

• Option 2 - 35 Agreed, 18 against

 

De-delegation Proposals

 

There were 5 de-delegation proposals, as set out in the table below: -

 

 

Schools Forum maintained school members were asked to make a decision on these budgets, taking into consideration the responses which had been received from schools (as set out in appendix 2 to the report).

 

Education Functions Proposals for maintained schools

 

Local Authorities could fund services previously funded from the general funding rate of the ESG (for maintained schools only) from maintained school budget shares, with the agreement of maintained school members of the Schools Forum.

 

The relevant maintained schools members of the Schools Forum (primary and secondary), should agree the amount the local authority would retain.

 

Sandwell, in line with guidance, intended to set a single rate per 5 to 16-year-old pupil for all mainstream maintained schools, both primary and secondary. The rate of £14.97 per pupil was based on October 2020 census data, this would be updated to be based on October 2021 census data.

 

If the local authority and Schools Forum were unable to reach a consensus on the amount to be retained by the local authority, the matter could be referred to the Secretary of State.

 

There were 3 education function proposals, as detailed in table below: -

 

Attendance and Safeguarding Team

 

At the last meeting, Schools’ Forum had expressed an interest in better understanding the services provided by the Attendance and Safeguarding team and the appropriateness of the funding approved by the Forum. The request for additional information was made at a stage in the current consultation process that would not allow time for wider consideration and enable the Forum to make an informed decision about future funding.

 

It was, therefore, suggested that the Children’s Directorate undertake a review of the team, with the assistance of the Forum, seeking to assess the value added by the team compared to the funding made available from DSG. The review to be completed in the first half of 2022 and reported to Schools Forum no later than the meeting scheduled for 20 June 2022, with the objectives of the review agreed in advance with the Chair of the School Forum.

 

Minimum Funding Guarantee

 

Local authorities continued to have the ability to set a pre-16 minimum funding guarantee (MFG) in their local formulae, to protect schools from excessive year-on-year changes and to allow changes in pupil characteristics (for example reducing levels of deprivation in a school) to flow through.

 

The DfE had stated that there continues to have greater flexibility for the MFG in 2022/23; local authorities were able to set an MFG between plus 0.5% and plus 2.00% per pupil. Setting the MFG between these rates provided the authority with the flexibility to make local decisions about the distribution of funding and enabled the authority to manage any changes in pupil characteristics when characteristics data was updated in December.

 

The respondents had unanimously voted for an MFG of at least 0.5% and up to 2.00% if modelling proved this was achievable within the funding given (53 agreed,0 against).

 

The majority of respondents had agreed with the scaling and capping of the MFG if it proved necessary to ensure the MFG was within the funding envelope. (40 agreed, 13 against).

 

Central School Service Block

 

The Central Schools Service Block (CSSB) continued to provide funding for local authorities to carry out central functions on behalf of maintained schools, and academies, comprising two distinct elements: -

• ongoing responsibilities; such as admissions and schools forum costs.

• historic commitments; in this case pensions administration.

 

Funding for historic commitments was based on the actual cost of the commitment. The DfE had stated they expect these commitments to reduce and cease over time and there would be no protection for historic commitments in the CSSB.

 

For 2022/23, the DfE had reduced Historic commitment funding by 20%; this had resulted in a cut for Sandwell from £0.182m to £0.146m.

 

Schools Forum approval was required each year to confirm the amounts on each line for central school services, a detailed in the table below. In the event that Schools Forum did not agree with the authority’s CSSB proposal, as detailed below, the authority can ask the DfE to adjudicate.

 

 

The majority of respondents had agreed with each service element detailed in the table. Schools Forum members were requested to make a decision on these budgets taking into consideration the responses from schools (as set out in Appendix 4).

 

Schools Response

 

The anonymised comments from schools in relation to the consultation were included in Appendix 5.

 

Trade Union Response

 

The authority had consulted with the Joint Union Panel and received responses from the National Education Union (NEU) and the National Association of Head Teachers (NAHT).

 

The NEU had responded as follows: -

 

“Sandwell is NOT what you call an ‘average’ area. In 2018, according to a report on childcare, it was reported that more than 20,000 children were living in poverty in Sandwell, which is one in every four children. It is for you to decide if you think things have improved since then. According to The English Indices of Deprivation 2019, which is an official measure of deprivation, Sandwell is one of the most deprived areas in the country. On most measures, Sandwell is the most deprived local authority within the Black Country.

The DfE acknowledged the essential role of LAs during the pandemic to support education, however, such praise will be short lived. The consultation document mentions significant financial challenges ahead such as the increasing outsourcing of services, once provided by the council. This is a further step towards a fragmented, privatised system in which, sadly, competition and profit will come before pupils.”

 

The NEU stated in relation to question 1: -

“Whilst Sandwell NEU recognises the historic primary/secondary ratio as being favourable to primary schools, there is a reason for this. As stated above, Sandwell is not an ‘average’ LA, regarding poverty and deprivation. Sandwell NEU would have preferred a standstill option.”

 

The NAHT had agreed with the proposal to change the Pupil Number Growth criteria and they agreed with all the other proposals for the MFG and capping and scaling, de-delegations, Education functions and the Central Schools Services Block.

The NAHT did not respond to question 1 in the consultation, but had stated that “A number of members have been in touch to express disappointment that there was no standstill option presented this year given the significant increases in their ongoing expenditure.”

 

The NAHT had also agreed with the proposal to change the Pupil Number Growth criteria and they agreed with all the other proposals for the MFG and capping and scaling, de-delegations, Education functions and the Central Schools Services Block.

 

Proposed Schools Funding Formula 2022/23

 

The views of all stakeholders would be taken into consideration in relation to the consultation on the schools funding formula for 2022/23. The authority would consider the recommendation of School forum, but it would ultimately be the local authority’s decision.

 

Members discussed the report and, in particular, queried the following: -

The Vice-Chair sought clarification in relation to the ‘stand-still’ option. Various Head Teachers had spoken with him on this particular matter. He had been informed that this particular directive had arisen from a decision by Councillor Hackett back in February 2019. He understood, from reading the minutes of that meeting, that Primary and Secondary Head Teachers had been requested to discuss the educational journey of the children to help understand the impact of the move towards NFF. As this had taken place before his appointment to the Forum, he queried if any such discussions had taken place at the Forum and, if so, what was the outcome of those discussions.

 

R Kerr advised that the feedback she had received from the Director in post at that time was that Head Teachers were of the opinion that the direction of travel should be a move towards the NFF in stages over the forthcoming years. A number of the existing Forum Members who had served during this time period, clarified that they had been part of such discussions and that the outcome, as described by R Kerr, was an accurate reflection of what had been decided. All schools had been consulted and had voted. The 3-year option had been selected by the majority of schools, on the understanding that it would come back to the Forum each year to be voted on.

 

A Member of the Forum queried if Cabinet, when provided with the figures based upon whatever the Forum decided on this report, would be provided with a sample of the key comments from schools. She felt it was important that Cabinet was presented with a representative sample of the comments from schools so that they could consider the viewpoints / context within which the decision would be made. In addition, the original decision had been taken pre-pandemic and the situation was now quite different.

 

R Kerr advised that a sample of responses could be included in the report to Cabinet, as set out in Appendix 5 to this report.

 

The Vice-Chair, responding to the above issues and how the needs of children had significantly changed since the Pandemic, sought clarification in relation to if there was a viable option, or not, to overturn the original decision made back in February 2019. Furthermore, if this was the last of the 3-year plan, whether it would be an option next year to ‘stand-still’.

 

M Jarrett advised that it was difficult to answer this query at present, as it would be entirely dependent upon the next guidance document issued by the DfE in order to ascertain what options were / were not viable. As soon as the guidance had been issued, a report detailing the most viable options would be brought back to the Forum for consideration.

 

The Vice-Chair requested Officers who designed the consultation form to look at taking into account the comments made by schools and to adjust the form accordingly for future years. R Kerr agreed to look into this matter.

 

A number of Forum Members requested that a Sub-Working Group of the Forum be set up to review the ‘Union Facilities Time’ aspect of the de-delegated budget proposals in a similar way to that of the Working Group which had been set up to review the efficacy of Safeguarding and Attendance. This suggestion was agreed, and Officers would make the necessary arrangements accordingly.

 

Agreed that the below items be approved / rejected, as set out: -

Item Voted on	For	Against	Abstain
Funding Options: Option 1	12 Agreed	0	1
Pupil No. Growth Contingency Fund: Option 2	12 Agreed	0	0
Minimum Funding Guarantee & Capping Gains Part A: 0.5% - 2.00%	12 Agreed	0	0
Minimum Funding Guarantee & Capping Gains Part B: MFG within funding envelope	13 Agreed	0	1
Education Functions Budget Proposals 2022/23: Education Functions	12 Agreed	0	0
Education Functions Budget Proposals 2022/23: Children’s Clothing Allowance support	12 Agreed	0	0
Education Functions Budget Proposals 2022/23: Safeguarding & Attendance	14 Agreed	0	0
Item Voted on	For	Against	Abstain
De-delegated Budget: Health & Safety Licenses	Primary: 6 Secondary: 1 Agreed	Primary: 0 Secondary:0	Primary: 0 Secondary:0
De-delegated Budget: Evolve Annual License	Primary: 6 Secondary: 1 Agreed	Primary: 0 Secondary: 0	Primary: 0 Secondary: 0
De-delegated Budget: Union Facilities Time	Primary: 1 Secondary: 1 Agreed	Primary: 0 Secondary: 0	Primary: 5 Secondary: 0
De-delegated Budget: School Improvement Services	Primary: 6 Secondary: 1 Agreed	Primary: 0 Secondary: 0	Primary: 0 Secondary: 0
De-delegated Budget: School in Financial Difficulties	Primary: 6 Secondary: 1 Agreed	Primary: 0 Secondary: 0	Primary: 0 Secondary: 0
CSSB Proposals 2022/23: Statutory & Regulatory, Education Welfare and Asset Management	13 Agreed	0	0
CSSB Proposals 2022/23: Schools Forum	13 Agreed	0	0
CSSB Proposals 2022/23: Admissions Service	13 Agreed	0	0
CSSB Proposals 2022/23: Pensions Administration	13 Agreed	0	0
Attendance & Safeguarding Review	13 Agreed	0	0