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Breaking Point: A report of the school funding crisis in 2016/17

NAHT has released the results of a second survey of members on school funding. Over a thousand school leaders responded with information about their budgets for 2016/17.

School budgets are close to breaking point

Russell Hobby, general secretary of school leaders union NAHT, said: "School budgets are being pushed even closer to breaking point than before. The number of schools currently in deficit has more than doubled since our 2015 survey, with nearly three quarters of school leaders only able to balance their budgets by making cuts or dipping in to reserves.

"Schools are acutely feeling the impact of an estimated £3bn shortfall in the government's education budget by 2020 – the first real terms cuts to education spending since the 1990s. 98 per cent of schools are losing funding, at a time when costs are rising and pupil numbers are growing. 72 per cent of school leaders say their budgets will be unsustainable by 2019.

"The government must take urgent action and commit to funding schools sufficiently in the next Budget. It is time to stop viewing education spending as a cost and to start seeing it as an investment in England's future, and in our children's."


What did we find?

NAHT's Breaking Point survey for 2016/17 shows that:

  • The number of schools currently in deficit has more than doubled since our 2015 survey (up 10 percentage points from 8 per cent to 18 per cent)
  • Nearly three quarters (71 per cent) of school leaders are only able balance their budgets by making cuts or dipping in to reserves.
  • 72 per cent of school leaders say their budgets will be unsustainable by 2019.
  • Increases in payroll costs as a result of government policies were cited as schools' biggest financial pressures. These costs went up in 2015 and have resulted in an increase to school budgets of over 5.5 per cent every year, but there has been no resulting increase in funding from the government.
  • 47 per cent of survey respondents reported the decline of local authority services as a cost pressure on schools, in particular the abolition of the Education Services Grant (ESG) to local authorities which is being passed through to schools. 65 per cent of academy school leaders told us they are concerned about the impact of cuts to ESG.
  • The third most quoted source of financial pressure reported by school leaders was the cost of dealing with the additional needs of pupils, reported by 83 per cent of respondents. Members have expressed serious concerns about the extra pressure they are facing to support the growing number of children with mental health issues.
  • The most commonly reported cost saving was reducing investment in equipment, which 85 per cent of respondents said they were having to do.


The impact of austerity on health and social care 

James Bowen, director of middle leaders' union NAHT edge, said: 

"Almost four fifths of our survey respondents told us that they currently provide support for children with mental health issues directly, stepping in where cuts in health and social care funding have failed to meet the growing demand for support.

Staff in our schools are being asked to be doctors, police officers, social workers and family support assistants as well as teachers. They cannot do this without additional resources."

What do members think about school funding in 2016/2017?

Bernadette Hunter, head teacher at William Shrewsbury Primary in Burton-upon-Trent, said: "The removal of the Educational Services Grant, wage inflation, increases in pension and National Insurance contributions, the apprenticeship levy and cost of living increases, are all leading to a real terms cut for schools. Costs are rising at a time of stagnant budgets, and the new funding formula, that we hoped would help, will see our school lose £38,000 – a teacher's salary. This is devastating. The funding formula will fail if there is not enough money put into it and children's learning will suffer."

Liam Collins, head teacher, Uplands Community College, Wadhurst, East Sussex, said: "The protected per student funding is not protected. This year we received £4,664 per student, and this flat cash settlement is what we will receive for the foreseeable future. This is well below the national average, even under the new funding formula. With inflation and unfunded cost increases we only have £4,431 to spend on each pupil. To our overall budget this is a cut of £208,711, which in three years rises to our school being under funded by £350,000. In simple terms this is a cut of 10 teachers, fewer clubs, no pastoral support, a narrowed curriculum, no counselling for students struggling with mental health issues, crumbling buildings, no IT upgrades, no new text books and no school planners. Eventually this will impact on student outcomes. This is not about fair funding, but enough funding for all schools to operate."

The full report is available to members and can be accessed below.

NAHT release their latest report on the school funding crisis.

First published 20 January 2017