Coronavirus will have extreme effect on school resources and spending, warns major report

The coronavirus pandemic will have "profound implications for school resources and spending”, a major report into school funding in Wales published on Thursday, October 15 reveals.

Compiled before Covid-19 hit, the review, commissioned by the Welsh Government in response to widespread concern about the ongoing school funding crisis, warns coronavirus is an added pressure at a time when it had already calculated school costs would soar by 8% in the next three years.

Before coronavirus school funding was the number one concern for many schools with headteachers warning budgets were at “breaking point”. 

Now schools have had to create online learning, adapt buildings for social distancing and pay for more cleaning, among other measures, to reduce risk of Covid infection. 

Last October unions estimated as many as eight in 10 schools in Wales were in deficit. Some headteachers said they were cleaning toilets to save money on cleaners and that children’s education was suffering as a result of funding cuts.

Today’s report says per pupil spend has fallen 6% in Wales in the last decade from  from to £6,388 in 2009-10 to £6,000. That is in-line with a corresponding 6% fall in the block grant to Wales from the UK government.

But the report warns of inconsistency and lack of transparency in how money reaches schools and is spent on the 450,000 pupils in Wales. There is also a lack of data to pinpoint whether it is being well spent.

Author, education economist Luke Sibieta, highlights staff pay as a major ongoing and future cost for schools. But he said high quality teaching and extra funding for deprived schools have the biggest impact on pupils’ achievement.

His wide-ranging 125-page review, commissioned by Welsh Government in response to an inquiry into school funding last year by the Senedd Children Young People and Education Committee, also notes wide variations across Wales.

While Ceredigion, Caerphilly, Blaenau Gwent and Conwy spend around £200 to £300 more than the average per pupil on education, Newport, Vale of Glamorgan and Flintshire spend lower than average for Wales.

But it is not clear, even accounting for regional and school differences, why this is, said Mr Sibieta, who is also a Research Fellow at the Institute for Fiscal Studies.

Instead of saying how much should be spent per pupil, his report calls on the Welsh Government to publish annual assessments of how much it will take to run schools and added pressures are each year.

It says wide variations make it unhelpful to suggest or use a universal per pupil spend but a yearly look ahead at school costs would help planning and focus minds of all those involved from councils to ministers, headteachers to the four school improvement consortia.

“Whilst not a guarantee of future funding growth, this would improve accountability by creating a high-profile comparison to judge funding decisions made by the UK government, Welsh Government and local authorities,” the document says.

“It would assist schools and local authorities in making long-term resource plans and provide a focus for debate on how policy decisions are likely to affect school costs.”

Future pressure on schools

Today's report says future pressures include pay awards, reforms to additional learning needs, responding to the coronavirus and other calls on council and government spending such as the rising older population. And that is all before a major squeeze on public spending thanks to coronavirus.

“An ageing population will also rapidly increase the demand for adult social care over time. Without significant additional overall funding, there is a risk that school spending could lose out incrementally to the demands of adult social care,” it warns.”

Covid will also have an impact: “... the pandemic will have profound implications for school resources and spending. This includes short-run costs as schools reopen and seek to minimise contagion risk, as well long-run consequences for educational inequalities.

“At the same time, the pandemic will also lead to massive strains on the public finances. Such challenges make it even more important to undertake a considered review of the school funding system to ensure it is well-placed to assist policymakers."

The whole school funding system should must be  simplified and made more transparent, the report adds warning: "Inconsistent and incomplete data reduces the transparency in the school funding system and can feed myths.

“This includes inconsistent, and often confusing, data on how local authorities spend their money. Spending on service-level agreements is not detailed within current data releases.

“Such problems make it hard for schools to understand local authority spending choices and for all stakeholders to draw lessons from comparisons across local authorities."

Launching the report Mr Siberta pointed out that spending by the school improvement consortia - which has been criticised by some for taking cash away from the frontline - only accounts  for only about £60 per learner, or 1% of total school spending in Wales, but it is not always clear why or how that money is spent.

“... the system of grants and reporting by regional consortia is highly complex and it is welcome that the regional consortia and Welsh Government are seeking to reduce this complexity."

Clarity is needed across all areas of school funding: "Effective scrutiny is only possible when all stakeholders have access to clear information and data on how school funding is allocated.

"More consistent and detailed spending data would enable informed discussions between local authorities and schools about how best to use funding.”

Funding from UK Government to the Welsh Government comes in the form of a block grant and education funding is not ring-fenced within that. School spending levels are set by individual local authorities with the vast majority of funding for schools coming from the local government settlement. Ring fencing money for education could mean some councils get more or some less, and is not recommended in the report.

But it makes 12 recommendations, including an annual assessment of how much it will cost to run schools and greater transparency about funding and differences in how it is spent.

Responding to the findings Education Minister Kirsty Williams said: "When this work was commissioned in October last year nobody could have known about the unprecedented strain the coronavirus pandemic would have on public sector budgets.

“I am fully aware of the real pressures that local authorities and schools are now facing as a consequence of the pandemic - such challenges make it even more important that a considered review of the school funding system has been undertaken to ensure it is well-placed to assist policymakers as we move forward. 

“The Welsh Government is doing everything it can to ensure Wales’s public services have all the resources they need to respond to, and mitigate the impact of, the crisis.

“Now, more than ever, we need to understand the funding decisions made across Wales to secure equity and excellence for our learners.

“The publication of this report is therefore very timely as it provides evidence to enable policy makers to make informed decisions when considering funding for schools across Wales, continuing our overall aim of improving school standards and reducing inequalities."