Nick Clegg's Education Speech (part 2)

5 June 2008

This is part two of Nick Clegg's education speech. Click here to read part one.


Fairer Funding: The Pupil Premium

But this extra money for schools, to stave off the present cuts, needs to go together with a radical reform of the way which we allocate money to schools. There needs to be a new way of matching funding to educational need.

The present system already acknowledges that different schools and pupils need different amounts of funding. It is more expensive to teach large numbers of children with special needs or from disadvantaged backgrounds. But we also know that the existing funding system for schools is opaque, and often illogical. There is often no clear link between need and funding.

Recently, with the help of the Association of School and College Lecturers, the Liberal Democrats looked at school funding in a sample of schools in areas with similar levels of deprivation. And we found that schools with similar levels of deprivation had very different levels of funding. There are cases where schools get £500 per pupil less than other schools with the same needs.

That is a half a millions pound deficit in a typical 1,000 pupil secondary school. This is absurd and unfair.

That is why I have advocated a new ‘Pupil Premium’, which would ensure that in the future more money is automatically allocated to each pupil from a disadvantaged background.

This extra money would follow the pupil to whichever school he or she attends. This works in two ways to make our school system fairer. It would be a powerful incentive for schools in more advantaged areas to take on more challenging pupils.

And it would also be a huge financial boost to schools with large numbers of such pupils. The extra money would help every school in England.

But it would disproportionately help schools in the most challenging parts of the country. I want to allocate £2.5bn to making this policy work. That would allow us to raise education funding immediately for the poorest 15% of pupils - the ones on free school meals - to the average levels in private schools.

The schools themselves would be free to spend this money as they think best, but we would make sure that it is no longer the case that national targets lead schools only to focus on the “borderline” pupils, while leaving those with the greatest problems to fall further behind.

It must no longer be good enough to focus just on converting Level 1s to Level 2s, or D grades to C grades. Every child really must matter, even the ones who struggle the most, and we will expect schools to ensure that no child is left to fail.

The additional money would help to fund one to one tuition, a longer school day, catch-up classes at weekends or in holidays, smaller class sizes, higher quality teaching staff - or whatever else is considered appropriate by the school.

Today I also want to announce that I am asking our Schools’ Working Group to look at whether it will be possible to expand the Pupil Premium concept.

There will be many pupils other than those on Free School Meals who struggle at school - not least, the children of parents who are on low incomes but who are in work.

I do not want these young people to be left out. The evidence is clear that many of these children face disadvantages which are similar to those of families who are living on benefits.

So, I am asking our Schools Working Group to look at whether, in the longer term, it would be possible to increase the Pupil Premium to around £4-5 billion to cover those children in low income families in work.

Clearly the immediate priority is to deliver on our pledge to raise funding for the poorest 15% of pupils immediately. But I want us to start exploring now how a more ambitious funding approach to all pupils from disadvantaged backgrounds would work.

A lot of the additional money would need to come from savings from within the existing budgets of the Department for Children, Schools, and Families. At present, while criticising local authorities for retaining some schools funding, the department actually retains some 18% of its budget for central initiatives.

I want to see much more of that money devolved directly to individual schools, as part of the Pupil Premium, rather than sitting in a bank account in Whitehall.

Early Years Funding and Class Sizes

However, creating a pupil premium will not solve all the problems in our school system. We also need to consider how baseline funding should vary across the Schools system for different age groups.

In the past, and to some extent today, there has been a tendency to spend more per head on education as the child gets older.

So, in the past, there was very little funding for the early years - but for those lucky few who went on to university, there was a very high level of per student funding.

This pattern of funding is clearly socially regressive - favouring those who stay in education for longest, who are statistically likely to be the most affluent. But this pattern of funding also appears to be less effective in promoting opportunity.

For example, as children become older, the evidence is that class size has less impact on pupil outcomes.

But in the early years, class size does matter. We need to have the ability to identify impediments to learning as early as possible in our education system. And we need the early interventions to help children to read, write and add up - the necessary foundations for all other learning.

So the Schools Working Group will assess whether - and how - we could tilt the playing field to transfer resources to the earliest years.

Both in terms of baseline funding and by weighting the pupil premium towards the years when it can make the biggest difference.

The money could help us move to very low class sizes, with higher funding levels, in the early years of education.

This has already happened in Wales, where adult-teacher ratios are being cut to 1:8 from ages 3 to 5. There are question marks about funding from the Welsh Assembly government - and delivery, too.

But we should welcome this move in principle - and we should consider making the same changes in England to cut class sizes for children of infant school age and below.

Other Funding Issues: Specialist Schools and Sixth Forms

There are two further issues of funding unfairness in our education system which must be resolved.

Firstly, there are still 343 secondary schools in England which have failed to achieve “Specialist” status, and which are therefore not entitled to the central government grants which come with Specialist Status.

In my view, it is wrong to bribe schools into making these types of changes, and every maintained school deserves consistent treatment in the way similar pupils are funded. But in this case, the implications of this unlevel playing field are even worse, because these schools come disproportionately from those with high levels of deprivation.

In areas with average numbers of children on free school meals, more than three quarters of the schools have specialist status. But in areas with between a third and a half of children on free school meals - as few as half of schools are specialist.

Many of these schools have results which are not good enough to allow successful application for Specialist Status. But holding back the extra per pupil funding is daft, because with this money, schools could offer extra support to pupils and ensure that their results do improve.

We believe they probably need more funding. But, they definitely shouldn’t be getting less funding than other schools - which is what they’re stuck with at the moment.

So I want us to ensure that all secondary schools in England are automatically funded at the higher level which is granted to Specialist Schools.

The costs would be minimal - £33m out of a budget of £70bn - but the effects for the poorest children would be profound.

There is one final obvious injustice. For too long, and without any justification, there has been a gap between the funding of “sixth form” students between those in school sixth forms and those in colleges. The same pupil will receive different amounts of money if he or she moves across the school/college divide. This is daft, and will be increasingly damaging as curriculum changes lead to greater sharing of pupils between these settings.

And the short-changing of colleges almost certainly also short changes some of our young people from the more challenging backgrounds.

The gap used to be 14% per pupil. It is still - after many promises of action - a massive 8%. This is simply indefensible. I want this gap closed - within one Parliament at most.
Meeting these spending aspirations will require tough choices for departmental resources. But as we’ve made clear with our approach to the Child Trust Fund and Tax Credits, we are not afraid to make those difficult decisions.

So we will be reallocating money within the department to end all these forms of unfair school funding once and for all.

Conclusion

Britain has a social mobility problem. The solutions are not instant or easy. But our education system surely offers us the surest route for breaking this cycle of disadvantage. Good schools and good education need a lot more than just money.

But money - well spent - can be crucial to delivering the opportunities and overcoming the very high hurdles faced by some young children.
The private sector of education knows this, which is why private school fees are so high and are rising rapidly.

Our maintained schools also need a new funding settlement. Protection against planned school cuts. Fairer funding. More money to tackle disadvantage.
Combined together, these proposals will be the bedrock of our ambition to end the problems of social stagnation in Britain today.

Applicability: this item refers to England and Wales. Due to devolution, detailed policy may be different in other areas of the UK.