Multiple funding for school capital projects should be replaced with one source, and LAs should be able to set up community schools, says LGA

Janet Downs's picture

Prepare to be confused. If schools need maintenance or rebuilding, or if new places are required, there are several funding pots. These have different labels such as:

Basic Needs Allocation for new pupils places (the Government was accused of siphoning money from this pot to free schools);

Targeted Basic Needs Funding: additional funding for extra school places.

Priority School Building Programme: for schools urgently needing repair. 580 schools applied – less than half (261) were successful. 46 of these will not receive grants but will be financed by private finance funding.

Devolved Formula Capital

As well as dividing the funding between maintenance, new places and rebuilding disintegrating schools, the money is subdivided between local authority (LA) schools, Voluntary Aided (VA) schools, free schools, City Technology Colleges (CTCs), sixth-form colleges, academies and NIMSS*.

This multiple sourcing is confusing and fuels speculation that academies and free schools receive a larger share of funding. This may or may not be the case** but one school in Brighton, Hove Park School, tells parents that unless it becomes an academy it would not be “listened to” by funding agencies. And the initial rush towards academy conversion was encouraged by the perception that academies would receive more money – a March 2013 survey found.

The Local Government Association (LGA) has come up with a five-point plan to address the problems caused by multiple funding streams. The LGA recommends:

1 There should be single capital pot locally. This would allow LAs and schools to collaborate to ensure capital funding is used in the best possible way.

2 The three-year allocation should be extended to five years. This would allow LAs to plan ahead and commission extra school places.

3 The decision-making powers which LAs once had should be restored. This would allow LAs to direct academies to expand to provide extra places.

4 LAs should have the option of setting up LA maintained community schools. LAs should be able to decide, after consultation with parents and communities, which sponsor would establish an academy.

5LAs should have a greater role in approving free school proposals so they’re set up where needed and don’t contribute to school place surplus. This would help, not hinder, LAs in their statutory duty to manage school place supply.

I would add an extra recommendation: LAs should be able to take academies back under their stewardship if a sponsor or board of trustees wants to close academies, an academy trust decides to divest itself of responsibility for its academies or if the Department for Education removes academies from a particular chain. 


NOTES  (if you’re not confused about capital funding already, you will be after reading these):

*I’m not sure what NIMSS are – they might be Nurseries in Maintained Sector Schools or Non-Maintained Special Schools – who knows?

**It’s difficult to discover whether academies and free schools receive more funding. My initial suspicion was they were. However, suspicions aren’t enough – they have to be proved with evidence. Devolved Formula Capital, for example, is weighted according to whether it’s for secondary or primary schools. The only way to make sure whether funding is fair is to look at the number of pupils on roll in each school (thanks Andy).

But the spreadsheets aren’t set out identically: the spreadsheet for LA/VA schools shows numbers on roll but the one for academies doesn’t. And the former allows me to select different types of school and stages while the latter doesn’t.

It’s enough to make you go mad (thanks Graham Clarke).


Formatting corrected: 14 Nov 2019

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Adrian Pettitt's picture
Thu, 22/05/2014 - 15:36

We know Hove Park and we think that even they know that capital funding can be smoke and mirrors. Hove Park seems miffed that it failed with a bid to the capital fund for LA schools and cites this as a reason to convert to an academy and bid to the academy capital fund but it admits that the max bid for academies is £4M and that the bid still might not be successful. Secondly, while the school is adamant that it won't be a sponsored academy it only used pictures of sponsored academies to illustrate the capital advantages of conversion - - so adding to the confusion since the school must know it won't get anything like the capital funds sponsored academies received. (This also begs the question: why couldn't the school find examples of convertor academy rebuilds to show?) Thirdly, , we know people who worked in the DfE who tell us that the case for capital funds has included a need to show evidence of growth. This tends to mean that schools in areas of demographic growth have a stronger chance of capital funding irrespective of their status. This may not always be true but, as you say, the allocation of capital funding is not clear and might not always be as beneficial to convertors as they might think. In the end the maths doesn't work: the overall capital pot is too small and Free Schools have to take a huge relative proportion of it because they need brand new (to them at least) buildings. As the number of academies increases the pressure on the remainder of the academy capital budget must increase while, almost ironically, the pressure on the LA pot decreases. This won't stop funds being moved about to compensate but it would seem even potential convertor academies can't really assume that capital funding will follow conversion. So why do it?

Sarah's picture
Fri, 23/05/2014 - 15:07

The idea of a single capital pot across an area was of course a recommendation of the James Review which was quietly dropped by the government - presumably because it didn't want to give any greater leverage to local authorities which would be the only sensible 'responsible body' to coordinate it.

DFC was reduced by 80% and capital to local authorities by 60% so local authorities' ability to maintain and replace the estate has been significantly constrained since 2010. Levels of local funding for capital maintenance should return to pre-2010 levels. Local areas should decide local priorities for investment - not the DfE from Whitehall. Sadly it looks as though this will only get worse with the Priority School Building Programme mark 2.

Although there has been a three year allocation for basic need capital (for extra places) the same is not true for other capital ie capital maintenance. That is still coming in one year allocations which is not a sensible way to handle capital programmes. But the government are still (a year late) unable to produce a full set of condition data to give them confidence of allocating capital where it is most needed.

I certainly agree that local authorities should be able to direct all schools to expand where it is needed to meet demographic growth. The current situation is a nonsense. I also endorse wholeheartedly the idea that communities and not Michael Gove should decide what sort of schools they should have. Maintained schools should be on a level playing field with other categories and should be a choice for parents if they support the idea.

One anomaly that favours academies is that if schools vote to convert this element of the funding is removed from LA allocations in the next capital allocation but LA's are supposed to honour commitments made to those schools for investment - even if their allocations no longer include the pupils in those schools - and even though the newly converted academy can apply for Academy Capital Maintenance funding.

One of the big gaps in current capital funding arrangements is that there is no recognition of the capital maintenance needs of special schools which are quite different from mainstream schools. There is also no longer any funding available to address the suitability (as opposed to condition) of school buildings or to allow local authorities to replace school buildings in order to aid good planning ie to amalgamate schools where numbers are low.

Janet Downs's picture
Fri, 23/05/2014 - 16:06

Thanks, Sarah, I didn't realise the idea of a single capital pot had been recommended by James. A cynic might say multiple pots make it more difficult to keep track of which schools are getting what (that's what I've found during my forays into the capital funding jungle).

… – the complexity.[courtesy of Local Schools Network] ‘ If schools need maintenance or rebuilding, or if new places are required, there are now …

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