Title of report: Report seeking approval for Kirklees School Funding Formula for the financial year

Transcription

1 Name of meeting and date: Cabinet 15 th January 2013 Title of report: Report seeking approval for Kirklees School Funding Formula for the financial year Is it likely to result in spending or saving 250k or more, or to have a significant effect on two or more electoral wards? Is it in the Council s Forward Plan? Is it eligible for call in by Scrutiny? Date signed off by Director & name Is it signed off by the Director of Resources? Is it signed off by the Acting Assistant Director - Legal & Governance? Cabinet member portfolio Alison O Sullivan David Smith Vanessa Redfern Cllr Cath Harris Cllr Peter O Neill Children s Services Electoral wards affected and ward councillors consulted: All wards Public or private: Public 1. Purpose of report To report the changes required by DfE national funding rules to the Kirklees school funding formula for the allocation of Dedicated Schools Grant (DSG) to the maintained and academy schools in Kirklees for the financial year To report the development process undertaken in collaboration with head teachers through the Kirklees Schools Forum to formulate the details of the Kirklees school funding formula To recommend to Kirklees Cabinet the details of the Kirklees school funding formula for in terms of o the specific funding factors to be used o the relative weightings of factors o the values of the funding factors To request that the Cabinet approve the details of the Kirklees school funding formula for for submission to the DfE page 1

2 2. Key points 2.1 School funding changes for The Government intends to move towards a national funding formula for Local Authorities during the next spending review so that schools that are similar are funded comparatively wherever they are located in the country. As a first stage in this process, Local Authorities are required to revise their local funding formula to schools, so that as many services and as much funding as possible is delegated to schools. This will apply for the financial year onwards and maintained schools will receive their budgets using the revised methodology from April Academies will receive the revised funding from when their funding year starts in September LAs are required to simplify the local funding distribution formula so that all schools, including academies, are funded in a more consistent and transparent way. The funding methodology for meeting the special educational needs of children and young people is also being revised The change has major implications for individual schools, the organisation of the local school system and the Council as an employer and provider of around 25m of services to schools. The Dedicated Schools Grant (DSG) is approximately 311m in The school funding changes alter the way in which the DSG is allocated to schools. They are not intended to reduce the overall level of funding to schools. 2.2 The current local funding formula The current Kirklees funding formula for the distribution of the DSG has been developed over many years, in close collaboration between the LA and schools through the Kirklees Schools Forum. The Kirklees funding formula has many factors which allocate resources by a range of methods underpinned by a rationale to fund all schools fairly and to target resources at the specific needs of pupils in order to ensure that all pupils have equality of opportunity to achieve their potential. The main factors in the current Kirklees formula include those that distribute funding to schools; per pupil weighted by pupil age (the Age Weighted Pupil Unit AWPU) as a block grant to schools determined by school size per square metre of school building to fund the premises to support the legal Key Stage 1 class size limit of 30 pupils to support small primary schools to target disadvantage (assessed through free school meals entitlement) to target disadvantage (indicated by the Index of Multiple Deprivation-IMD) to support subject specialism in secondary schools to support special needs of pupils without statements of SEN to support the achievement of ethnic minority pupils to support the needs of pupils with low prior attainment to protect schools against overall losses of more than 5% per year due to falling pupil numbers to allocate former standards funds grants including the Excellence in Clusters initiatives page 2

3 The operational details of these factors, includes the proportion of funding allocated through each factor, the relative weighting between primary and secondary age groups and the sensitivity of each factor to the level of need it is addressing. The complex mix of factors has been built up over time as funding needs have been identified. Additionally, specific funding has been directed through ring fenced standards funds to meet evolving governmental priorities or to fund particular projects. Since 2004, major shifts in school funding have been smoothed by the application of a minimum funding guarantee which has ensured that all schools have received a guaranteed minimum increase in funding or, where relevant, that all schools receive a limited decrease in funding. The minimum funding guarantee has helped schools to make longer term plans, to manage change more effectively and to use resources more efficiently, and it has tended to lock the historical pattern of allocations into the funding formula such that the historical rationale for allocating some of the funding factors may no longer apply. The Kirklees formula is now complex and its underlying principles are not immediately clear and transparent 2.3 The main features of the new funding formula Funding is split into 3 blocks Schools block - the main funding for schools High needs block funding for aspects of special educational needs Early years block funding early years provision in all settings 2.4 The schools block The schools block has 12 allowable funding factors (a) a basic per-pupil entitlement - a single unit for primary aged pupils and a single unit for each of Key Stage 3 and Key Stage 4; (b) deprivation, measured by Free School Meals (FSM) and/or Income Deprivation Affecting Children Index (IDACI). (c) looked after children; (d) prior attainment (included as a proxy measure for SEN) (e) English as an additional language, for a maximum of 3 years after the pupil enters the statutory age school system. There can be separate unit values for primary and secondary; (f) pupil mobility; (g) a standard lump sum for each school, with an upper limit of 200,000; (h) school split sites ; (i) rates, which must be funded at actual cost; (j) private finance initiative (PFI) contracts; (k) for the 5 LAs with some schools within the London fringe area, an uplift to enable higher teacher pay scales in those schools to be reflected; and (l) a per-pupil factor for post-16 pupils up to the level that the authority provided in In addition there is an exceptional factor funding some costs of rented premises The schools block uses a standard data source the DfE supplies all of the pupil eligibility data for the above funding factors, based on the October pupil census rather than January pupil census as in previous years. page 3

4 2.4.3 The majority of funding for schools now has to be fully delegated - some budget items which can currently be retained centrally have to be delegated through the formula from (a) the additional cost of teachers threshold and performance pay; (b) practical learning options; [already delegated in Kirklees] (c) support for school meals [primary/special; secondary is already delegated]; (d) support for schools in financial difficulties; (e) allocation of contingencies; (f) administration of free school meals eligibility; (g) insurance; [already delegated in Kirklees] (h) licences/subscriptions; [already delegated in Kirklees] (i) staff costs supply cover (long-term sickness, maternity, trade union and public duties); (j) support for minority ethnic pupils or underachieving groups; (k) behaviour support services; and (l) library and museum services. It is possible to de-delegate some of these budgets to provide central services for maintained schools (but not academies) after the formula calculation has been made, under the following headings; i. contingencies (including support for schools in financial difficulties, new/closing/amalgamating schools, closing school deficits); ii. administration of free school meals (FSM) eligibility; iii. insurance; iv. licences/subscriptions; v. staff costs supply cover (long-term sickness, maternity, trade union and public duties); vi. support for minority ethnic pupils or underachieving groups; vii. behaviour support services; and viii. library and museum services. 2.5 The high needs block funds the additional costs of high needs pupils with Special Educational Needs in mainstream schools, special schools, other specialist provision and alternative provision including Pupil Referral Units (PRUs). High needs pupils are defined as those requiring more than 10,000 of provision. The funding methodology for pupils with SEN in mainstream schools and for special schools, other specialist provision and alternative provision needs to be completely restructured. 2.6 The early years block funds all provision for children below school age in a range of settings school based nurseries, private voluntary and independent provision. The government is not proposing major changes to the main elements of the Early Years Single Funding Formula (EYSFF). 3. Progress with developing the new formula The overview of the development process has been reviewed at the Learning Board. page 4

5 LA finance officers, working closely with the Kirklees Schools Forum have developed a draft local formula. The details of this process have been tested at each stage with head teacher groups and been the subject of briefings for school governors Intensive work has taken place to map the current funding factors into the new formula factors. The new factors have been modelled to give illustrative individual school budgets. In the light of feedback from head teachers, the model has been modified to moderate some of the larger swings in funding. Further models have been developed to illustrate a different balance of funding factors. 3.1 The meeting of the Kirklees Schools Forum on 26 th October (see Appendix 1 for minutes) agreed to recommend that the Kirklees funding formula should contain the funding factors shown in Table 1 below and that these should be submitted to the Education Funding Agency (EFA) Table 1. Kirklees funding factors recommended by the Kirklees Schools Forum Funding factor Data source Primary sector Primary AWPU Reception Yr 6 pupils Oct census Secondary sector KS3 AWPU Yrs 7 9 pupils Oct census KS4 AWPU Yrs pupils Oct census Deprivation: Free School Meals Ever 6 FSM percentages Deprivation: Income Deprivation Affecting Children Index IDACI bands 1 6 Looked-after Children LAC last census only Low Prior Attainment Primary Pupils EYFSP score < 78 Low Prior Attainment Secondary Pupils Level 3 or below in both English and Maths at KS2 English as an Additional Language EAL pupils last census only Pupil Mobility Children on census with start date at school not in Aug/Sept Common lump sum Common value for all schools Split-site funding School premises separated by a public highway Business rates Matched to actual rates bill PFI factor: swimming pools On-site pool running costs n/a PFI factor: funding gap* Premises rentals (exception factor) *See paragraph 4.8 and Appendix 7 for full details From Council funds PPP1 contractor cost less school s current contribution Matched to annual premises rents including modular buildings No page 5

6 The meeting also confirmed recommended actions for the delegation of centrally retained DSG budgets. These are shown in minute 5.2 in Appendix 1. Agreement to de-delegate budgets was decided by representatives of maintained schools only, as specified in the Schools Forum regulations. 3.2 Indicative school allocations using the preferred model were circulated to schools in early November 2012 and all elected members were provided with a detailed written briefing (see Appendix 2) 3.4 The meeting of the Kirklees Schools Forum on 14 th December 2012 (see Appendix 3 for minutes) agreed to recommend that the factors in the Kirklees funding formula should have the weightings and values shown in the meeting paper attached as Appendix 4. The meeting also re-confirmed the recommendations for the delegation of centrally retained DSG budgets, with the de-delegations for maintained schools listed below Free school meals eligibility check Maternity & paternity leave Public/union duties (primary maintained schools only) International new arrivals support service Nurture groups (phased support) School specific contingency 4. The impact on schools of the new funding formula 4.1 The indicative distribution of the DSG Using the DSG funding totals, the new formula allocates the resource as shown in table 2 below. Table 2 : Indicative distribution of DSG using values Schools block 263m 84.7% Early years block 18m 5.7% High needs block 27m 8.7% Retained 2.8m 0.9% total 311m 4.2 The distribution of DSG by the main funding factors Table 3 shows the relative distribution of the schools block DSG funding within the primary and secondary phases using the proposed Kirklees funding formula Table 3 : Schools block distribution primary secondary Age weighted pupil unit 64.7% 81.5% Deprivation 9.4% 8.3% Low prior attainment 9.5% 5.7% English as an additional language 1.3% 0.1% Pupil mobility 0.4% 0% Lump sum 13.2% 3% page 6

7 4.3 The primary : secondary ratio The ratio of primary : secondary funding per pupil has been maintained at the value of 1: Table 4. Primary to secondary ratios primary secondary ratio pri to sec number of pupils 34,584 22,459 1 to 0.65 total funding 145m 118m 1 to 0.81 funding per pupil 4,204 5,269 1 to The potential impact on schools The changes in funding at school level that the new funding formula models produce are varied and in some cases very significant. The size of the changes could be amended to a small extent by adjusting the weightings and values of the formula funding, but the overall direction of change resulting from the simplified formula was generally consistent across the various iterations of the funding models. The weightings and values of the factors in the recommended model give; variations for primary schools ranging from a reduction of 149,000 to an increase of 236,000 variations for secondary schools ranging from a reduction of 530,000 to an increase of 506,000 The underlying pattern of allocations produces some general outcomes that cannot be mitigated by manipulating the weighting of the new funding factors. These are addressed in the impact assessment - see Appendix 5. historical targeted blocks of funding cannot be replicated eg specialist schools funding, Excellence in Clusters grant funding size : very small primary and small secondary schools have reduced funding whereas larger primary and secondary schools gain (due to the effect of a single lump sum replacing all school related factors for all schools) unfilled places : schools with unfilled places lose funding deprivation : primary and secondary schools with higher levels of deprivation receive reduced funding (due to the historical patterns of funding) minority ethnic population : schools with higher numbers pof minority ethnic pupils tend to receive reduced funding due to the change to an EAL factor which is limited to the first 3 years of schooling) 4.5 Managing the changes the minimum funding guarantee The minimum funding guarantee limits the loss to a school to 1.5% per pupil per year for the next 2 years. The government has indicated that some guaranteed maximum reduction per pupil is likely to remain after but the scale of the limit is unknown. The minimum funding guarantee limits the potential reductions at schools where there is a predicted reduction in funding; page 7

8 Approx 1/2 of Kirklees primary schools would expect a reduction in funding per year of 9,500 on average, with a maximum of 31,000 Approx 1/2 of Kirklees secondary schools would expect a reduction in funding per year of 42,500 on average, with a maximum of 53,000 It is important to note that the minimum funding guarantee does not protect a school budget which is reducing due to a fall in pupil numbers. Such a reduction has been damped in the current funding formula through the 5% loss protection factor. A significant reduction in pupil numbers is likely at some secondary schools as the pupil cohort size changes. The minimum funding guarantee limits any potential reduction to the budgets of schools predicted to receive a reduction in funding and this protection is funded from the resource available to increase the budgets of those schools predicted to receive an increase in funding. The minimum funding guarantee therefore damps both increases and decreases in funding. 4.6 Indicative school budgets for (see Appendix 2) The overall changes in school budgets for are affected by 3 factors; the changes due to the new formula funding methodology, limited by the minimum funding guarantee, the newly delegated resources noted in section 3.1, the increase in value of the pupil premium from 623 to 900 per eligible pupil (a pupil who has been eligible for free school meals at any time in the last 6 years) The indicative figures in Appendix 2 suggest that schools will see very limited changes in funding for However additional responsibilities and costs have been delegated to schools which will require additional planned budget expenditure. 4.7 The implications of the long term direction of schools block funding allocation to schools The new funding formula methodology produces significant increases and reductions in school allocations. Schools will need to use the smoothing protection of the minimum funding guarantee limitation on funding changes to agree and implement a resource management strategy to maintain efficient use of resources and in some cases to remain viable and sustainable. The Kirklees Schools Forum will review its approach to the scrutiny of school balances. 4.8 High needs block funding : new funding arrangements for learners with special educational needs in mainstream schools The agenda paper 8 for the Schools Forum meeting on 14 th December 2012 (see Appendix 6) describes progress in developing the funding methodology for pupils with SEN in mainstream schools. A high needs pupil is identified by DfE as one requiring provision costing 10k or more page 8

9 The schools block delegated funding will be expected to provide AWPU funding plus the first 6k of a statement Schools will receive top up funding for statements above 6k from the central high needs block 4.9 High needs block funding : new funding arrangements for learners with special educational needs in specialist SEN settings. Place-Plus funding. Schools will receive base funding of 10,000 for an agreed number of planned places. This will be the only factor that can be used in setting the place-led funding of a specialist setting. This will ensure that: o There is broad equivalence of funding for high needs provision across mainstream and specialist setting; and o All pre-16 specialist high needs provision is funded on an equivalent basis. Settings will receive top-up funding from the high needs block to meet the needs of pupils placed in the setting, provided direct to the setting from the local authority, based on the pupil s assessment of needs Early years block funding There are no major changes proposed The LA will now be funded for these pupils on the basis of termly counts rather than just the January census A minimum funding guarantee of -1.5% applies to hourly base rate The LA will continue to fund all providers including academies An additional 4.3m funding for 2 year olds will transfer to the DSG from 2013/ Kirklees PPP schools Under the PPP schools agreements there is a requirement that, should there be a significant change to the way that schools are funded during the span of the contract, the parties must agree amendments to the affected clauses to re-express the basis for payment of the annual school contribution fee. Work is under way to amend the schools agreements so that they are in place for the start of financial year when the new formula funding arrangements begin to apply. The Council will be seeking to maintain the individual level of contribution (uplifted for inflation each year) that each school is already making under the current funding arrangements. As a result of additional cost pressures within the PPP1 contract, the Council has established a budget provision to meet the extra cost which the contractor can claim. The DfE instruction is for this budget and the associated cost responsibility to be delegated to the schools and academies covered by the contract. It is therefore intended to use the Council budget in question to add to the overall schools budget and use this funding to create a new PFI funding factor to fund each of the 19 PPP1 schools for the current cost of service at their site. (See section 3.1) page 9

10 5. Implications for the Council 5.1 Council priorities Council policies affected by this proposal include the Children & Young People Plan. The proposals will support the Council priorities which are to; Enhance life chances for young people Working in partnership to improve educational attainment for the under 16s and help them to reach their full potential. The proposals will have potentially varied impacts on the capacity of schools and settings to offer the opportunity to continue to significantly improve and enhance the overall educational opportunities and achievements of young people in Kirklees. Business growth and jobs Creating the right conditions for business to sustain the Kirklees economy, facilitating investment in skills, jobs and homes and providing pathways into work. The change has major implications for the Council which will have to develop its trading relationship with all schools to encourage schools to buy back services and maintain the sustainability of council provision. Provide effective and productive services Ensuring services are focused on the needs of the community and are excellent value for money The change has major implications for the Council which will have to develop its trading relationship with all schools to encourage schools to buy back services and maintain the sustainability of council provision. Support older people to be healthy, active and involved in their communities Helping people to improve their health and well-being. We will focus on preventative work and empowering people to make informed decisions 5.2 Equality Implications The draft equality impact assessment attached in Appendix 5 sets out the potential positive, neutral and negative impacts of the changes in the school funding system. The DfE Equality Impact Assessment provides a rationale for the simplified range and scope of funding factors that is clear and transparent. The implementation of the new funding formula will need detailed monitoring and evaluation to inform the process of adjusting the formula for and subsequent years. 5.3 Human Resources implications The impact of the new funding formula at school level has the potential to generate significant longer term increases and reductions in funding for schools. The largest element of school budgets is staffing. Major changes in funding are likely to therefore lead to HR implications at individual schools as funding is redistributed between schools, within any national funding constraints at LA level. 5.4 Financial Implications The Dedicated Schools Grant is largely allocated directly to schools, but a significant sum is used by schools to purchase council services. The simple buyback mechanism that has operated will no longer apply as the majority of funding has to be delegated to schools. page 10

11 The Council will have to develop its trading relationship with all schools to encourage schools to buy back high quality, value for money services and maintain the sustainability of council provision. The PPP funding arrangements for the council have to be restructured. This is intended to be cost neutral for the Council. 6. Consultees and their opinions The Learning Board has monitored the progress of the new funding formula. Kirklees LA has developed the new funding formula in collaboration and consultation with the Kirklees Schools Forum, which is the statutory consultative body regarding school funding and has representatives from all the Kirklees maintained school phase groups as well as academy schools. These representatives have consulted in turn with head teachers of all Kirklees schools. The minutes of the meetings of the Kirklees Schools Forum are attached as Appendices 1 and 3. A briefing paper has been circulated to all elected members (Appendix 2) Briefing/consultation meetings have taken place with school governors. 7. Officer recommendations and reasons Cabinet is recommended to note the changes required by DfE funding rules to the Kirklees school funding formula for the allocation of Dedicated Schools Grant (DSG) to the maintained and academy schools in Kirklees for the financial year note the consultative development process undertaken in collaboration with head teachers through the Kirklees Schools Forum to formulate the details of the Kirklees funding formula note the details of the preferred Kirklees funding formula for in terms of o the specific funding factors to be used o the relative weightings of factors o the values of the funding factors approve the details of the Kirklees school funding formula for for submission to the DfE 8. Cabinet portfolio holder recommendation To support the officer recommendations above 9. Key dates and next steps 4 th Oct: school census date. 2013/14 formula funding will be based on this data. 31 st October : LA to submit proposed funding formula factors to EFA Dec 2012: Dataset to be provided by DfE & EFA to confirm 13/14 DSG allocations Jan 2013: LA to submit final data for schools budget pro-forma to EFA Feb 2013: Final Council budget decisions Feb - Mar: LA to confirm budgets for their schools page 11

12 10. Contact officer and relevant papers Warwick Firmin Senior Manager School Organisation and Planning Civic Centre warwick.firmin@kirklees.gov.uk Carole Hardern Strategic Council Finance Manager Civic Centre carole.hardern@kirklees.gov.uk 11. Assistant Director responsible John Edwards Assistant Director for Learning Directorate for Children and Young People Civic Centre John.edwards@kirklees.gov.uk Gill Eastwood Assistant Director, Financial Management Risk and Performance Directorate Finance Resources Civic Centre gill.eastwood@kirklees.gov.uk 12 Relevant papers DfE Equality Impact Assessment page 12

13 APPENDIX 1 Minutes of the KIRKLEES SCHOOLS FORUM meeting Friday 26 th October 2012, 10:30am at the Deighton Centre Present: Julie Helm Nursery School Heads (1) Kath Benetis, Richard Dodd, Michelle Lee [Chair], Jane Richardson, Diana Wilson Primary School Heads (7) Gary Johnson Middle School Heads (1) High School Heads (3) Richard Ware Special School Heads (1) Mike Cook, John McNally (vice-chair) Academy Heads (2) Martin Ridge Pupil Referral Units (1) Pat Colling Kirklees Governors (1) Jo Bailey-Taylor (NASUWT), Gillian Collins (ATL), Sarah Ellis (Pre- School Learning Alliance), Howard Roberts (NUT) Warwick Firmin (School Funding Strategy Manager) [Clerk] David Gearing (Financial Delegation Manager); [Minute Clerk] Carole Hardern (Group Finance Manager) David Smith (Director of Resources) Gavin Monument (Education Funding Agency), Cllr Peter O Neill, Simon Sloan (KPH), Alison Whiteley (ATL, shadowing Gillian Collins) Non-school members (5) Officers in Support Observers 1. Review of membership The agenda papers contained a summary listing of all current Kirklees Schools Forum members, which constituency they each represent and a note of when their term of office ends. The list now requires amendment to reflect extensions to the terms of office of one of the Primary head teacher representatives and the ATL representative. The Schools Forum currently has a vacancy for a Partnership representative. The table also shows which Council Officers support the Schools Forum in discharging their responsibilities (see item 4 below). 2. Apologies for Absence Apologies were received from John Edwards (Asst Director for Learning), Angela Farmer (Finance & Performance), Kevin Higgins (KHSH) and Sarah Wild (KHSH). 3. Election of Chair and vice-chair Nominations were sought from the membership to serve as the Schools Forum Chair and vice- Chair. The only nomination received for the Schools Forum Chair was for Michelle Lee. The only nomination for vice-chair was for John McNally. Both proposals were duly seconded and Michelle and John elected to serve in the capacity of Chair and vice-chair respectively for the remainder of Academic Year 2012/13.

14 APPENDIX 1 Minutes of the KIRKLEES SCHOOLS FORUM 26 October 2102 page 2 of 7 4. Schools Forums: powers and responsibilities The agenda papers contained a table detailing from the Schools Forum regulations the powers / responsibilities of the Schools Forum as applicable to financial year issues. The table also shows how the local authority and the Department for Education fit in with each aspect of the Schools Forum s functions. For example, the main items on today s agenda concern the government s school funding reforms in setting the new school funding formula the local authority must consult with its Schools Forum but the ultimate decision rests with the LA. However, on the matter of which budgets can be de-delegated, the LA can only propose, the decision rests with Primary and Secondary Schools Forum members to decide on the pattern of de-delegation for their phase. 5. Recommendations re retained Dedicated Schools Grant (DSG) budgets 5.1 Feedback from Schools Forum Briefing The agenda papers contained a report from earlier Schools Forum briefing meetings summarising the positions reached, following feedback from phase groups, on each of the currently-retained DSG budgets. Since the report was prepared there has been further information shared with the Schools Forum briefing and phase groups. The meeting was given an update on developments School Safeguarding Officer This provision is now proposed to be retained under the Contribution to Combined Budgets heading as it is a DSG contribution to a wider Children & Young People Directorate function. Nurture Groups feedback from Kirklees Primary Heads is that the funding should be withdrawn over three financial years. This would entail de-delegation of two thirds of the provision in , one third in and nothing in (assuming the DfE rules governing permit this approach). School Milk this budget will also need to move under the Contribution to Combined Budgets heading to continue to be retained. Free School Meals Eligibility Checks it is proposed to use a working figure of 65k dedelegation in the EFA Funding Change pro forma. School Admissions in the absence of a firmer figure it is proposed to include an estimate of 50k released to Schools Block delegation when completing the form. Public / Trade Union Duties following the provision of further information on how trade union facility time works and the benefits that such an arrangement brings in terms of avoiding far larger potential costs, the consensus view now appears to be lining up behind de-delegation. KHSH has still to review their position in the light of the new information though their previous view on this was that the provision should be reduced before dedelegation takes place. In the meantime, it is proposed that the EFA pro forma be completed assuming full de-delegation of the existing level of provision. Termination of Employment costs - the amended proposal is that the 40% element of the budget which relates to provision for new costs is moved into the de-delegated contingency budget to supplement the original Schools in Financial Difficulty sum. VER and severance would be one potential tool for helping schools reduce their spending profile to address budget difficulties Minutes Schools Forum Public 26Oct12 PUBLIC.docx

15 APPENDIX 1 Minutes of the KIRKLEES SCHOOLS FORUM 26 October 2102 page 3 of Confirmation of recommendations of retained DSG budgets The actions in the table below were agreed. References to de-delegation apply to maintained schools and not academies. Budget Former Threshold & Performance Pay Grants Contingencies School Safeguarding Officer Contributions to Combined Budgets Behaviour Support Services Underperforming ethnic groups / bilingual learners School Milk Free School Meals eligibility checks Kirklees Interfaith School Admissions Action agreed Delegate 8.48m to schools across Primary, KS3 and KS4 AWPUs Prior to the calculation of School Budget Shares establish a Pupil Growth Fund of 600,000. Delegate 2.26m to schools across Primary, KS3 and KS4 AWPU then de-delegate funds to create a schools contingency of 813,600 (this includes VER/severance provision of 113,600 transferred from the Termination of Employment costs heading Continued retention of 48,400 under the Contribution to Combined Budgets heading Delegate 143k to schools via AWPUs [the budget has hitherto supported central co-ordination of Every Child Counts, Every Child a Reader and One-to-one Tuition programmes] Include budgets for School Safeguarding Officer and School Milk Continued retention of funding for looked-after children / children not in education and intervention budgets administered by the Learning Service Delegate Nurture Groups budget ( 251k) to schools via AWPUs, then de-delegate sufficient funds in to allocate reduced amounts to the affected primary schools in line with phasing out over three years Move the remaining budgets ICAN, Autism Outreach, Portex and Inclusion Placements into the High Needs Block Delegate 294k budget to schools via AWPUs then de-delegate an amount based on 100k to fund a new central support service for schools for international new arrival issues. Academies will be able to buy into the new service. Move the 26k budget element not covered by EU grant to Contribution to combined budgets Delegate the 101k budget to schools via AWPUs then de-delegate an amount based on 65k to provide the service centrally for maintained schools with academies also able to buy into the service. [The de-delegation amount quoted is a working figure the cost to Customer & Exchequer Services of covering the task has still to be settled] Delegate the 66k budget to schools via AWPUs. The service will move to full trading with schools Free up for delegation to schools via AWPUs a portion of the temporary 100k support allocation. Amount to be decided, an interim working figure of 50k to be used for the pro forma Minutes Schools Forum Public 26Oct12 PUBLIC.docx

16 APPENDIX 1 Minutes of the KIRKLEES SCHOOLS FORUM 26 October 2102 page 4 of 7 Budget Lifting & Handling Adviser Head Teacher Wellbeing Service Maternity / Paternity Leave Public / Union Duties Termination of Employment costs Action agreed Budget moved to the High Needs block Delegate the 43k DSG contribution to schools via primary AWPU. The service will need to trade with schools as a result Delegate the 1.03m budget to schools via AWPU then de-delegate the maintained schools share to enable the risk of maternity costs to be pooled Delegate the 372k budget to schools via AWPU then de-delegate the maintained schools share. The KHSH view (in terms of the amount) has still to be clarified. The EFA pro forma will report dedelegation applied to the full budget amount. Academies position still to be considered 60% of this budget to be retained to meet ongoing pension commitments, the remaining 40% ( 113,600) moved to contingencies for subsequent de-delegation and addition to the schools in financial difficulty section of the pooled contingency. 6. Schools Block funding factors 6.1 Feedback from Schools Forum briefing working party A series of formula models have been considered over the last several weeks by the Schools Forum working group and by constituent groups. A couple of examples were included with the agenda papers today. It is acknowledged that movement away from a complex formula which contains many targeted funding allocations to a much-simplified arrangement with a restricted number of factors will inevitably produce some significant funding redistribution effects. These effects are apparent, to varying degrees, in all of the models run. For example, the movement away from a system which allocates premises funding via the size of school buildings to one where premises are funded via the number of pupils in them will always disadvantage schools with spare building capacity no matter what proportions of the funding are allocated between the limited number of available formula factors. The consultation meetings held to date have produced the list of formula factors outlined in the table below Minutes Schools Forum Public 26Oct12 PUBLIC.docx

17 APPENDIX 1 Minutes of the KIRKLEES SCHOOLS FORUM 26 October 2102 page 5 of Confirmation of recommended funding factors in Schools Block for submission to the Education Funding Agency (EFA) Funding factor Data source Primary sector Primary AWPU Reception Yr 6 pupils Oct census Secondary sector KS3 AWPU Yrs 7 9 pupils Oct census KS4 AWPU Yrs pupils Oct census Deprivation: Free School Meals Ever 6 FSM percentages Deprivation: Income Deprivation Affecting Children Index IDACI bands 1 6 Looked-after Children LAC last census only Low Prior Attainment Primary Pupils EYFSP score < 78 Low Prior Attainment Secondary English as an Additional Language Pupil Mobility Pupils Level 3 or below in both English and Maths at KS2 EAL pupils last census only Children on census with start date at school not in Aug/Sept Common lump sum Common value for all schools Split-site funding School premises separated by a public highway Business rates Matched to actual rates bill PFI factor: swimming pools On-site pool running costs n/a PFI factor: funding gap Premises rentals (exception factor) From Council funds PPP1 contractor cost less school s current contribution Matched to annual premises rents including modular buildings No It was agreed that the above position should be submitted to the Education Funding Agency Minutes Schools Forum Public 26Oct12 PUBLIC.docx

18 APPENDIX 1 Minutes of the KIRKLEES SCHOOLS FORUM 26 October 2102 page 6 of 7 7. Schools Block funding factor values 7.1 Feedback from Schools Forum Briefing Working Party Following the sharing of various formula funding models with the Schools Forum working group and constituent groups over a series of meetings, the feedback received enabled an eighth version to be constructed. Known as third draft, this model combines the shape of the first draft (amended) model for secondary allocations and the second draft model (with some amendments) for primary allocations as the broad consensus within the sectors favoured these models. The meeting was reminded of how the third draft model operates. The unit values within the third draft are set out in the table below. 7.2 Confirmation of indicative Schools Block funding factor values for submission to the EFA Formula factor Primary school / pupil unit values AWPU Primary 2, Secondary school / pupil unit values AWPU KS3 3, AWPU KS4 4, Deprivation: Free School Meals Deprivation: IDACI band Deprivation: IDACI band Deprivation: IDACI band Deprivation: IDACI band Deprivation: IDACI band , Deprivation: IDACI band , Looked-After Children 1, , Low Prior Attainment 1, , English as an Additional Language Pupil Mobility Common lump sum 130, , Split-site block 7, , Business rates Equivalent to bill Equivalent to bill PFI factor: swimming pools n/a 28, per pool PFI factor: funding gap Individual amount Individual amount Premises rentals Equivalent to annual rent Equivalent to annual rent It was agreed that the above unit values should form the basis for completion of the EFA School Funding pro forma Minutes Schools Forum Public 26Oct12 PUBLIC.docx

19 APPENDIX 1 Minutes of the KIRKLEES SCHOOLS FORUM 26 October 2102 page 7 of 7 The pro forma will also have to build in the effects of the newly-delegated amounts (on top of the AWPU values showing in the table) and show the de-delegation effects for maintained schools. The new delegation will maintain the existing primary: secondary overall per pupil funding ratio of 1: The meeting was reminded that the submitted unit values are still draft at this stage. Another pro forma has to be returned to the EFA by 18 th January 2013 which will finalise the unit values for budget allocations. 8. School Funding Reform: proposed timeline for engagement The Funding Reform response pro forma setting out the formula factors referred to above has to be submitted to the EFA by the close of 31 st October This sets the shape of the local funding formula but does not finalise the unit values attached to each factor. A new school data set, based upon October 2012 census information, will be provided by the DfE on 10 th December The authority then has until 18 th January 2013 to submit a final pro forma return for the unit values that will apply to the Schools Budget Share allocations. The 14 th December Schools Forum meeting will need to consider these final unit values. There then needs to be a Council Cabinet decision following that meeting before the values are notified to the EFA mid- January. In the meantime, it is intended in November and December to hold open briefing sessions on the Funding Reform changes for head teachers, business managers and governor representatives. There will also be a similar briefing session(s) arranged for Council Members. A timetable for the above will be publicised once the dates and venues have been fixed. 9. Report from Excess Balances Sub-group A summary report from the Schools Forum Excess Balance Sub-group was considered. The subgroup has met on two occasions to consider evidence from each of the 32 schools which presented an excess balance position at the close of financial year as to how the school plans to return to an acceptable reserve balance level. For 31 of the schools concerned their balance plans have been approved by the sub-group with further details requested from the final school in terms of a firm commencement date for their ICT project. The Schools Forum was asked to note the outcomes and approve the actions taken by the sub-group. The recommendations were agreed. 10. Future meetings of the Kirklees Schools Forum th December 2012 Confirmation of recommended funding factor values 15 th March th July Any other business No other business was raised. 12. Public comments / questions After the formal business of the day was concluded members of the public in attendance were given the opportunity to make comments or ask questions of the Schools Forum. The only comments made were around whether there had actually been proper consultation about the funding changes and whether the schools of the Schools Forum head teachers were all gainers. The Chair responded by saying that all schools had had the opportunity to attend a series of meetings about the changes and that there was actually a mixture of winners and losers amongst the schools managed by The Schools Forum members. The Schools Forum has endeavoured to look at the big picture issues with this task rather than pursuing individual interests Minutes Schools Forum Public 26Oct12 PUBLIC.docx

20 APPENDIX 2 SCHOOL FUNDING REFORM : BRIEFING NOTE FOR MEMBERS : 12 TH NOVEMBER 2012 SUMMARY The DfE is establishing a new local funding formula for that has a limited range of nationally set factors that can be locally adjusted to target resources towards priority needs. Officers have developed a new formula through successive modelling of a range of variations within the allowable formula factors. The developing formula has been tested through the School Forum with Head Teachers The likely long term impact on individual schools varies from very significant gains` (up to approx 500,000) to major losses (up to approx 500,000) BUT the immediate impact in is cushioned by the minimum funding guarantee of a maximum loss of 1.5% in per pupil funding as well as increases in pupil premium allocations. A new approach to funding special needs is also being established from The new school budgets will be designed to meet the first additional 6000 of the special needs of all pupils in the school. Additional top up funding will only be available for small numbers of high needs pupils. Special schools will be funded for places with similar top-ups for high needs pupils The new funding methodology delegates most services and some additional funding to schools and so Governing Bodies will have more responsibilities. SCHOOL FUNDING CHANGES FOR The Government intends to move towards a national funding formula for LAs during the next spending review. From April 2013 Local Authorities are required to simplify their local funding formula to schools. o o As many services and as much funding as possible to be delegated to schools. LAs to simplify the local funding distribution formula so that all schools, including academies, are funded in a more consistent and transparent way. The change has major implications for individual schools, the organisation of the whole school system and the Council as an employer and provider of around 25m of services to schools The change has major implications for the Council which will have to develop its trading relationship with all schools to encourage schools to buy back services and maintain the sustainability of council provision. LA officers, working closely with the Kirklees Schools Forum have developed a local formula, which has received feedback from headteacher groups. The funding formula has had to be submitted to the DfE by 31 st October. There is still some room for adjustment to values of the funding factors. WHAT ARE THE MAIN FEATURES OF THE NEW FUNDING FORMULA? Pupil-led funding most funding is allocated according to the number of pupils on roll through an Age Weighted Pupil Allowance (AWPU). Reduced sensitivity the new formula is limited to 11 basic factors rather than the nearly 40 factors in the current Kirklees formula (which target funding to specific cost areas such as premises and KS1 class size). The main funding factors in the new formula that can have agreed local weighting are:- deprivation (allocated by free school meal entitlement and IDACI - the Income Deprivation Affecting Children Index) looked after children low prior attainment (intended to include much special needs funding) English as an additional language (for the first 3 years of schooling only) pupil mobility a single value lump sum for all schools from the smallest primary to the largest secondary Standard data source for LAs the DfE supplies all of the pupil eligibility data, based on the October pupil census rather than January pupil census. SEN funding the new approach to funding for children with Special Educational Needs assumes that the AWPU and the first 6,000 of the special needs of any pupil is included in the basic school budget allocation derived

21 APPENDIX 2 partly from the deprivation and low prior attainment formula factors as well as the AWPU. Additional top up funding is only going to be available to meet the needs of relatively few high need pupils. WHAT IS THE IMPACT ON KIRKLEES SCHOOLS? Turbulence the long term changes when fully implemented would create potentially significant increases or reductions for some schools. The new funding factors have been modelled and refined to moderate some of the larger swings in funding and to ensure better targeting. The flexibility to reproduce current funding allocations is limited The long term changes for primary schools range from reductions of approx 166,000 to increases of approx 236,000. (These figures are based on January census of pupil numbers). (Note Ashbrow primary is a special case due to changes in school organisation.) The long term changes for secondary schools range from reductions of approx 530,000 to increases of approx 510,000. (These figures are based on January census of pupil numbers). School level figures are shown in the attached spreadsheet in the yellow highlighted column labelled Eventual funding cash difference Protection for the next 2 years through the Minimum Funding Guarantee which limits losses to 1.5% per pupil per year. The DfE are committed to continue the minimum funding guarantee beyond but are not able to specify the maximum annual loss. For the primary schools who are likely to receive a reduced allocation, the average reduction is approximately 9,500 and the maximum reduction is approximately 31,000 per year. For the secondary schools who are likely to receive a reduced allocation, the average reduction is approximately 43,000 and the maximum reduction is approximately 53,000 per year. (Note Westborough High School is a special case due to changes in school organisation.) School level figures are shown in the attached spreadsheet in the blue highlighted column A labelled Phased MFG difference in Actual school budgets for see attached spreadsheet column D Schools will also see an increase in pupil premium payments in (mauve highlighted Column B labelled Est Pupil Premium increase at 281) and some additional delegated funding LESS Teachers Pay Threshold Costs (grey highlighted column C labelled New Delegation (LESS) De-delegation (LESS) Teachers Pay Threshold Costs ) The actual cash value reductions in budgets will be relatively small see attached spreadsheet column D IMPORTANT DATES February 2013 School budget shares set SUPPORT FOR SCHOOLS AND GOVERNORS dates to be announced Nov /Dec 2012 Feb / Mar 2013 Briefing meetings and workshops for Heads, Governors (including SEN Governors) and Business Managers Individual budget setting meetings for Head teachers and school Business Managers FURTHER INFORMATION Angela Farmer, Senior Finance Officer, Resources David Gearing, School Delegation Manager, Resources