Michael Gove fails the schools’ funding test

The Conservative party's education plans are under scrutiny today. We are no wiser on how they would pay for their "free schools" or "pupil premium" policy.

The Conservative party’s education plans have been under intense scrutiny today. A Tory council leader said their “free schools” plan will need “paying for” while Labour bloggers and Ministers have set out which areas could face the chop to meet the Tories’ bill. As the update below shows, the IFS are also concerned by the Tories’ policies.

According to the BBC, “The Tory leader of Kent County Council, Paul Carter says the funding arrangements for free schools could mean council run schools will get less money.” Conor Ryan has suggested that the cost of the Tories’ “pupil premium” policy and the surplus required to make the “free schools” policy work will be £3.5 billion while Hopi Sen says quite simply that “‘free schools’ aren’t free”.

Shadow schools minister Michael Gove was challenged about this on the Today programme. He said:

“We want to ensure that the money not spent on schools is spent on schools … the total budget for the Department of Schools, Children and Families is some £68 billion. The amount that goes to local authorities not just to pay for schools but also to pay for pre-school provision and many of the many valuable functions that Paul [Carter] referred to is just £32 billion.”

The graph below shows what Michael Gove is excluding from his numbers (see Annex A of the DCSF report 2009). As outlined by Conor Ryan earlier today it includes teachers’ pensions, early years and childcare, education maintenance allowances and other youth services. Meanwhile, Ed Balls used a morning press conference to highlight that Tory education cuts would have to start this year and cited the Institute for Fiscal Studies‘ work on their National Insurance cut as evidence.

Michael Gove used the BBC interview to say:

“One of the points that the Liberal Democrats have very helpfully pointed out in their manifesto is that there is a significant amount of money that goes on education quangos and goes on central control of education that is wasted”.

The Lib Dem manifesto points to savings of £415 million from 2011-12 onwards from cutting education quangos and administration including replacing the Skills Funding Agency and the Higher Education Funding Council for England with a single Council for Adult Skills and Higher Education. The Tories have a similar policy to create a single Further Education Funding Council but this would still leave them with a black hole of at least £3 billion. Perhaps they would cut the entire administrative budget from the department and leave the running of education policy to the Big Society but that would only save an additional £177 million (Annex E).

Michael Gove is some way from passing the credibility test on his schools policy.

UPDATE 14.13:

The IFS have just published a report on education reform since 1997 and the three parties’ manifesto plans. It says:

“In response to our report analysing the options for a pupil premium, a Conservative spokesman was quoted as saying that ‘We have always said that any pupil premium will be extra money and will not be taken from other schools. This is still our position and we’ll release more details in due course. It will not involve taking money from other schools.’ Unfortunately, no further details were provided in their manifesto. In the absence of such details, there is little more we can say about the Conservatives plans for a pupil premium. It is impossible to quantify its likely impact on individual schools’ funding or overall levels of public spending…

“The Conservatives have proposed to fund these [“free school”] costs from the governments’ Building Schools for the Future budget (a capital fund set aside by the government, largely for the refurbishment of secondary schools). However, the Building Schools for the Future budget has not been set beyond 2011. Furthermore, under current plans, capital investment across all areas of government is due to be cut significantly as part of the fiscal tightening planned across the next parliament. Finding the money to fund an expansion in the supply of school places looks set to be a major challenge to the Conservatives’ proposed ‘schools revolution’.”

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