Show us the money, Mr Gove

Michael Gove has invited existing schools to become academies. But his new announcement explains nothing about the funding gaps for free schools and the pupil premium.

Michael Gove has been on the airwaves this morning talking about his letter to every headteacher inviting their schools to become academies. But this eye catching announcement is merely an attempt to blind commentators from the serious questions raised during the election campaign. Left Foot Forward examines the two big questions unanswered by the Coalition Government.

1. The new “free schools” are unfunded

In addition to inviting existing schools to become academies, the Coalition’s ‘programme for government‘ says, “We will promote the reform of schools in order to ensure that new providers can enter the state school system in response to parental demand”. Journalist Toby Young made a film for Newsnight about his plans to set up a new school in West London.

But during the election, the Institute for Fiscal Studies produced a briefing note on education policy which said:

“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’.”

In addition, education blogger Conor Ryan suggests that there are non-capital costs associated with free schools: “Because they will require surplus places in other schools at a time of falling rolls, they will cost at least £1 billion a year in revenue costs over and above their capital costs.”

The Coalition has done nothing to address these concerns.

2. The pupil premium is unfunded.

The coalition’s ‘programme for government‘ says, “We will fund a significant premium for disadvantaged pupils from outside the schools budget by reductions in spending elsewhere.” This is a significant climb down on the Liberal Democrats’ hard manifesto commitment to “invest £2.5 billion in this ‘Pupil Premium’ to boost education opportunities for every child.” And yet is is still unclear where the money will come from.

With spending tight across Whitehall, Mr Gove is unlikely to find the additional money from other spending departments. Indeed, on Monday George Osborne and David Laws announced £670 million in education cuts to pay down the deficit. During the election, Mr Gove was fond of pointing out that “just £32 billion” of the £68 billion Department for Education budget went on schools. Left Foot Forward debunked this showing that these so-called inefficiencies were actually teachers’ pensions, early years and childcare, education maintenance allowances and other youth services.

Indeed, the efficacy of the scheme is uncertain. According to the IFS, “the level of funding targeted at deprivation has increased rapidly in recent years, particularly in terms of the funding provided by local authorities.” They go on to conclude that, “any revenue-neutral or low-net-cost [pupil premium] option is likely to lead to significant numbers of schools experiencing large losses in per-pupil funding. Minimising such losses with additional public spending is likely to prove difficult given the level of fiscal restraint required over the course of the next parliament.” This prompted the Financial Times to report “doubts cast on ‘pupil premium’ proposals.” Even with the Conservative’s guarantee during the election that the pupil premium will “not be taken from other schools”, the IFS were only prepared to say that, “there is little more we can say about the Conservatives plans for a pupil premium.”

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