Document GK Appendix 1 CONSULTATION & INFORMATION ON PRIMARY & SECONDARY FUNDING FORMULAE 2017/18 FINANCIAL YEAR

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1 Dcument GK Appendix 1 CONSULTATION & INFORMATION ON PRIMARY & SECONDARY FUNDING FORMULAE 2017/18 FINANCIAL YEAR 1. Intrductin and Summary 1.1 The key message DO NOT PANIC has been cmmunicated fr the past fur years and remains imprtant in this year s cnsultatin n mainstream primary and secndary frmula funding arrangements. The Minimum Funding Guarantee (MFG) will cntinue, at minus 1.5%, t prtect schls and academies against very sharp reductins in delegated budget shares in 2017/ Hwever, we are entering a challenging perid. The mst prminent immediate challenge in the management f Dedicated Schls Grant arrangements in the Bradfrd District is resurcing the required significant increase in the quantity f prvisin fr children and yung peple with high needs. The cnsequences f this challenge will be felt in the 2017/18 financial year. The financial mdelling attached shws the impact f an indicative 1.5% reductin in the values f pupil-led frmulae variables. A key purpse f this dcument then is t give early sight / warning f the implicatins f a reductin f this nature in the primary and secndary schl frmulae in 2017/ The directin f travel, and final impact, f natinal frmula arrangements fr primary and secndary schls and academies are uncertain. The intrductin f a Natinal Funding Frmula (NFF) is expected t result in a larger (abve MFG scale) redistributin f funding at bth lcal authrity and individual schl and academy level, ver time. 1.4 T recap where we are in the transitin t the Natinal Funding Frmula: In March 2012, the Gvernment annunced significant changes t the educatin funding system. These changes were implemented by all lcal authrities at 1 April 2013 and included simplified frmula arrangements fr the calculatin f delegated budgets and significant new restrictins n the central management f funds within the Dedicated Schls Grant (DSG). On 4 June 2013, the Gvernment published a dcument entitled Revenue Funding Arrangements: Operatinal Infrmatin fr lcal authrities, which set ut further changes t funding arrangements fr the 2014/15 financial year, which were designed t cntinue prgress twards a natinal frmula. On 17 July 2014, the Gvernment cnfirmed that authrities and Schls Frums wuld cntinue t be required t set lcal frmula funding arrangements fr the 2015/16 financial year. The Operatinal Guide cnfirmed that the arrangements in place fr 2014/15 wuld cntinue fr 2015/16, but with a small number f changes, which included the requirement fr the Authrity t calculate funding fr all academies (including frmer nn-recupment academies) and free schls thrugh ur lcal frmulae, including funding fr in year grwth. The Gvernment als cnfirmed that 390 millin wuld be allcated t the least fairly funded authrities in England t ensure that every lcal authrity attracts a minimum funding level fr the pupils and schls in its area; as ur funding was already abve the minimum funding levels, this did nt affect Bradfrd s DSG. The Schl revenue funding 2016 t 2017: Operatinal guide cnfirmed that the regulatins in place fr 2015/16 wuld be unchanged fr 2016/17. We therefre, made n changes t ur primary and secndary frmula funding structures fr this current financial year. On 7 March 2016, the Gvernment published the first stage f a tw part cnsultatin n the principles and prpsals fr the building blcks f the Natinal Funding Frmula (NFF). This initially prpsed fr the schl-level NFF fr Primary and Secndary schls and academies t be implemented frm April 2019, but fr transitin t this, as well as changes t mve t a frmularised High Needs Blck, t begin frm April The full cnsultatin and accmpanying dcuments can be viewed n the DfE s Schls natinal funding frmula webpage. On 21 July 2016, the Educatin Secretary made a statement, which cnfirmed that the Gvernment is still cmmitted t the intrductin f the Natinal Funding Frmula (NFF), but that the start f the implementatin f this wuld be pstpned. The Gvernment s respnse t the first stage f cnsultatin is expected t be published shrtly alng with a secnd stage cnsultatin. We still expect that this

2 secnd stage will prvide mre detailed infrmatin t enable mdelling f the impact f the NFF n individual schls and academies, as well as n the Lcal Authrity. We nw expect the transitin t a NFF t begin fr mainstream primary and secndary funding, and high needs, frm April 2018 The Schls revenue funding 2017 t 2018: peratinal guide was als published n 21 July 2016, and cnfirmed that the schl funding arrangements fr 2017/18 are bradly similar t thse f 2016/17, with n required changes t frmula structures. The guide des hwever, cnfirm sme natinal directed changes t the data t be used t calculate funding allcatins under the secndary lw attainment and the deprivatin IDACI factrs. 1.5 As a cnsequence, fr 2017/18, as this dcument sets ut: We d nt prpse t make changes t the structures (the factrs we use and hw these are used t calculate funding) f ur existing primary and secndary frmula, ther than thse necessary t cmply with the specific data changes directed by the DfE. We d nt prpse t make changes t the criteria fr the allcatin f Schls Blck DSG funds r grwth fund, ther than changes aimed at clarifying the allcatin f in year grwth funding t the secndary sectr. 1.6 As we d nt prpse t make many changes t already agreed structures, this dcument may be viewed mre fr infrmatin purpses and as a reminder f what ur current structures are. 1.7 We d hwever, wish t cllect feedback frm maintained schls n the cntinuatin f de-delegatin (please see paragraph 4). 1.8 We d als wish t give early sight / warning f the implicatins f a further cntributin frm the primary and secndary schl frmulae t resurce an increased number f places fr children and yung peple with high needs. Schls will be aware that a reductin f 0.42% was applied t all pupil-led factrs in the primary and secndary frmulae in this current financial year. Indicative DSG mdelling currently suggests that a reductin at a % value greater than this will be needed in rder t balance the DSG in 2017/18. The financial mdelling attached with this dcument shws the impact f an indicative 1.5% reductin in the values f all pupil-led frmulae variables. There is still much in this psitin t cnfirm and t cnsider. The psitin f the DSG, and the value f such a reductin in the primary and secndary frmulae, will be discussed by the Schls Frum acrss the autumn term. A final recmmendatin will be made n 11 January Schl and academy clleagues are advised t keep track f discussins by mnitring Schls Frum papers and minutes available n the Bradfrd Cuncil Minutes website. If yu are interested t understand mre abut these discussins, r wuld like t input int these, please cntact Andrew Redding andrew.redding@bradfrd.gv.uk r Sarah Nrth sarah.nrth@bradfrd.gv.uk, r alternatively, liaise with yur Schls Frum representative. 1.9 The mdelling shwn in Appendix 1 is illustrative and des nt represent a final view f 2017/18 allcatins fr each schl r academy. Please see paragraph 7 fr further explanatin f what this mdelling shws. 2017/18 delegated budget shares will be calculated using Octber 2016 Census pupil numbers n rll and pupil data, and with reference t verall affrdability within the 2017/18 DSG taking int accunt all cst pressures. The actual funding psitin fr schls and academies may als be affected by further discussins within the Schls Frum n the transitin t the NFF (nce further detail is available), the relatinship between primary and secndary levels f funding, the psitin against ther authrities and against natinal averages, and the values f ver r under spends f specific funds in 2016/ This dcument has been written by the Lcal Authrity in cnjunctin with the Schls Frum, mdelling the Octber 2015 Census dataset updated fr ur estimate f Octber 2016 numbers n rll fr individual schls and academies. Schls and academies are reminded that it is vitally imprtant that their Octber 2016 Census submissins are timely and accurate. The Authrity will nt be able t intervene t adjust census data nce this has been submitted and cnfirmed with the DfE. Inaccuracies may lead t an incrrect funding psitin This cnsultatin dcument fcuses slely n the Schls Blck funding f primary (Receptin Year 6) and secndary (Year 7 Year 11) maintained schls, academies and free schls acrss the Bradfrd District. Tw further cnsultatins, cncerning the funding f Early Years prvisin in 2017/18 Page 2 f 14

3 and the funding f High Needs in 2017/18, will be published tward the end f Octber These cnsultatin papers will be available frm the Bradfrd Schls Frum Cnsultatin Papers webpage n Bradfrd Schls Online (BSO) The deadline fr respnses t this cnsultatin is Friday 14 Octber An analysis f respnses received by the deadline will then be discussed at the Schls Frum meeting n 19 Octber Please address all questins and respnses t either Sarah Nrth sarah.nrth@bradfrd.gv.uk r Andrew Redding andrew.redding@bradfrd.gv.uk. A respnse frm is included at Appendix Schls Blck - Frmulae Factrs and ther key elements that remain unchanged in 2017/ The key elements f the Schls Blck framewrk that remain the same in 2017/18 are as fllws: Delegated budgets will be calculated n the Octber (2016) Census. The simplified primary and secndary funding frmulae arrangements cntinue, based n 13 allwable factrs, plus exceptinal premises factrs individually apprved by the DfE. As was the case fr 2016/17, tw f these factrs (the basic amunt per pupil and a deprivatin factr) are mandatry. The remaining factrs are ptinal. Lcal authrities cntinue nly t have limited chices in hw these factrs perate. Lcal authrities must allcate at least 80% f the delegated schls blck funding thrugh the pupil-led factrs, which include the base amunt per pupil, deprivatin, prir attainment, English as an additinal language, pupil mbility and lked after children factrs. We allcated 89.02% f the delegated schls blck funding via the pupil-led factrs in 2016/17, and the mdelling included in this cnsultatin indicates that we are currently allcating 88.99% in 2017/18. The Minimum Funding Guarantee (MFG) cntinues t be the nly prtectin mechanism available fr individual schl and academy allcatins and is set at MINUS 1.5% in 2017/18. The applicatin f a ceiling (r cap) in 2017/18 t pay fr the cst f the MFG prtectin fr lsing schls and academies will cntinue; this will cap the gains f the winning schls and academies s that they d nt gain mre than a specified % f funding per pupil. If the cst f the MFG reduces year n year, we wuld expect the value f the cap t als reduce. There cntinues t be n prescribed cnstraint n the primary t secndary funding rati (the distributin f frmula funding between phases). The strict restrictins n centrally managed funds cntinue and n new central cmmitments are permitted withut Secretary f State apprval. This cntinues t ensure maximum delegatin f the DSG t schls and academies at the start f the financial year. A small number f named de-delegated funds are permitted fr maintained schls. The decisins n the hlding f de-delegated funds will cntinue t be made by the Schls Frum n a phase by phase basis. Once these decisins are taken, they apply t all schls within each phase. Please see sectin 4 fr mre infrmatin. De-delegatin is nt an ptin fr academies and free schls, but where dedelegatin has been agreed fr maintained primary and secndary schls, the lcal authrity may ffer the service n a buy-back basis t academies and free schls. A small number f named centrally managed funds are als still permitted. Please see sectin 5. Funding fr expanding schls and academies and bulge classes, as well as safeguarded salaries remaining frm previus re-rganisatins, will cntinue t be funded as cntingency items. The 2016/17 framewrk fr the funding f High Needs pupils cntinues. A High Needs pupil is still defined, fr financial purpses, as ne whse educatin csts mre than 10,000 per year. The first elements f funding fr High Needs pupils cntinue t be already delegated within budget shares. A tp up is then allcated separately, n a mnthly basis, fr the cst f additinal supprt abve the 6,000 threshld. A ntinal SEN budget will still be defined within budget shares. Schls and academies with resurced prvisins will cntinue t have their number f funded places remved frm their number f pupils funded under the primary r secndary frmula; fr 2017/18 the number f academic year funded places will be deducted frm the schl s number n rll in Octber The Authrity can still emply the SEN Funding Flr, which supprts the csts in schls and academies with higher levels f SEN but where the nrmal funding frmulae des nt allcate sufficient resurces. Page 3 f 14

4 The Pupil Premium will cntinue t be allcated as a separate grant in 2017/18, and is set t cntinue until the end f this current Parliament (2020); it will cntinue t be allcated in 2017/18 as a separate grant t schls and academies. We anticipate that this grant will cntinue t be based n Ever 6 FSM numbers, Ever 6 Service Children, Lked After Children and Children Adpted frm Care. Unlike frmula funding, the Pupil Premium Grant is allcated n January Census pupil numbers. The Pupil Premium is currently set at 1,320 fr primary-aged and 935 fr secndary-aged pupils eligible under the ever-6 FSM criteria. Children wh are lked after r adpted frm care currently are allcated 1,900, and service children are allcated 300. The Pupil Premium rates fr 2017/18 have nt yet been cnfirmed. Allcatins fr academies and free schls will cntinue t be paid directly by the Educatin Funding Agency (EFA). The EFA will use the pr-frma submitted by the Authrity t calculate individual allcatins. 3. Summary f 2017/18 Frmulae as 2016/ The table belw summarises the frmulae factrs, and the indicative values f these factrs, in 2017/18 as these currently stand, based n ur prpsal fr n change ther than fr the directed revisins t the use f data in Deprivatin IDACI and the secndary phase lw prir attainment factrs. The pr-frma shwn in Appendix 2 prvides further explanatin f the basis f the calculatins. Please nte that the values f factrs include the indicative 1.5% reductin in all pupil-led factrs. Frmula Factr Indicative Primary Unit Value (2017/18) Indicative Secndary Unit Value (2017/18) Base Amunt per Pupil Primary 2, N/A Base Amunt per Pupil - Key Stage 3 N/A 4, Base Amunt per Pupil - Key Stage 4 N/A 4, Deprivatin - Ever 6 FSM 1, Deprivatin IDACI - Band F * Deprivatin IDACI - Band E * Deprivatin IDACI - Band D * Deprivatin IDACI - Band C * Deprivatin IDACI - Band B * Deprivatin IDACI - Band A * , SEN Lw Prir Attainment English as an Additinal Language , Pupil Mbility 1, , Lump Sum per schl / academy 175, , Split Sites Funded n LA frmula (see paragraph 3.5) Funded n LA frmula (see paragraph 3.5) Rates Funded at actual cst Funded at actual cst Private Finance Initiative (PFI) cntracts Funded n LA frmula (see paragraph 3.6) Funded n LA frmula (see paragraph 3.6) * Please see paragraph 3.3 belw fr infrmatin n the changes t IDACI banding fr the Octber 2016 dataset. 3.2 The DfE is t intrduce a new natinal weighting fr secndary lw prir attainment figures in 2017/18, and the Deprivatin IDACI bandings have als been changed. Please be aware that the updated IDACI bandings are incrprated int the mdelling, but we cannt yet take accunt f the impact f the natinal weighting fr secndary lw attainment, as this will nt be made available by the DfE until December The DfE s intentin is t use a natinal weighting t ensure that, respnding t assessment change, the chrt f pupils assessed under the 2016 KS2 assessments des nt have a disprprtinate influence within the verall ttal. 3.3 We will cntinue t use the factrs, where we have sme chice abut hw these are used, in the same way as in 2016/17, as fllws: Base Amunt per Pupil Primary: including the Receptin Uplift factr t supprt schls and academies taking in Receptin pupils between the Octber and January Censuses; this als supprts schls with higher levels f mbility. Page 4 f 14

5 Deprivatin - Ever 6 FSM: the % f pupils n rll where the FSM indicatr is TRUE in any f the censuses in the last 6 years Deprivatin IDACI Bands A - G: the % f pupils with an IDACI scre in each band A G. IDACI is calculated based n the pstcdes f pupils recrded in the Octber Census. The bands are set natinally and are shwn in the table belw. Althugh the bands have changed fr the Octber 2016 dataset (please see Annex A fr further detail n the IDACI banding change), the prpsed weightings attributed t each band are unchanged frm 2016/17 and are as fllws: IDACI Band IDACI Scre - Lwest IDACI Scre - Highest Prpsed Weighting Band F Band E Band D Band C Band B Band A SEN Lw Prir Attainment Primary: the % f pupils in years 5 and 6 that received less than 73 pints n their Early Years Fundatin Stage Prfile (EYFSP) plus the % f pupils in years 1, 2, 3 and 4 wh did nt achieve a gd level f develpment under the new EYFSP. A weighting is applied t ensure that funding delivered thrugh this factr is nt disprprtinately affected by the year grups assessed under the new framewrk. English as an Additinal Language (EAL) 3: the % f pupils whse first language is nt English and wh are appearing n the schl census fr the first, secnd r third year. 3.4 We will cntinue nt t emply the fllwing ptinal factrs in 2017/18: Sparsity Factr - the sparsity factr is nt applicable t any schl / academy in the Bradfrd District Lked After Children - it cntinues t be ur view that the Pupil Premium shuld be the surce f funding fr Lked After Children, as has been the case since 2013/14. The Pupil Premium is currently set at 1,900 fr children wh are lked after in 2016/17, which is abve ur previus value f 1,000. The Pupil Premium rates fr 2017/18 have nt yet been cnfirmed There is n change t the peratin f the split sites factr in 2017/18. a) The criteria used t define a split site are unchanged fr 2017/18 and are as fllws: Essential - tw r mre distinctly separate campuses where there is n single cntinuus bundary and where the campuses are split by a thrugh rad. Additinal criteria (fr weighting f funding): Categry A - where it is impssible nt t mve a prprtin (either 25% r 50%) f ttal schl / academy pupils between the campuses within the schl day Categry B - where the campuses are mre than 400 metres apart b) The criteria used t allcate funding t a schl / academy perating acrss a split site based n the categries defined abve, are as fllws: Categry Primary Lump Primary APP Secndary Lump Secndary APP Essential 8, , A B 18, , Additinal Ntes: Split sites funding is paid t all schls and academies that meet the abve criteria. Federated schls are nt eligible fr split sites funding. Where 2 schls have amalgamated and the new schl is perating acrss a split site, the schl will nt be eligible fr split sites funding whilst it is in receipt f the additinal lump sum (in the year immediately after amalgamatin). Page 5 f 14

6 Funding is nly applicable fr Receptin t Year 11 mainstream prvisin. We wuld nt expect split sites funding t apply t c-lcated r ffsite behaviur centres. 3.6 The factr in ur secndary funding frmula fr Private Finance Initiative (PFI) cntracts allcates the DSG s cntributin t the affrdability gap f the Building Schls fr the Future (BSF) prgramme fr applicable schls / academies. The frmula fr splitting the ttal cntributin between BSF schls / academies is as fllws: (Ttal affrdability gap t be funded by the DSG / Ttal cst f schl unitary charges) x Individual schl s unitary charge as a % f the ttal unitary charge Questin 1 D yu agree with cntinuing t use the 2016/17 existing frmula structure t calculate delegated budgets fr schls and academies fr the 2017/18 financial year? If nt, please explain the reasns why nt. The values f each frmula factr will nt be cnfirmed until January 2017 and will depend n the utcmes f the discussins that take place at the Schls Frum during the autumn term. Questin 2 - D yu have any cmments n the way the factrs are used, as described in the prfrma and paragraph 3.3? Questin 3 - D yu have any additinal cmments n the prpsed apprach fr 2017/18 that yu wish the Schls Frum t take int cnsideratin? 4. Maintained Schls - De-Delegated Funds in 2017/ The Finance Regulatins cntinue t significantly restrict the extent t which the Dedicated Schls Grant (DSG) can be held and managed centrally. The Gvernment s intentin, in preparatin fr the Natinal Funding Frmula, is t ensure maximum delegatin f the DSG t schls and academies at the start f each financial year. The Regulatins d allw funding fr certain types f expenditure t be de-delegated, r passed back, frm maintained schl budgets t be managed centrally. This nly applies t maintained schls (nt academies r free schls) and the Schls Frum must agree t de-delegate n a phase specific basis, s Frum members representing primary and secndary maintained schls must decide separately fr each phase whether the service shuld be funded centrally by tpslice. 4.2 Previusly, the Schls Frum has established de-delegated funds s as t: take advantage f the ecnmies f scale brught abut by central management and bulk purchase e.g. Fischer Family Trust subscriptins prvide services that schls wuld find difficult r less cst effective t replace n an individual basis e.g. trade unin facilities time prtect schls, especially smaller schls, against unpredictable expenditure e.g. maternity and paternity csts 4.3 Decisins made t de-delegate this year relate t this year nly and new decisins are required fr dedelegatin in 2017/18. The NFF prpsals currently indicate that we will n lnger be able t de-delegate frm April The Schls Frum will therefre, be cnsidering the psitin f de-delegated funds ver the autumn term, in the cntext f the NFF prpsals, but als taking int accunt the rate f the cnversin f maintained schls t academy status befre r during 2017/ This cnsultatin asks fr views nly n whether funds shuld cntinue t be de-delegated fr the purpses listed belw. Please be aware that the values f these funds, where de-delegatin cntinues, will be cnsidered further by the Schls Frum in the autumn term. We wuld expect the values f funds t match anticipated cst pressures and t reduce frm 2016/17 fr the impact f maintained schls cnverting t academy status. 4.5 The fllwing de-delegated funds are held in this financial year: ESBD Cre Schl Supprt Team FSM Eligibility Assessments Fischer Family Trust Schl Licences Page 6 f 14

7 Schl Maternity / Paternity insurance Trade Unin Facilities Time Trade Unin Health and Safety Representative Time Schl Staff Public Duties and Suspensins Fund Further infrmatin n these funds, including values, is given in Appendix Fllwing the Lcal Authrity s review f supprt services during 2015, and the re-alignment f supprt services with the sectr-led imprvement mdel during 2016, the de-delegated fund in supprt f the Minrity Ethnic Supprt Team ceased at 1 May 2016 (nly a 1 mnth value was held in 2016/17). 4.7 If funding is nt de-delegated fr the purpses listed abve, then the funding will remain within schl budgets fr schls t prvide fr the cst f services frm their wn resurces, including purchasing services available thrugh the Lcal Authrity. The Authrity is aware that the views f individual schls may be influenced by the extent f value they feel they receive frm accessing these funds currently. In making final recmmendatins, the Schls Frum will cnsider specific respnses t this cnsultatin alng with the verall mst effective apprach fr maintained schls acrss the District. Please cntact yur Schls Frum representatives if yu have any specific cmments n these funds. Questin 4 Shuld sums cntinue r cease t be de-delegated frm maintained schl budgets in 2017/18 fr the purpses listed abve? Please explain the reasns why. 5. DSG Schls Blck Centrally Managed Funds 5.1 The Finance Regulatins cntinue t significantly restrict the types f funds that can be held centrally within the DSG. Where funds are held, the Regulatins require that the criteria fr accessing these are clear and have been agreed with the Schls Frum. 5.2 In 2016/17, the Schls Frum agreed t hld the fllwing permitted funds: A Grwth Fund, t supprt schls and academies expanding fr basic-need purpses at the request f the Lcal Authrity A Csts f Re-Organisatin Fund, which allcates funding t match the cst f safeguarded salaries remaining in maintained schls, where it has been previusly agreed that the Lcal Authrity will supprt the cst. This Fund als will meet the cst f deficits f clsing schls r maintained schls cnverting t academy status under a spnsred arrangement. An Exceptinal Csts / Schls in Financial Difficult Fund fr maintained schls. 5.3 These funds supprt the achievement f the Bradfrd District s educatinal pririties as fllws: Enable additinal financial supprt t be prvided, in a transparent and cntrlled way, t specific schls that may face difficult circumstances and unreasnable cst pressures. Supprt schls that require immediate interventin arund standards that may nt be able t identify funds frm their wn budgets. Supprt schls, academies and the Lcal Authrity t manage mre effectively the financial pressures brught by places expansin. Cllectively, help t maintain a stable financial platfrm fr schls and academies acrss the District, in supprt f raising standards. 5.4 The prpsed arrangements fr 2017/18 are shwn belw and are unchanged frm this financial year, ther than changes aimed at clarifying the allcatin f in year grwth funding t the secndary sectr. Page 7 f 14

8 Details f these funds in 2016/17 and prpsals fr 2017/ The Ring-Fenced Grwth Fund The ttal value f the Grwth Fund in 2016/17 was 1.73m, brken dwn between phases and types, as fllws: Primary Secndary Ttal Existing Knwn Expansins 746, ,542 Existing Bulge Classes 349, ,281 New Expansins 250, , ,000 Pre-Opening Csts Disecnmies f Scale 85, Ttal Value 2016/17 1,430, ,000 1,730,823 The criteria prpsed fr allcating in 2017/18 grwth funding t newly establishing schls and academies are the same as in 2016/17: Newly established Schl / Academy Prvisin additinal supprt: Fr basic need purpses, where a new schl / academy is established by the Lcal Authrity, r where an existing schl / academy extends its prvisin int a new phase i.e. a Secndary schl / academy establishes Primary-aged prvisin and vice versa, at the request f the Lcal Authrity, and where the new schl / academy des nt yet have pupils in all planned year grups, the funding apprach will be: Pre-Opening supprt (this is nt applicable t nn basic need Free Schls): the Schls Frum will cnsider the allcatin f a pre-pening budget based n previus methdlgies but als taking accunt f the specific circumstances f the schl / academy. Pst-Opening supprt fr disecnmies f scale (this is nt applicable t nn basic need Free Schls): the Schls Frum will cnsider the allcatin f a budget based n previus methdlgies but als taking accunt the specific circumstances f the schl / academy. Newly established Schl / Academy Prvisin revenue frmula funding: (this des apply t nn basic need Free Schls but nly frm the 2 nd year f establishment): in the first financial year the schl / academy will receive a full calculatin f frmula funding fr the number f children planned t be admitted in September, based n estimated data, fr the prprtin f the year that the schl / academy is established (e.g. 7/12ths fr a September pening). Fr technical purpses, this will nt be an allcatin frm the Grwth Fund, but a frmula funding allcatin via the agreed frmula the Lcal Authrity will submit an applicatin t the EFA t vary pupil numbers n the basis f planned numbers. Any significant difference between estimated and actual intake numbers will be adjusted fr retrspectively in the fllwing financial year. In subsequent years, until all year grups are established, the schl / academy will be funded n the basis utlined abve, prviding a full calculatin f additinal frmula funding fr the planned additinal intake fr the fllwing September, with a retrspective adjustment where there are significant differences between estimated and actual intake numbers. Please nte that academy / free schl will receive their allcatins directly frm the EFA, althugh these are still funded frm the DSG. The criteria prpsed fr allcating grwth funding in 2017/18 t already established primary schls and primary academies, that have been asked t increase their admissin numbers, are the same as in 2016/17: PRIMARY schls / academies permanently expanding by increasing the size f existing year grups: Primary schls and academies are nrmally asked by the Lcal Authrity t expand by 0.5 FE r 1 FE at any ne time. Grwth funding is allcated s that the schl r academy has the additinal funds t establish a new class (r classes). Funding is allcated as fllws: Fr basic need purpses, where an established primary schl r academy is permanently expanding by increasing the size f existing year grups, and has already begun t expand befre the start f the financial year, the additinal allcatin will be included within the schl s / academy s initial budget. Funding is calculated n the difference between the Octber 2016 census pupil numbers and a calculatin f the cmpsite 5/12 + 7/12 numbers, Page 8 f 14

9 based n an estimate f the schl s Octber 2017 Census. The schl will then be allcated 80% f the value f the base amunt per pupil fr the difference between the actual and the cmpsite calculatin. On indicative 2017/18 values this wuld give 2,272 per pupil. Fr basic need purpses, where a primary schl r primary academy is permanently expanding by increasing the size f existing year grups fr the first time in September 2017, the schl / academy is allcated 80% f the value f the base amunt per pupil fr the additinal planned intake number, fr the applicable prprtin f the year (fr September expansins this is 7/12ths). On indicative 2017/18 values this wuld give 2,272 per pupil. Funding will be physically allcated in September PRIMARY schls / academies taking a Bulge Class added t existing year grups: Full classes: Fr basic need purpses, where a primary schl r academy is asked in year t admit a full class r Frm f Entry (30) int / n tp f an existing year grup, funding is allcated n the same basis as fr new permanently expanding schls abve; at 80% f the base amunt per pupil value fr the planned additinal admissin number fr the relevant prprtin f the financial year. In the fllwing financial year, n additinal funding is necessary r allcated; this additinal class is autmatically funded within the schl s / academy s nrmal revenue budget. Half classes: Fr basic need purpses, where a schl / academy is asked in year t admit an additinal number f children that d nt add up t a full class r Frm f Entry int / n tp f an existing year grup, the additinal sum fr the current financial year is allcated as fr a full class abve, based n the actual planned additinal intake number. In the fllwing year, and in each year fr the lifetime the half class is at the schl / academy, an additinal sum is allcated based n 80% f the value f the base per pupil amunt fr the difference between 30 and the actual number f children in the half class. S if the class had 15 pupils the funding wuld be (30 15) x base app x 80%. The value f this funding is reviewed each year, fr actual numbers. The year n year grwth in pupil numbers is nw reaching the secndary phase. The Authrity prpses t apply the same general basis f funding t the secndary phase as has been used fr the primary phase. Hwever, because the numbers invlved in expansins may be mre fluid in the secndary phase (may nt be clear denminatins f 30), because secndary schls have larger budgets and curriculum structures, meaning that small increases in numbers may nt result in greater cst t the schl, and als because the intakes f secndary schls and academies can be / are being adjusted fr reasns ther than a request by the Lcal Authrity fr basic need sufficiency, it has been identified that the criteria fr the allcatin f grwth funding in the secndary phase will benefit frm additinal clarity. SECONDARY schls / academies either permanently r temprarily increasing PAN: We prpse that eligibility fr grwth t secndary schls and academies is assessed n the fllwing principles and criteria: The schl r academy must have admitted additinal pupils (either via a permanent expansin r a ne ff bulge class) at the request f the Lcal Authrity t meet basic-need sufficiency and nly numbers assciated with basic need sufficiency will be eligible fr funding. The request fr additinal places frm the Authrity has cme within the nrmal admissins rund and relates t the schl s year 7 intake i.e. pupils admitted at ther times in year, admissins t year grups ther than year 7, r pupils admitted n appeal r under the Fair Access Prtcl, are nt funded by the Grwth Fund. Cnsideratin f additinal funding in these circumstances wuld be picked up by the exceptinal pressures / schls in financial difficulty fund fr maintained schls nly. Funding in the first year is calculated n actual numbers and allcated nly nce actual Octber Census numbers are cnfirmed (s fr additinal pupils in September 2017, funding will be calculated and allcated n the basis f the additinal csts assciated with the actual number f additinal pupils recrded in the Octber 2017 Census). Page 9 f 14

10 Funding is allcated nly after an assessment f the actual cst implicatins f the additinal pupils n the schl s budget in that year e.g. in admitting additinal pupils the schl evidences that it must incur additinal csts in year and that these csts are cmmensurate with the value f additinal funding that wuld be allcated. This wuld be smething that wuld be reviewed n an annual basis. Funding fr eligible schls and academies wuld be calculated as fllws: Where a secndary schl r academy is permanently expanding by increasing the size f its year 7 fr the first time in September 2017, the schl / academy is allcated 80% f the value f the Key Stage 3 base amunt per pupil fr the additinal planned intake number, fr the applicable prprtin f the year (fr September expansins this is 7/12ths). On indicative 2017/18 values this wuld give 3,265 per pupil. Funding will be physically allcated in September Where an established secndary schl r academy is permanently expanding by increasing the size f existing year grups, and has already begun t expand befre the start f the financial year, the additinal allcatin will be included within the schl s / academy s initial budget. Funding is calculated n the difference between the Octber 2016 census pupil numbers and a calculatin f the cmpsite 5/12 + 7/12 numbers, based n an estimate f the schl s Octber 2017 Census. The schl will then be allcated 80% f the value f the Key Stage 3 base amunt per pupil fr the difference between the actual and the cmpsite calculatin. On indicative 2017/18 values this wuld give 3,265 per pupil. At the pint the schl s expansin reaches Key Stage 4, 80% f the Key Stage 4 base app will be used (which indicatively is 3,357). Where a secndary schl r academy has been asked t take a year 7 bulge class (ne ff temprary PAN increase) f any size, funding is allcated n the same basis as fr new permanently expanding schls abve; at 80% f the Key Stage 2 base amunt per pupil value fr the planned additinal admissin number fr the relevant prprtin f the financial year. This is a ne ff allcatin. In the fllwing financial year, n additinal funding is allcated; this additinal class is autmatically funded within the schl s / academy s nrmal revenue budget. Questin 5 - D yu agree with the prpsed criteria and methdlgy fr the allcatin f the grwth funding t schls and academies in 2017/18? If nt, please explain the reasns why nt. 5.6 Schl Re-Organisatin Csts - maintained primary and secndary schls The value f this fund in 2016/17 was 0.08m, brken dwn between phases and types f re-rganisatin csts, as fllws: Primary Secndary Ttal Schl Staff Safeguarded Salaries 77,800 4,064 81,863 Deficits f Clsing Schls Ttal Value 2016/17 77,800 4,064 81,863 The prpsed criteria fr allcating funding frm this cntingency fund in 2017/18 are unchanged frm 2016/17: Schl staff safeguarded salaries: funding is allcated, based n the actual cst f agreed safeguards fr individual staff in schls. Only safeguards that have been previusly agreed are funded frm the DSG. S there is n eligibility criteria as such, ther than these safeguards must have been already established and agreed with the Authrity fllwing re-rganisatins. Every year, schls are asked t cnfirm whether r nt safeguards fr individual staff are still applicable e.g. where a member f staff has left, the safeguard ceases t be paid. The ttal cst f safeguards reduces year n year. Deficit f Clsing Schls: where a maintained schl clses with a deficit budget, r where a maintained schl with a deficit budget cnverts t academy status under a spnsred agreement, the deficit returns Page 10 f 14

11 t the DSG. The Frum has established the principle that prvisin fr such csts are best met frm ne ff available funds and / r retrspectively frm the DSG in the fllwing year. 5.7 Exceptinal Csts & Schls in Financial Difficulty - maintained primary and secndary schls The purpse f this fund is t prvide supprt fr the budgets f maintained schls in the fllwing circumstances: Exceptinal grwth in pupil numbers, nt picked up within the terms f the Grwth Fund 1 Frm f Entry (r smaller) primary schls, where the cst f external HR investigatins places the schl in financial difficulty i.e. wuld reduce the frecasted carry frward balance belw 20,000 * Pririty 1 schls, where additinal interventin / supprt is required as recmmended by SIG / SSMG and where the schl s budget cannt meet the csts withut placing the schl in financial difficulty i.e. wuld reduce the frecasted carry frward balance belw 20,000 * Lcal Authrity Statutry interventins in schls e.g. csts f an IEB Any ther circumstance, where the exceptinal nature f this is agreed by the Schls Frum and where t nt prvide financial supprt wuld place the schl in a financially difficult psitin that it is likely t have a detrimental impact n utcmes fr children * * 20,000 is a reasnable safety net t apply fr all schls i.e. a schl with 20,000 hlds adequate reserve t meet additinal unexpected csts The value f this fund in 2016/17 was 0.175m, brken dwn between phases, as fllws: Primary Secndary Ttal Ttal Value 2016/17 150,000 25, ,000 The prpsed criteria fr allcating funding fr exceptinal pupil numbers grwth (the mst cmmn call n this fund) in 2017/18 are unchanged frm 2016/17 and are as fllws: The main factr taken int accunt is the extent f additinal cst pressure faced by a schl. This is assessed n the infrmatin prvided by the schl n what actin has been needed t meet the grwth in pupil numbers The extent f increase in numbers: actual numbers and % f rll (vs. the phase average) Whether the Lcal Authrity has directed the additinal pupils t the schl Hw the additinal pupils are distributed acrss the schl Whether this is a ne ff issue i.e. the ptential extent fr exceptinal grwth and further cst pressure in future years? In judging exceptinal funding fr children admitted n appeal, what the specific circumstances are at the schl which require the schl t make additinal prvisin in the first year The schl s carry frward balances psitin The change in the schl s expenditure shwn in the Start Budget vs. Q1 vs. Q2 vs. Q3 mnitring reprts The Pririty categry f the Schl (is the schl in Pririty 4?) Whether the schl has received financial supprt r funding frm elsewhere Questin 6 - D yu agree with the centrally managed funds, and their criteria, that are prpsed t be held in the DSG in 2017/18? If nt, please explain the reasns why nt. 6. The MFG and the Ceiling 6.1 The Minimum Funding Guarantee (MFG) will cntinue in 2017/18 at MINUS 1.5% i.e. the maximum reductin in funding fr a schl / academy will be limited t 1.5% f that schl s 2016/17 funding per pupil. 6.2 The main reasns fr schls r academies being n the MFG in 2017/18 are: The impact f the 1.5% reductin applied t all pupil-led frmula variables fr the purpses f funding increasing the quantity f prvisin fr children and yung peple with high needs. Page 11 f 14

12 The MFG is cntinuing t prtect the schl / academy against the impact f changes made in frmula funding since April 2013 i.e. the schl / academy was lsing mre than 1.5% per pupil due t the funding refrms in 2013/14 r the additinal changes made in 2014/15, and this prtectin still has t fully wrk thrugh. The MFG is cntinuing t prtect a schl / academy against the impact f frmula change prir t April 2013, fr instance fllwing the mainstreaming f grants in 2011/12, where a schl / academy was prtected by the MFG in 2011/12, 2012/13, 2013/14, 2014/15 and 2015/16 n a sliding scale which has still t fully wrk thrugh. The schl s/ academy s data recrded in the Octber 2016 Census e.g. FSM%, is significantly different (lwer) frm that recrded in previus censuses. This will result in a reduced ttal amunt per pupil funding fr the schl, and the MFG prtects against the drp. 6.3 As we have established in ur previus funding reviews, the MFG must be affrded by the applicatin f a ceiling. This ceiling caps the winners under the funding frmulae at a % per pupil, which releases the value needed t supprt the cst f the MFG. This is the nly way that change can be affrded. The effect f the MFG, cmbined with the ceiling, is t pull the distributin f funding between schls and academies back twards hw this stands nw and it means that it will take lnger fr the budgets f the schls and academies that gain t realise these increases. Please nte that the 1.5% reductin in pupil-led funding rates increases the numbers f schls n the MFG and the verall cst f the MFG, s the ceiling in the indicative mdelling is currently set at 0%. 6.4 As was the case in 2016/17, the ceiling must be calculated n the same basis as the MFG and the % cap must be the same fr primary and secndary schls / academies. We can chse whether t implement the ceiling by capping all grwth ver a certain % per pupil r by scaling back gains f winning schls / academies by a set amunt prprtin t the schl s gain. It cntinues t be ur view that the capping apprach is much fairer and als fllws the same apprach that we have used previusly. We are therefre, nt prpsing any change in the peratin f the ceiling, but the value f the % cap cannt be set until the final cst f the MFG is knwn. Please nte that the ceiling must nt be applied t new and grwing schls and academies (thse with sme empty year grups) which have pened in the last 7 years, s these schls and academies will nt cntribute t the ceiling in 2017/ Further Explanatin f the Indicative Mdelling 7.1 The mdelling in Appendix 1 shws the impact f the prpsals utlined in this cnsultatin n primary and secndary schls and academies, based n applying a 1.5% reductin t all pupil-led frmula factr variables Estimated Octber 2016 pupil numbers n rll The Octber 2015 dataset, updated fr IDACI bandings as shwn in paragraph 3.3 and Annex A. The mdelling is intended t give an early estimate and early warning f individual schl and academy allcatins fr 2017/ Please nte that Appendix 1 fcusses n the Schls Blck and des nt, at this stage, give a cmplete picture f individual delegated budgets. The mdelling des nt include Early Years Funding, Pst 16 funding r funding frm the High Needs Blck. These will be cvered in separate cmmunicatins and cnsultatins. 7.3 The mdelling shws the ttal variance f 2017/18 estimated funding against 2016/17 actual funding. This ttal is als separated int frmula funding, cntingencies and Pupil Premium allcatins s that the cause f variances can be better understd. The main factrs behind these variances are: A change in pupil numbers n rll (shwn in clumn (R)) A reductin in frmula funding due t the 1.5% reductin (the estimated cst t each schl / academy is shwn in clumn (T)) A reductin in (r ending f) the MFG fr thse schls that have previusly been prtected Changes in cntingency allcatins, in particular relating t the pupil numbers n rll at expanding schls / academies Page 12 f 14

13 7.4 Whether a schl / academy is prtected by the MFG, r is capped by the ceiling, is shwn in the mdelling. Schls and academies n the MFG shuld plan fr this prtectin t reduce ver time. Schls and academies n the ceiling may expect t receive the sum by which their budgets have been reduced eventually in future years. Hwever, any future prjectins will be significantly influenced by the intrductin f the NFF, which will verride any previus arrangements. 7.5 If yu wuld like t discuss the mdelling in mre detail, r discuss the data n which allcatins are calculated, please cntact Sarah Nrth. Questin 7 - D yu have any cmments n the mdelling? 8. Cnsultatin Respnses 8.1 Please use the respnses frm in Appendix 3 t submit yur views n the prpsals utlined in the cnsultatin. There is space n this frm fr yu t cmment n any aspect f the prpsals. If yu wish t discuss these prpsals in mre detail, r have any specific questins, please cntact either Sarah Nrth, r Andrew Redding, using the cntact details shwn in paragraph Please ensure that yur respnse is submitted by the deadline f Friday 14 Octber Any respnses received after this deadline date may nt be included in the verall analysis presented t the Schls Frum. 9. Next Steps 9.1 Fllwing cnsideratin f the respnses t this cnsultatin and the recmmendatin f the Schls Frum, the structures f the primary and secndary funding frmulae t be used t calculate budgets in 2017/18, and the criteria fr the allcatin f Schls Blck DSG cntingency funds and grwth funds, will be set by the Cuncil s Executive. 9.2 Schls and academies will cmplete the Octber Census n Thursday 6 Octber The dataset frm this census will be available fr us t analyse mid-december. 9.3 Discussins n the verall DSG funding psitin fr 2017/18, the hlding f de-delegated and cntingency funds, the balance f funding between primary and secndary, the value f cntributin fr increased high needs prvisins, and the impact n schls f using the Octber 2016 Census dataset, will take place in the Schls Frum between nw and January Yu are recmmended t keep in tuch with these discussins by visiting the Schls Frum webpage n the Cuncil s Minute s site. 9.4 It is anticipated that the Schls Frum will make its final recmmendatins n 2017/18 arrangements n Wednesday 11 January Appendices 1. Appendix 1 Illustrative Frmula Mdelling 2. Appendix 2 Indicative EFA Pr-frma fr 2017/18 3. Appendix 3 Cnsultatin Respnses Frm 4. Appendix 4 Infrmatin n De-Delegated Funds Page 13 f 14

14 ANNEX A: New IDACI bands fr 2017/18 The Incme Deprivatin Affecting Children Index (IDACI) dataset is updated every five years by the Department fr Cmmunities and Lcal Gvernment. The latest update t the dataset (IDACI 2015) tk effect in the 2016/17 schls blck dataset in December 2015 and resulted in a markedly different distributin t the previus 2010 dataset. In respnse t cncerns raised by lcal authrities and views expressed thrugh the first stage NFF cnsultatin, the DfE has respnded t update the IDACI banding methdlgy t return the IDACI bands t a rughly similar size (in terms f the prprtin f pupils in each band) as in 2015/16. The revised bands are named A t G ; with the mst deprived neighburhds being captured by band A (previusly bands 6 and 5). The table belw shws the prprtin f pupils in each IDACI band in the 2015/16 schls blck dataset (clumn C) and the 2016/17 schls blck dataset (clumn D). Clumn G sets ut the 2016/17 dataset mapped nt the new IDACI bands. Bands used in 2015/16 and 2016/17 (A) IDACI scre (B) % pupils in each band (2015/16) Based n IDACI 2010, 2016/17 IDACI bands (C) % pupils in each band (2016/17) Based n IDACI 2015, 2016/17 IDACI bands (D) New bands fr 2017/18 (E) IDACI scre (F) % pupils in each new band (Oct 15 Census) Based n IDACI 2015, 2017/18 new IDACI bands 6 Between 0.60 and % 1% A Between 0.50 and % 5 Between 0.50 and % 3% B Between 0.40 and % 4 Between 0.40 and % 8% C Between 0.35 and % 3 Between 0.30 and % 14% D Between 0.30 and % 2 Between 0.25 and % 9% E Between 0.25 and % 1 Between 0.20 and % 10% F Between 0.20 and % 0 Less than % 56% G Less than % (G) Page 14 f 14