Budget shares 2017/2018 – Primary Schools
Explanatory Notes
These notes should be read in conjunction with your budget share pack for 2017/18
There have been a number of changes to school funding for 2017/18 and it is important that you read these explanatory notes to ensure you fully understand the funding information for your school.
Details of budget share changes which were consulted on as part of the annual Fair Funding Consultation[1] are included in the Fair Funding Consultation 2017/18 document.
Please note the Local Authority is required to use the data provided by the Education Funding Agency (EFA) to calculate the budget shares, therefore any data related queries should be directed to the EFA.
· The main changes that will affect primary school budgets are:
o IDACI Dataset Change (please see the ‘IDACI Dataset Change’ subsection within section 2 for details).
o Changes to levels of de-delegated budgets (please see the ‘De-delegated budgets’ subsection within section 2 for details).
· There are inflationary pressures on school costs for the 2017/18 financial year (please see section 1 for details).
· The unit funding rates for the Pupil Premium Grant have been retained at their 2016-17 levels (please see the ‘Pupil Premium Grant’ subsection within section 3 for details).
· For information, a list of other Government grants which are paid to schools by the Local Authority have been included in section 4 below.
· Capital Funding allocations for 2017/18 are not yet available (please see section 5 for further details).
· We would also like to draw your attention to the Fair Funding Scheme of Delegation[2]. The Fair Funding Scheme of Delegation sets out the financial relationship between the Local Authority and the schools it maintains.
1 Pressures on school costs
Pay and Price Inflation
● There have been some increases to staff pay and pensions;
- Officer’s Salaries[3] +1.00%
- Officer’s Pensions +3.40%
- Teacher’s Salaries[4] +1.00%
● There has been a national review of National Non Domestic Rates (NNDR) which has resulted in some significant increases across the school sector. This is funded for schools based on actual cost (see section 2).
● From April 2017 the government have introduced the apprenticeship levy. This is a tax based on 0.5% of an organisation’s pay bill. This money is put into a digital fund for the LA to resource training costs for apprenticeships. For further information please refer to letter and guidance e-mailed to schools on the 26th January.
● Despite the cost pressures outlined above, there has been no increase in the unit rate of the Dedicated Schools Grant (DSG to support these cost pressures. The increases therefore have to be managed by schools and the LA within the existing DSG allocation.
2 Changes that affect school budget shares
● As there has been no inflationary increases to the DSG; the process we have followed is to maintain the formula factor unit rates at their 2015/16 levels[5]. Any remaining surplus/shortfall, after these rates are used to calculate budget affordability, is used uplift/reduce the unit rates by a consistent level.
Data changes
● Each year the EFA updates all of the pupil data that is used to calculate school budget shares.
● In 2016/17 the EFA updated the IDACI (Income Deprivation Affecting Children Index) baseline from one that was formerly based on 2010 data to one that is based on 2015 data. This led to a nationwide overall reduction in the total needs of pupils as defined by IDACI, as a result of banding changes. This year the EFA have reviewed this to ensure better alignment of the 2015 data with the 2010 data.
● Schools can identify their number of pupils within each IDACI band by looking at the detail on their ‘Budget Share Statement’ tab within their funding pack. If schools wish to compare their 2017/18 IDACI data with that from 2016/17 they can make comparisons by looking at this data on the budget shares for both years.
● There is an overall reduction in the free school meal (FSM) data of 8%. This will fluctuate at individual school level. Only a small amount of money is allocated in the formula on FSMs, so the impact should not be significant.
Rates Funding
● The Rates factor funds a school for an estimate of its National Non Domestic Rates (NNDR) bill, along with an adjustment for any over or under funding of their previous year’s rates bill. For example;
- In 2016/17 a school received rates funding of £8,000 however, the actual NNDR bills paid during that year totalled £9,000.
- For 2017/18 the school’s estimated rates bill is £9,500 on top of which they receive an additional £1,000 (which covers the NNDR shortfall for 2015/16).
- The school’s rates funding for 2017/18 is therefore £9,500 plus £1,000 = £10,500.
o Schools that have received a rates adjustment in 17/18 that relates to an under/over funding of 16/17 rates will need to make an adjustment to their 2016/17 accounts at year end to reflect the correct distribution of their rates funding. Your School Finance Officer will assist you with this adjustment.
De-delegated Budgets
● The 2013/14 School Funding Reform required local authorities to make some further delegation to schools from budgets that were held centrally on behalf of schools. Alongside this, maintained schools were given the ability to de-delegate (pool) some of the funding for the local authority to continue to provide and manage services centrally.
● De-delegation decisions must be reviewed annually by the Schools Forum, and for 2017/18 there has been a change:
o Supplementary Fund: was for 16/17 only. It was delegated to schools from reserve funding, and then removed through de-delegation. Both the funding through the budget shares and the de-delegation have been removed in 17/18.
o Former Education Services Grant (ESG); the ESG ends from September 2017. The part of the grant that relates to a Local Authority’s responsibilities for all schools has transferred into the dedicated schools grant, and any expenditure against this agreed as part of the Schools Forum responsibilities in relation to central expenditure. The part of the grant relating to a Local Authority’s responsibilities for maintained schools has gone completely from September, with an interim grant for the March to August 17 period. The Education Services Redesign deals with the ongoing reduction in ESG funding, but the interim grant for the March to August 17 period has been confirmed at a lower rate than in the 2016/17 financial year. Consequently the Local Authority asked the Schools Forum to agree a temporary de-delegation arrangement for the 2017/18 financial year to cover the shortfall. Representatives of maintained primary and secondary schools voted unanimously to de-delegate this funding back to the LA for this purpose.
o Behaviour Support Services: As part of the Education Services Redesign this resource will no longer be de-delegated from school budgets from September 2017. This means that there is only a part year de-delegation in 2017/18.
● The 17/18 de-delegated budgets are clearly identified in the “De-delegation” section of the budget share pack for your reference.
● Please note the final delegated budget available to each school excludes the amounts that are de-delegated to the local authority.
Early Years Single Funding Formula
● Your indicative early year’s budget has been calculated based on the January 2016 census information, and the 2016/17 Funding rates. This assumes the number of 3 & 4 year old children attending your nursery classes for the Summer 2017, Autumn 2017 and Spring 2018 term is the same as in January 2016, and that all children attending take up the full 15 hour entitlement.
● Your actual early years funding level for 17/18 will be based on the census count in each term of the 17/18 financial year. Schools will be notified of their updated Early Years budget following each termly count. This means that for schools with nursery provision, your overall budget share is likely to change during 17/18.
● The split in the number of term weeks in the 2017/18 financial year has changed slightly from 2016/17 – these are calculated in line with term dates. Please see below.
Summer / Autumn / Spring2016/17 / 12 / 14 / 12
2017/18 / 12 / 15 / 11
· We are currently out to consult on new funding rates for the 2017/18 financial year. This will impact on the level of resource for Early Years. For further information, please refer to e-mail sent 3rd February 2017.
Minimum Funding Guarantee
● The 17/18 Minimum Funding Guarantee (MFG) has been set nationally at minus 1.5% which is the same rate as in 16/17.
● For 17/18 (with Schools Forum approval) we successfully applied for a disapplication of the MFG to remove the funding of the Supplementary Fund in 2016/17[6]. This ensures that the MFG protection afforded to schools is not overstated due to the removal of this funding.
● We also successfully applied (with Schools Forum approval) for a disapplication of the MFG to remove funding of £0.5M. This is funding that we have been putting in through reserve to boost funding levels over a period of 4 years. 2017/18 should have been the final year of this arrangement, but we have had to end this arrangement early due to uncertainty over national funding formula changes and the setting of baselines.
● Details of the calculation and the value of your school’s MFG are shown on the 'MFG Calculation' sheet within the budget share pack.
● In addition, there is a line on the Budget Share Statement called 'Minimum Funding Guarantee (additional funding/top-slice)' which shows the impact of the MFG on each school.
- Where there is a positive figure on this line (i.e. a number with no brackets around it) this means that the school has received this amount of additional funding in order to bring it up to the MFG level.
- Where there is a negative figure on this line (i.e. a number with brackets around it) this means that the schools budget has been top-sliced by this amount in order that the MFG can be funded across all schools.
3 In year allocations to schools outside budget shares
Top-up Funding for Pupils with High Needs
● High Needs pupils are funded on a “Place-Plus” methodology. Under this approach schools are expected to fund the first £10k of the costs for high needs pupils from their budget share allocations – this is classed as the “Place” funding.
● The Local Authority is required to fund the amount above the £10k from a centrally retained budget – this is classed as the “Plus” funding; it is referred to as High Needs top-up funding on your ‘Summary of Funding' sheet.
● Pupils with band 5 or 6 statements (or an EHCP equivalent) will be used as a proxy to delegate top-up funding to schools in 2017/18. The top-up funding rate for band 5 is £3,500 and for band 6 is £7,000.
● Top-up funding must follow real time pupil movements therefore the school’s indicative allocations will change if these pupils join/leave a school during the financial year.
● The school’s indicative high needs top-up allocation is included in the Summary of Funding statement for your reference. This is based on the number of band 5 and 6 pupils at each school at the end of the Autumn Term (2016). This budget will be updated at the end of each term during 17-18 to reflect pupil movements.
The Growth Fund
● The Growth Fund has traditionally consisted of two elements; ‘Increasing Form of Entry’ funding and ‘Class Size’ funding.
● Increasing Form of Entry funding is designed to support a school or academy that has agreed with the LA to provide an extra class from the next September to support basic need (either as a bulge class or as an on-going commitment). This funding is used in the primary sector to fund Reception & Key Stage 1 only, ensuring compliance with the Admissions (Infant Class Sizes) Regulations[7].
Funding is allocated based on the costs of a Teacher and a Teaching Assistant from the point that the new class is required, until the school’s next budget share comes into effect.
● Class Size funding is provided to a school or academy where overall pupil numbers in Reception and Key Stage 1 (as at the previous October Census) attract less funding through the budget share than is needed to notionally fund the number of classes required.
This is to ensure that schools can adhere to the Admissions (Infant Class Sizes) Regulations.
· For 2017/18 the Schools Forum have agreed an increase to the growth fund for in-year admissions. Schools will receive funding where their in-year admissions (January – December 16) exceeds October 15 census by 15% and over. This will be based on 1/3 of the basic entitlement amount.
Pupil Premium Grant (PPG)
● This indicative funding is in addition to your budget share allocation. The unit rates for 17/18 are not yet published. The Pupil Premium[8] unit rates for the 16/17 financial year (as set by the Department for Education) are as following, and apply to pupils in years R-11.
i) £1,320 per primary pupil that has been eligible for FSM in the last 6 years (Ever 6 FSM) based on January census.