3. DfE should increase the national base rate for 16 and 18-year-olds

Recommendation 3

DfE should introduce fair funding for colleges by increasing the national base rate for 16 and 18-year-olds to match the Key Stage 4 rate and extending the pupil premium above the age of 16.

DfE intends to introduce a national fair funding formula for 5 to 16-year-olds by 2019-20 that will pay secondary schools a national base rate of £4,312 for all Key Stage 4 pupils with the possibility of funding at £8,472 for a pupil on free school meals (FSM), English as an additional language (EAL) and low prior attainment (LPA). In addition, the pupil can qualify for a pupil premium worth up to £2,160[1]. When the student moves into Key Stage 5, the national base rate drops to £4,000 while the pupil with multiple disadvantage (FSM, EAL, LPA) would qualify for a maximum of £5,960 assuming they lacked both English and maths GCSE at grade C. It is not straightforward to compare the two funding formulae, but the gap in resources is about 25% and continues to widen. The failure to tackle it will hold back necessary improvements for 16 to 18-year-olds. There are further issues:

Inflation will erode the value of the rate by an estimated 8% in the next four years[2]. This will be on top of a real terms cut to funding for 16 to 18-year-olds of 13.6% in the five years from 2010 to 2015[3].

Full-time sixth form study in England involves average contact time of less than 20 hours a week compared to between 25 and 30 hours a week in higher-performing countries and cities such as Sweden, Canada, Singapore and Shanghai[4].

There is evidence that colleges have cut A Level subjects in modern foreign languages and the sciences, because they can no longer afford to offer them[5]. Many colleges have narrowed their A Level programmes to three subjects[6]. Meanwhile English and maths requirements are narrowing the teaching time for technical subjects.

Modelling on the costs of a broad and balanced curriculum by the Association of School and College Leaders[7] and Sixth Form College Association shows that the rate should be nearer £5,000 than £4,000.

The positive case for higher funding rates are that they will support key Government objectives including raising the entry rate of disadvantaged young people into higher education and reducing the numbers who reach age 18 without English or maths at Level 2. Higher funding levels will also provide the space for colleges to introduce the new technical education programmes set out in the Post-16 Skills Plan. DfE should consider a long term plan to introduce a single fair funding formula. As a first step towards this, DfE should increase the 16 to 18 rate to match the Key Stage 4 rate and extend the pupil premium above the age of 16. The cost of increasing the national base rate in this way would be around £300 million while the Pupil Premium extension would cost an estimated £150 million.

 

[1] DfE National School Funding Formula Stage 2 consultation, December 2016.

[2] Calculations from GDP deflator figures.

[3] Schools Spending, Institute for Fiscal Studies Briefing Note, BN168.

[4] SFCA Costing the Sixth Form Curriculum, March 2015, Part 2 for international comparisons.

[5] http://www.bbc.co.uk/news/education-33847860.

[6] AoC analysis of Individual Learner Record date.

[7] ASCL paper on education funding, May 2015.