Schools in England are facing a looming financial crisis, with spending per pupil in 2024-25 expected to be 3% lower than in 2010, according to a study.
After a decade of austerity cuts, ministers have promised to restore funding per pupil to 2010 levels by the end of the current parliament, but the Institute for Fiscal Studies (IFS) says the government is no longer on track to meet its target due to spending pressures on schools.
IFS research estimates that the increased costs facing schools are “almost affordable” for the next academic year due to a £4bn increase in schools’ budgets this year.
However, he warned that the government’s future spending plans were insufficient and real-terms cuts would follow, undermining the role schools could play in his equalization ambitions.
Meanwhile, school leaders say they are already struggling to balance their budgets in the face of massive increases in food, energy and wage costs, with many warning of deficits and more cuts to education provision.
One finance manager said a secondary school in her trust had seen its electricity bill jump from £75,000 last year to £213,000. They were also worried about how to meet teacher pay rises without extra government funding and costs already cut to the bone.
Julia Harndon, funding specialist at the Association of School and College Leaders (ASCL), said: “It reflects very poorly on the Government’s priorities that it will preside over a 15-year decline in school funding by the end of this Parliament.
“While it could be argued that there are inflationary pressures beyond its control, the fact is that the government itself has offered a pay award to teachers for September without providing additional funding for schools to meet these costs, and also consistently ignores our repeated warnings about the impact of skyrocketing energy costs.
The situation in post-16 education is even worse, Harndon said, citing IFS analysis last autumn which showed that college funding per pupil in 2024-25 was 10% below 2010-11 levels. , while sixth form school funding per pupil will be 23% lower .
“Increasing cost pressures are likely to worsen this desperate situation,” she said. “The government simply needs to respond by ensuring that schools and colleges have the funding they need to at least maintain supply, and if the government is serious about raising student achievement, it needs to provide the resources that are needed, to make this ambition achievable.’
Sarah Ewins, chief financial and operating officer at Middlesex Learning Trust, said schools in her trust had struggled to set balanced budgets for September in the face of rapidly increasing cost pressures, including energy costs rising by 200% just for all their planning to be blown up by the announcement of the teachers’ pay award on the last day of term, which added an extra £95,000 to each school’s expected wage bill.
“We fully support paying teachers and support staff properly (especially given the years of real pay cuts), but we simply cannot do this without additional funding.”
The Department for Education said it recognized that schools were facing increased costs due to the unprecedented rise in inflation. “To support schools, budgets will increase by £7 billion by 2024-25, compared to 2021-22, with the total core school budget increasing to £56.8 billion. In the current financial year alone, schools’ core funding has increased by £4 billion compared to the previous financial year.
The Government’s recently published Schools White Paper set a target of 90% of primary school pupils achieving the expected standard in reading, writing and maths by 2030. Ruth Maisey, Head of Education at the Nuffield Foundation, which funded the research, said: “Essential it is important that the Government addresses the spending pressures highlighted by this IFS analysis to ensure schools can meet ambitions for student achievement.’
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Labor has accused the Conservative leadership contenders of “bubbling” on the return of grammar schools during the campaign, instead of promising real action to secure children’s education.
Shadow schools minister Stephen Morgan said: “The Conservatives are failing our children with staff cuts, school buildings in disrepair and fewer trips, clubs and enrichment activities.”
Dr Mary Boustead, joint general secretary of the National Education Union, said: “School funding has been stagnant for too long, failing generations of young people. This allows for buildings to be destroyed, the loss of vital personnel, and the siding or removal of entire sites. These deprivations date long before Covid and the cost of living crisis.”
Paul Wightman, general secretary of the National Association of Head Teachers, added: “There is no doubt that the reality of the Government’s current approach to education funding will lead to cuts in education, services and school staff next year.”
Luke Sibietta, IFS research fellow and author of the report, said: “The big fiscal choice for policymakers this autumn is whether or not to provide more funding to public services to offset the rising costs and significant challenges they face. It will be all the more difficult for schools to make a meaningful contribution to raising ambitions when they face real cuts from next year onwards.
The Ministry of Education has been contacted for comment.
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