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Speech in the debate on school funding in London

It is a pleasure to serve under your chairmanship, Mr Hanson. I congratulate my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) on securing this debate and on her impassioned speech.


As my hon. Friend the Member for Ilford North (Wes Streeting) said, under this Government we are seeing the largest real-term cuts for 20 years. The schools budget will not be protected in real terms and will not rise during the Parliament, and funding will be protected only in cash terms. No planning for budgets has been put in place by the Department for Education to cover the cost pressures that have been articulately pointed out by hon. Members today, such as inflation, the living wage, pension provision and the apprenticeship levy, which the hon. Member for Sutton and Cheam (Paul Scully) mentioned. There has already been a sharp rise in the proportion of secondary schools in deficit, which has risen to nearly 60% in 2014-15, according to the National Audit Office. The NAO has also confirmed that there will be a real-terms reduction in funding per pupil because of a failure to increase funding in line with inflation. That, I am afraid, is a clear breach of the Conservative party’s manifesto commitment.

Catherine West (Hornsey and Wood Green) (Lab)
Does my hon. Friend agree that this is, in essence, an attack on all young people, regardless of whether they live in London or anywhere else in the country? This is an attack on the future generations of this country.

Mike Kane
My hon. Friend the Member for Dulwich and West Norwood pointed out that it would take 1% of the education budget to level up in London—about £500 million. Some £380 million was clawed back from the Department for Education for its failure to convert enough schools to multi-academy trusts. This can be done—it can be achieved—but, as with their U-turn last night to downgrade GCSE passes to grade 4, we can only hope that the Government will see the light on the key issue of the £3 billion of funding cuts that we face between now and 2020. The funding formula amounts only to redistributing a small sum of money while we face cuts across the board. Instead of moving an inadequate sum of money around, what is required is investment in all our schools, for every child.

The Library briefing states that

“inner London constituencies are expected to see the biggest fall in funding under the consultation proposals.”

There are particular pressures on London from the fair funding formula, as has been pointed out. The number of children on free school meals has declined in London, partly because of gentrification in particular areas, but also because of benefit changes, which mean that fewer children are eligible. That is having a disproportionate impact on school budgets in London.

The Secretary of State has said that no school should lose more than 1.5% of its funding as a result of changes to the funding formula. However, it has already been shown by the IFS and the NAO that, given the budget cuts, cuts to schools will be far more severe. Those are the figures on the union’s website.

Jeremy Quin
I come from a part of the country with £2,000 per pupil less than the London average. Will the hon. Gentleman confirm that he believes that there should be fairness in how we distribute funds between schools? That is what the NFF is about, and it is welcomed very broadly around the country.

Mike Kane
There should be fairness in the funding formula. There are good things in it, such as an emphasis on high needs, a deprivation index, a focus on prior attainment—why would we not welcome those things?—but we have seen many U-turns from the Department. I would bet my bottom dollar that, with the pressure that is coming from all hon. Members, we will see another one. I am worried that we will also see a U-turn on some of the good things about this funding formula.

The financial challenges of providing London school places is huge, because of the cost pressures and land values. That is why we have seen the Government U-turn on the 50% faith school cap. The Catholic Church needs to build at least 40 new schools in London and the Government have had to U-turn on their policy from 2010.

The free school programme in London is not subject to any spatial planning whatsoever. There was a school in Bermondsey that recently closed down after £3.5 million was spent in two years on educating 60 pupils. That was £60,000 per pupil. As my right hon. Friend the Member for Tottenham (Mr Lammy) said, we could have sent those pupils to Eton for half the price. That is what happens when there is a free school programme that is not subject to spatial planning.

James Berry
Will the hon. Gentleman give way?

Mike Kane
I will not give way, if the hon. Gentleman will forgive me. I really am up against the clock.

The Education Funding Agency is paying inflated prices for land, particularly in London. Funding issues are hitting teacher recruitment, as has been articulately pointed out. Pay in real terms for teachers has fallen by 10% since 2010. The jobs market is beginning to pick up, no wonder we are failing to meet our graduate targets for teacher training, which adds to the pressures. The cost of living, as has also been pointed out, and the cost of childcare are exacerbating the problems, as is inflation. My hon. Friend the Member for Mitcham and Morden (Siobhain McDonagh) has been articulate for weeks and months in the Chamber on the effect of London’s housing crisis, which means that teachers are priced out of the market.

As I have said, the Opposition would love to support elements of the funding formula. I remember the joke by Peter Kaye, who is a Bolton comedian. When his children were trying to get to sleep but could not do so because of the “wardrobe monsters”, he rang them up and said, “Don’t worry about the wardrobe monsters. It’s the burglars coming in through the roof!” This issue is not about the funding formula, a high needs index, a deprivation index or the focus on prior attainment; it is to do with cost inflation. The Minister should stop confusing the matter for his own Back Benchers and for Parliament. The national funding formula will not touch the sides of what needs to be done to avert a massive crisis in our schools.​
We need change. The Minister should not bang on about the funding formula. He needs to address the cost pressures that all schools face. He needs to tell them, which he has not done so far, how they are to make the savings required. More importantly, however, he needs to tell us how he will change his mind in the weeks and months to come.

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