22 September 2000
Councils will retain control over education funding, but will be subject to a new 'transparent' system designed to ensure that more than 90% of budgets are sent directly to schools.
Central government will set a national basic entitlement for all primary and secondary pupils, which could be topped up with an extra 20% depending on levels of deprivation and the cost of recruiting teaching staff.
Whitehall will also specify how much it expects local education authorities to spend on administration.
But the basic pupil entitlement, which could be introduced by 2003/04, would not be mandatory, raising the familiar spectre of funding disparities.
'Schools in some areas could end up with less than their basic entitlement,' an official from the Department of the Environment, Transport and the Regions conceded. 'But schools will be able to question authorities – that's a type of transparency.'
Teaching unions reacted angrily to the green paper proposals. 'It has all the hallmarks of a classic fudge,' said Nigel de Gruchy, general secretary of the National Association of Schoolmasters/Union of Women Teachers. 'It is difficult to see how disparities in funding between one council and another are going to be eliminated.'
But the Local Government Association, relieved at the reprieve, welcomed the proposals while admitting that they could create disputes between head teachers and politicians. 'There will be political arguments locally but that's where they should be. Whitehall shouldn't make those sort of decisions,' said Neil Kinghan, director of finance at the Local Government Association.
In an interview with Public Finance, local government minister Hilary Armstrong conceded that there was a 'rigorous debate' over the future of LEAs but there was now full agreement across the Cabinet on their role.
The rest of the green paper provoked an equally strong response from other groups.
The Association of London Government welcomed the further three-year freeze on Standard Spending Assessments but warned that it would oppose any moves to revalue tax bands, which could be 'disastrous'.
CIPFA described the paper as a 'wasted opportunity' and said proposals to link funding to performance were 'likely to give rise to more rather than fewer arguments' over the fairness of grant allocations.