DfE apologises over £270m schools-funding error

Education secretary orders review of assurance process as schools forced to recalculate budgets
Photo: Simon Turner/Alamy Stock Photo

The Department for Education has apologised after an error by its officials meant schools will get less funding next year than they originally thought.

DfE published its National Funding Formula allocations in July, but it has now admitted the calculation was based on an incorrect forecast of pupil numbers.

"Specifically, there was an error processing forecast pupil numbers, which means that the overall cost of the core schools budget would be 0.62% greater than allocated," DfE permanent secretary Susan Acland-Hood said in a letter to the Education Select Committee.

In a revelation that has angered school leaders and unions, schools will receive around £50 less per pupil than they were previously told – meaning that they must recalculate their budgets. For a typical secondary school, the difference equates to a teacher’s pay for the year.

As the core schools budget for 2024-25 is £59.6bn, the error means the miscalculation would have inflated it by £370m.

Education secretary Gillian Keegan has ordered a “formal review of the quality assurance process surrounding the calculation of the NFF, with independent scrutiny”, DfE permanent secretary Susan Acland-Hood said.

In a letter to the Education Select Committee, Acland-Hood said the department had already identified some “improvements… to ensure similar mistakes are not repeated in the future”.

The core schools budget for 2024-25 will remain at £59.6bn, up 3.2% on the year before, she said.

Schools will now receive an average of £5,300 per primary school pupil and £6,830 per secondary school pupil in 2024-25. High-needs NFF allocations, which fund provision for children with complex special educational needs and disabilities, are not affected.

Paul Whiteman, general secretary of the National Association of Head Teachers, said the miscalculation “speaks volumes about the chaos at the heart of government”.

“School leaders will be rightly angry that basic accounting errors may force them to rethink already tight budgets as a result of the erroneous figures they were provided. Many may now have to revisit crucial decisions around staffing or support for pupils as budgets are reduced,” Whiteman said.

In her letter, Acland-Hood said schools have not yet received their their 2024-25 funding, “so the correction of this error does not mean adjusting any funding that schools have already received”.

“Nevertheless, we recognise that the correction of this error will be difficult for local authorities and frustrating for some school leaders, which is why the department has worked as quickly as possible to rectify the error,” she said.

“We will work closely with school stakeholders, including unions, to communicate this change and support schools and local authorities.”

Acland-Hood expressed her "sincere apologies that this error has occurred", and said she wanted to assure the committee "that rigorous measures are being put in place to ensure that it will not be repeated".

But trusts and local authorities are likely to have already planned their budgets based on the incorrect figures and will now need to revise them, according to unions.

The National Education Union said in a statement that the government is "not paying attention to the crisis in education", adding: "Head teachers have planned for that money and budgets are pared to the bone."

The news comes amid an ongoing squeeze on school resources. Even before last week’s recalculation, the July funding allocations were set to leave schools’ purchasing power per pupil about 3% lower in 2024-25 than in 2009-10 because funding has fallen behind inflation, according to the Institute for Fiscal Studies.

In a report published the day before Acland-Hood’s letter, the IFS said total funding and total school costs had both grown by just over 6% last year – which it said had left schools “just about breaking even, on average, in 2022-23”.

Geoff Barton, general secretary of the Association of School and College Leaders, called the error “extremely unfortunate and frustrating”.

"Even though schools have not received their 2024-25 funding, it is likely that trusts and local authorities will have used the incorrect figures in their budget planning and will now need to revise those budgets with the corrected figures,” he said.

"This is the last thing they need on top of all the other demands on their time."

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