Capital Funding for Schools inquiry

The system for funding new schools and new places in existing schools is increasingly incoherent and too often poor value for money. The Department for Education (the Department) is spending well over the odds in its bid to create 500 more free schools while other schools are in poor condition. Many free schools are in inadequate premises, including many without on-site playgrounds or sports facilities. The Department believes it is acceptable to appropriate community facilities and parks for routine school use. Add to this that local authorities are legally responsible for ensuring that there are enough school places for all children to attend good schools, even though they have no direct control of free school or academy places or admissions policies. All this made us question how much of a grip the Department really has in providing school places where they are needed. Having enough school places in safe, high-quality buildings in the areas where places are needed is a crucial part of an effective education system. Without this, parents may have less choice, pupils may have inconvenient journeys to school and the learning environment may be less effective, putting educational outcomes at risk.

The Department provides capital funding, totalling £4.5 billion in 2015–16, to maintain and improve the quality and capacity of the school estate. It faces significant challenges over the next few years in this regard. Many school buildings are old and in poor condition, and the condition of the estate is deteriorating. Poorly maintained buildings can affect the quality of children’s education, and in extreme cases schools may have to close while buildings are made safe. In addition, a further 420,000 new school places will need to be created by 2021 to cater for the growing school-age population. Some of these places will be in new free schools.

We are concerned that there is a tension between setting up new free schools and supporting existing schools. Free schools are helping to meet the need for new school places in some areas but are also creating spare capacity elsewhere. Some localities have spare capacity of over 20%, which has financial implications—schools with unfilled places have less income than if they were full because funding is linked to the number of pupils. In the context of severe financial constraints it is vital that the Department uses its funding in a more coherent and cost-effective way. The Department indicated that its priority is to meet the Government’s target of creating 500 more free schools by 2020, but we remain to be convinced that this represents the best use of the limited funds available.