Empowering teachers, parents and communities to achieve excellence and equity in education: governance review

7. Fair funding - learner-centred funding

Effective governance requires funding to be fair and transparent and for resources to be available to support good decision making. The Scottish Government is committed to establishing a fair and transparent needs-based funding formula for schools.

The Scottish Government provides local authorities with the majority of their funding which is allocated using a needs-based formula. The formula takes into account a number of measurements of need including population, pupil numbers, levels of deprivation and the distances over which the services have to be delivered. It is then the responsibility of local authorities to allocate their total funding as they see fit taking into account local and national priorities.

Local authorities delegate responsibility for some aspects of the administration and management of schools to headteachers. In line with the Devolved School Management guidelines (2012), local authorities currently provide financial resources (with certain restrictions) to headteachers.

We will consult on proposals for a funding formula in March 2017 but this review offers an opportunity to comment on the principles which will underpin this formula. The way we fund schools needs to support the collaborative and flexible culture which we are seeking to develop.

If schools are to have greater control over the decisions they take, there is a clear rationale for changing the current allocation of resources to support this.

We consider that the design of a funding formula should:

• support excellence and equity - ensuring every child and young person has the same opportunity to succeed
• be fair - placing the needs of all children and young people at the centre
• be simple, transparent and predictable - ensuring the costs of delivering education can be easily understood and explained and that schools are able to manage and plan ahead with certainty
• deliver value for money - ensuring that every penny spent is used effectively

Question 14

Should the funding formula for schools be guided by the principles that it should support excellence and equity, be fair, simple, transparent, predictable and deliver value for money? Should other principles be used to inform the design of the formula?

Question 15

What further controls over funding should be devolved to school level?