Coalition plans to rebalance the way schools funding is distributed is a sensible move, but could ‘lead to significant turbulence across local authorities', leading public finance experts have warned.

At a Spending Review briefing yesterday, economist Luke Sibieta from the Institute for Fiscal Studies think-tank said: ‘The introduction of national funding formula is a welcome reform and will ensure funding to local authorities has a rational basis.'
 
Mr Sibieta said he understood the new model would operate at a local authority level and seek to preserve extra funding for schools in areas of deprivation.
 
Although extra details are to be confirmed in a consultation taking place later this year, areas of the country which have historically been ‘over-funded' such as London and the south east will see schools funding reductions - while areas covered by the f40 group would see cash increases.
 
Funding changes of as much as 10% could be experienced for gainers and losers under the new arrangements, but the funding reforms would take some time to implement and a lengthy transition was likely, he explained.

Mr Sibieta also said the continued schools ring-fence would see 3.8% real terms cuts in 2015/16 to unprotected areas of the Department for Education's budget such as early years, families and children and education for young people aged 16 to 19 years.
 
A group representing local authorities with the poorest schools funding settlements welcomed the Government's intention to establish a National Funding Formula for schools.
 
Cllr Ivan Ould, chair of the f40 group, and lead member for children and young people's services at Leicestershire CC, said the new education funding system - which would take effect after the next election - marks a huge step forward for the campaign.
 
‘The fact is that pupils and schools in f40 local authority areas have been disadvantaged by an archaic system for nearly twenty years and have been the poor relations in terms of the share of education funding,' said Cllr Ould.
 
‘Although we would have liked change more quickly – and ideally before the 2015 election – at least we can now work with the government to create a fairer system that supports pupils and schools wherever they are,' he added.