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School budgets will be about 3% lower in 2024-2025 than in 2009-10 because costs are rising faster than economy-wide inflation. Image Credit: Bloomberg
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London: UK government efforts to reverse years of spending cuts for schools in England will still fail to cover their escalating costs, leaving state education under severe strain, according to the Institute for Fiscal Studies.

The government is increasing school budgets to undo cuts made during the years of austerity after 2010. The Department for Education claims “funding will be at its highest ever level in real terms per pupil” next year after a record 60 billion pounds ($72.9 billion) of support.

However, the IFS said in research published Thursday that the boost will not make up the shortfall. School budgets will be about 3 per cent lower in 2024-2025 than in 2009-10 because costs are rising faster than economy-wide inflation.

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The study underscores the pressures on the English state education sector, a potential problem for Prime Minister Rishi Sunak ahead of a general election expected next year. Budgets will continue to remain tight after 2025 under government plans that imply no further real-terms increases, the IFS said in March. This week Chancellor Jeremy Hunt said he wanted to find further in efficiencies in public services to create room for tax cuts.

Schools have been struggling since the pandemic, with absence levels up and teachers striking for better pay. Dozens were shut down last month amid fears that buildings with weak reinforced autoclaved aerated concrete (RAAC) could collapse. In his speech to the Conservative Party conference Wednesday, Sunak pledged to make education funding his top priority.

“Why? Because it is the closest thing we have to a silver bullet,” he said. “It is the best economic policy, the best social policy, the best moral policy. It the best way to spread opportunity and to create a more prosperous society.”

In its analysis, the IFS said the government was right to claim that funding per pupil will be at a record high next year - but only when using prices in the economy as a whole. School costs are rising much more rapidly, meaning institutions are facing reduced rather than enhanced spending power.

“General measures of economy-wide inflation are not currently providing an accurate picture of the cost pressures actually faced by schools. Their costs are growing faster, particularly support staff pay, energy and food costs,” the IFS said.

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“As a result, school funding and costs are growing at similar rates between 2021-22 and 2024-25, leaving school budgets to largely stagnate in real terms. This would leave the purchasing power of English school budgets in 2024 about 3 per cent lower than in 2010.”

A Department for Education spokesperson said, “School funding will be 3 per cent higher, in real terms per pupil, in 2024-25 compared to 2010. That includes an additional 2 billion pounds for both this year and next, recognizing the higher costs schools are facing and matching both inflation and what the unions told us was needed.”

Daniel Kebede, General Secretary of the National Education Union, said the report was a “valuable contribution to the debate.”

“It highlights that the headline figures on education funding do not translate into funding increases per pupil once school-specific costs are taken into account,” he said.

“The education system also needs to deal with past underspending on capital projects, which has resulted in the RAAC crisis. We currently spend around 2.6 billion pounds a year. It needs to rise to at least 7 billion pounds a year to fix the school estate.”