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Since 2018-19, the national funding formula (NFF) has distributed school funding based on the individual needs and characteristics of every school in the country. This is fairer and more equitable than the previous system, which based local authority’s allocations for schools on data that was over a decade out of date.
While the majority of school funding is based on pupils and their characteristics, the NFF provides every school a fixed lump sum, worth £114,400 next year. This is particularly beneficial for small schools, which are overrepresented in rural areas, that are more reliant on an element of funding that is not driven by pupil numbers.
The NFF’s sparsity factor provides additional funding specifically to small schools in remote areas, in recognition that they do not have the same opportunities to find efficiencies as those elsewhere. Next year, £26.2 million will be allocated through this factor, which is contributing to rural schools attracting on average 4.7% more per pupil next year relative to 2019-20 NFF allocations, compared to a national average increase of 4.1% per pupil.
We keep the national funding formula under review to ensure that it is directing funding where it is most needed, and will set out our plans for 2021-22 shortly.