We now move on to the debate on the Children, Young People and Education Committee report, 'School Funding in Wales', and I call on the Chair of the committee to move the motion. Lynne Neagle.

Motion NDM7166 Lynne Neagle

To propose that the National Assembly for Wales:

Notes the Children, Young People and Education Committee Report—School Funding in Wales, which was laid in the Table Office on 10 July 2019.

Motion moved.

Thank you, Deputy Presiding Officer. I'm pleased to open this debate today on the Children, Young People and Education Committee’s report into school funding in Wales. Access to high-quality education is a fundamental right for all our children and young people. It should not depend on where you live, on your social background or the language in which you learn. 

The Llywydd took the Chair.

A good education is one of the most important building blocks a child can receive. However, all too often we hear about the huge pressures being faced by schools in trying to manage their budgets where the funding they receive is not sufficient. This is clearly having a negative effect on the provision of education, including schools having to make staff cuts in order to balance their budgets.

Issues had also been raised about the level of transparency and variation in the distribution of funding for schools and there has been debate over the balance between unhypothecated funding for local government and the more targeted funding aimed specifically at Welsh Government education priorities. More recently, we have heard widespread concern that insufficient school budgets would inhibit the delivery of the Welsh Government’s education reform agenda.

There is an immense and unprecedented level of reform going on in education. We have the radical new curriculum for Wales, a major new additional learning needs Act, the delivery of the whole-school approach to mental health and wide-ranging reforms to professional learning underpinning them all. We cannot expect these major reforms to succeed without adequate funding.

In light of this, the committee agreed to undertake the inquiry to look specifically at both the sufficiency of school funding in Wales and the way in which school budgets are determined and allocated. In taking the inquiry forward, we took evidence from a wide range of stakeholders across the sector. We also undertook detailed case studies with three schools, in which we met with people at all levels—pupils and parents, teachers and school leaders, local authorities and school governors. What we heard in all three schools was very hard-hitting, and, on occasions, alarming. Seeing directly the effect of budget constraints on those on the front line highlighted just how urgently this situation needs to be addressed. I would like to thank all those who took the time to meet with us during the case studies, and for their honest views on the problems being faced.

In total the Committee made 21 recommendations, covering a wide range of issues. In the time available today, I can't cover all our recommendations. I will, however, outline some of the main concerns raised. We are pleased that the Minister for Education has accepted all of the recommendations in our report and the broad welcome she has given to the committee’s work in this key area. It is concerning, though, that the Minister’s response lacks clear detail on how a number of the recommendations will be taken forward. And I hope that the Minister will be able to expand on her response during the debate today on a number of those key recommendations.

In outlining the findings of the inquiry, I’d like to start with the most worrying conclusion we reached as a committee, and where the evidence received was overwhelming. Put quite simply, there is not enough money going into the education system in Wales and not enough finding its way to schools. We saw this first-hand during our school visits. As we've outlined in the report, this is a simple conclusion that, unfortunately, does not have a simple solution. The system for funding schools is hugely complex, multilayered and dependent on many factors, not least of course the amount of money available to the Welsh Government from Westminster. It must also be recognised that responsibility for providing adequate funding for our schools cuts across ministerial portfolios. Given the complexity of the funding formulas, Ministers across Welsh Government must work together to ensure that schools receive the funding they need.

Additional funding for education is essential—and I’ll return to this point shortly—but while it would have been easy to simply recommend additional funding, we believe that increasing the level of funding alone is not the solution. The funding must also be used effectively and in the right places. To fully understand the problems being faced by our schools, it is crucial that we first know the extent of the funding gap facing the education system in Wales, particularly at this time of substantial reform. We need to understand how much it costs to run a school and to educate a child, as a basic minimum, before all necessary factors such as deprivation and sparsity are taken into account, as well as the huge reform agenda.

Recommendation 1 in our report is therefore clear in its call for the Welsh Government to undertake an urgent review to establish this. The response from the Minister has been very positive, confirming that work has already started between Welsh Government and local government to consider the scope of the review. I look forward to receiving an update on action in due course from the Minister. Can I say, though, that whatever the outcome of that inquiry, it cannot be put in the ‘too difficult’ box, as has happened with previous reviews on school funding, such as the Bramley review in 2007 and the years that followed?

Returning to the issue of additional funding, I’m sure that Members are aware that recent funding announcements for education in England have led to a consequential of nearly £200 million for Wales. In view of the fact that the Welsh Government has accepted all the recommendations of the committee’s report, I would hope that most, if not all of this, will be earmarked for education in Wales.

As our report sets out, the problems being faced are not just about the level of funding for schools but also about the way it makes its way to the school front line and how it is used. This clearly depends on a number of factors, including budget prioritisation at a Welsh Government level, how resources for local government are shared out between authorities, whether local authorities prioritise schools within their own budget-setting process, the extent to which they delegate funding to schools themselves, and how they distribute that funding between schools.

Given the complexity of the system, we were concerned to learn that the Welsh Government does not monitor the level of priority that local authorities give to schools within their distribution of funding. Welsh Government has been very clear throughout the inquiry that local authorities are responsible for allocating resources to education, and are democratically accountable for this. While we accept this position, we believe that given Welsh Government's overall responsibility for education, they must be able to satisfy themselves that local authorities are sufficiently prioritising education.

Recommendation 5 of the report, therefore, calls on the Welsh Government monitor this spend more closely, to assure itself that sufficient funding is being provided to enable schools to effectively deliver what is required of them: high-quality education, and also to improve and deliver on the reform agenda. While the Minister has accepted this recommendation, the detail in her response does not provide any indication of how the Welsh Government will undertake the greater monitoring role we called for. We will therefore be seeking further clarification from the Minister on this issue.

In the evidence we received, there was confusion about the purpose of indictor-based assessments within the local government settlement. The clear position of the Welsh Local Government Association and the Association of Directors of Education in Wales was that IBAs have limited influence on how much is spent on education. However, the headteachers' unions argued that there's little point establishing IBAs if local authorities do not take account of them. While we accept that funding for local government is unhypothecated, we believe the Welsh Government must provide greater clarity on the purpose of IBAs. While they are not a prescription of how much a local authority must spend, are they not at least the Welsh Government’s estimate of how much a local authority should need to spend in order to maintain a standard level of service? That is not entirely clear from the Welsh Government’s response to recommendation 6.

Llywydd, there are many more important issues raised during the inquiry that I would like to discuss but cannot cover today. I would like to conclude by saying that I truly believe the lack of adequate funding for our schools is one of the biggest problems facing our public services. To reiterate, I very much welcome the Minister’s agreement to commission a review to identify how much money the schools system in Wales needs and look forward to further information on that.

Investment in education is the most important preventative investment that any Government can make. The time has now come for us all to work together, across parties, across both Welsh Government and local government, to ensure that our schools have the funding they need to provide the high-quality education that all our children and young people deserve. Diolch yn fawr.

Can I thank you, Lynne? I don't think Welsh Government should have been particularly surprised at the content of this report. Per-pupil funding for schools has been historically poor compared to the rest of the UK, and the chickens have finally come home to roost. Teachers, school leaders, unions like the NAHT and council leaders have been genuinely fearful about the vulnerability of schools to crumbling finances, and I thank them all for coming before the committee to give us their evidence. And as well as their worries about the overall amount available to schools, teachers and school leaders have been extremely alert to that visible disparity between councils and the invisibility of why those disparities are there.

Despite the long-standing pupil funding gap, Welsh Conservatives signed up to this report because we thought there was an issue regarding UK Government funding. Even though we could have pushed the obvious point of the Welsh Government choosing how it prioritises its spending, and the extra money per head provided by the funding floor, some of these concerns are UK-wide, so fixing the problem had to lie partly with London. But London has responded. As a result of the shrinking national deficit, the UK Government has committed £7.1 billion to schools over the next three years. The Institute for Fiscal Studies says that this will restore the value of the pot of money for schools to where it was before the effects of the financial crash bit. This means about £355 million extra coming to Wales from the UK schools budget—and that is the schools budget, not the education budget—over the next three years. The Minister now has the clarity to allow for multi-year commitment, as she asked for in accepting recommendation 15.

The £195 million for Wales coming from the UK schools budget for 2020-1 as a result of this year's spending review—we heard from the Trefnydd a couple of weeks ago that the decision has not been made on how that money is going to be spent. I hope we find out that that's allocated soon, because in the last three years the pupil funding gap between Wales and England has noticeably narrowed—the NASUWT says it's £645; Welsh Government says not. But narrowed it has, because the number of pupils in England has grown considerably over the last few years and funding there has not caught up. In Wales we've had only 29 extra pupils in that 10 years, but the long-standing funding gap—and let's remember it's been as much as £800—is still there, despite the funding floor.

The gap has been the result of long-term budget decisions made by Welsh Government, not the UK Government. It predates and arises from different reasons from those affecting schools in England, and unlike Welsh Government, the UK Government has acted relatively swiftly, reversing the real-term cuts that have affected the value of that school funding pie. So, the question now is, now that this extra money is coming on-stream, whether we see the per-pupil funding gap open up again. Because if it does, it will be completely clear that this is a choice made in Cardiff Bay, not one in London.

Would you take an intervention?

Very quickly. I might move on to answer your question, actually.

I have to say, it really isn't like you, Suzy Davies, to take this kind of central office-brief approach. You were part of the committee, and it's a constructive report. It isn't intended to be in the way you are presenting it, as dividing between UK and Cardiff Bay. Please can you be more constructive and reflect the views of the committee?

Let me carry on, because, of course, as Lynne Neagle mentioned in her opening remarks, Westminster was mentioned in this, and I think it is worth us noting that Westminster has now responded to concerns that have only been made apparent to them in the last four or five years. Welsh Government has not responded to the per-pupil funding gap that's been presented to them since I've been here and before. So, what I want to say is that, even if Welsh Government commits the entire £355 million to schools—not education, schools—then we hit, as the committee report says, the local government funding fog, and this is what I want to concentrate on now. Because, in some ways, I really wish that the local government Minister was here responding to this debate, because I think it's at local government level that the urgent action is necessary.

Now, I accept that there are wider pressures on the revenue support grant, but what this report has exposed is what looks like the arbitrariness of how schools are funded. The huge disparity in reserves and deficits between schools is evidence of something going badly wrong. There is no consistency between local authorities on how they prioritise core spending on schools and no line of accountability to Welsh Government connecting its decisions on how much schools need, its consequent contribution to the RSG, and how much councils actually spend on schools.

I find myself asking whether local authorities should be entirely free to use money found by Government to address a particular, identified problem on something else altogether. Spending, as Lynne Neagle said, on good school experience is the epitome of preventative spend and, therefore, sufficient school funding should axiomatically be a priority for every single council. But, as Government admits, it will not influence the prioritisation, despite accepting recommendation 2.

Both Ministers, in evidence to us, reached for the importance of professional trust between Government and councils for their decisions. But what about the professional trust between school staff and councils, and schools and Government? Even in accepting all our recommendations, the Minister has avoided answering some of those questions actually captured in recommendations. There is an uncomfortable question about who she trusts most to deliver her aspirations for school age, because it seems to me that she is happy to trust school leaders with the huge responsibility of designing a new curriculum, but, when it comes to financing the school in which to deliver it, that's for someone else and it’s not clear to me who, yet it will be school leaders who'll carry the can if the curriculum fails due to lack of money for schools.

Your legacy, Minister, will depend on you solving the school funding problem set out so starkly in our report. I really hope this report helps you, and the local government Minister, get the money that you need for schools. Thank you.

I was very pleased to be part of this important inquiry, and there are important recommendations that are being presented in this report. It should be an exciting period for education in our schools in Wales. The introduction of a new curriculum that respects the skills of our teachers is a concept that Plaid Cymru has supported across the years.

But, unfortunately, if this huge change is not supported by funding and sufficient resources, there’s a genuine risk that we will lose this golden opportunity, and the introduction of the new curriculum will be inconsistent at best around Wales and, at worst, will be a complete disaster. Amid this, our children and young people will suffer.

The paper that was published this week, called ‘Fit for the Future Education in Wales’, draws attention to this exact problem, noting the concern about the level of resources available to teachers to develop and to provide the new curriculum, and that there are few signs that a significant injection of funding is going to happen at a school level and across the system before the launch in 2022.

The NAHT quotes figures from schools this year, compared with the previous year, in order to outline the problem as it exists at present. I do think it’s important for us to outline the crisis that needs to be sorted.

So, starting this year, there were 1,286 more pupils, but 278 fewer teachers and 533 fewer support staff. So, from those figures, it is obvious that the budget cuts that are described in detail in the report mean that there are no teachers appointed to many of the vacant posts and that cuts mean that fewer teachers work full time and more are working part time, and that the support staff are the first to be hit by losing their jobs, working fewer hours or by schools failing to renew their specific contracts.

One primary head told us, ‘We’re on our knees’. This is a genuine concern, and steps have been taken by the Welsh Government to reduce the burden on teachers, but a lack of funding in schools is adding to the workload and, of course, this is having a detrimental impact on the education of our children and young people.

So, I welcome recommendation 2 by the committee more than the others—the others are important, but recommendation 2, in my opinion, is the one that’s going to bring the greatest change that is needed. The implementation of recommendation 2 would mean that there would be reasonable class sizes to ensure that teachers could give adequate attention to every child. It would mean sufficient numbers of support staff and enough capacity in the additional learning needs staffing to identify problems as early as possible, and would give greater support to mental health problems across the education system.

Even though I do welcome recommendation 1 on the review, I do think it’s important that we shouldn’t wait for that, as that would decelerate the process and the funding needs to flow into our schools now. It’s important for the review to be clear about the initial assumptions and to ensure that there is a range of models in terms of schools and costs taken into consideration. For example, there are differences between the cost models for big schools and small schools, and rural and urban schools, and so on and so forth.

There are a number of sensible recommendations in the report about the different aspects of this, and I do think that recommendation 15 is one to draw attention to and is a high priority, namely the creation of three-year funding settlements. Now, I know that there are difficulties in terms of depending on Westminster timetables, but I do think we need to find a way of doing this. There is another group of recommendations involving the middle tier, and I’m looking forward to seeing the work of Professor Dylan Jones. And there is a problem here. There is a lack of trust between schools and the regional consortia, and a strong feeling that there are great sums being spent on that level, or that tier.

What is important, I think, is recognising what’s in recommendation 2. If we do that, then the discussion could move forward. And I do believe that we need to turn, as the committee Chair said. We need a mature discussion across the Chamber, across the ministerial responsibilities, to think differently about the Welsh budget and to think about the Welsh budget in a preventative way.

Can I start by thanking those who participated in the inquiry, and thank the Welsh Government for its very positive response to the committee's recommendations? Inevitably, I think we will probably all be covering a number of the same areas, so please bear with me. But, for me, this inquiry clearly showed that the issue of school funding is not as straightforward as some would like to suggest. So, even if we start from the premise that we all accept that schools need more money, and we all do, there's certainly no straightforward answer to the question of how much do schools actually need, how much should that be. As the Minister said in her response, this is hugely complex and multi-layered, and is dependent on many factors.

I think therefore that recommendation 1, which Siân has just referred to, of the report is very much framed to provide the evidence to help us answer that question and to provide a firmer basis for the discussion about school education and its funding in Wales. It's what we did around the NHS funding through the Nuffield report, and I think a similar study for education can only be helpful.

During the inquiry, I felt there was considerable misunderstanding about education and schools, actually, the school system in Wales, or at least I felt that there were people that were using the system to present layers of mystery based on complexity. That included arguments over gross expenditure, per pupil expenditure, the purpose of indicator-based assessments. And some of those debates are very technical, and we heard conflicting arguments as to the importance of the data that was represented. So, I do welcome the agreement of Welsh Government to try to provide a clearer understanding and a greater consistency in the statistical gathering and reporting.

Now, as we all know, there are at least four levels of financial decisions in the system. We start with the UK funding to Wales. I do have to support my colleague Hefin David here in challenging what Suzy Davies said, because this is set against a backdrop of a decade of Tory austerity. So, for every Welsh Conservative voice in this debate asking for more money for schools, reflect on the manifestos that you stood on—

Will you take an intervention?

—and the spending cuts that you have imposed on Wales. I'll take your intervention.

I'm very grateful for you taking the intervention. The reality is that there is a combination of factors that deal with school funding, not only the cash that is coming from Westminster, which you've already heard is going up by hundreds of millions of pounds from next year, but also it's affected by the way that you carve up that cash here as a Welsh Government, and the way that you distribute that cash across Wales. Now, the reality is that, in my own constituency in north Wales, both of those local authorities have been hit by a huge squeeze on their finance as a result of increases in council funding coming to places in south Wales, such as Cardiff, Newport, Swansea, Rhondda Cynon Taf, Merthyr Tydfil and others, while at the same time cuts are being imposed in Conwy, Denbighshire, Flintshire, Gwynedd and Anglesey. Why is that the case? Unacceptable.

That is not true.

Absolutely true.

Well, I assume Llywydd will give me some extra time now in my contribution because I'm sick to death of standing in this Chamber week after week hearing the Tories call for more spending on all our public services when you have presided over 10 years of austerity. We will take no lessons from the Conservatives on spending.

Secondly, Welsh Government budget decisions, which I'm now going to come on to, including the allocation to local authorities and the funding directed to delivering national education priorities. Thirdly, local authorities' decision in their local priorities, which includes education school spending and the local schools funding formula, and, of course, finally, priorities set by local school leadership themselves for the individual needs within the schools.

So, as we know, the way our education system works in Wales is through national policy and some national grants like the pupil deprivation grant—which, again, Suzy was talking about earlier on, a policy that helps to overcome disadvantage—the regional consortia, which help to challenge and raise standards, and also shared services, which help to make it more cost-effective for local authorities and schools, and the local authority priorities, which include the funding formula for school funding. And this is all very nicely captured, actually, in the diagram that was on page 22 of the report, and I commend it to you as part of the understanding of this inquiry. It neatly shows us how money flows around the system. But those facts lead me to my next point, which is that the funding allocated by Welsh Government and local authorities needs to support the whole of that education schools system, and, in times of financial restraints, the reality is that, in order to increase funding in any particular part of the system, then decisions are required on who gets more, and, therefore, who gets less, and that's a key challenge for the whole system to respond to the needs in our communities.

So, it is right that recommendation 2 of the report stresses the need for preventative spending and the link with recommendation 4 about the importance of a needs-based approach to the allocation of funding. For me, that includes a high priority on the need to focus on tackling the impact of poverty on the prospects and the achievements of our children. But I also want to echo what Lynne Neagle said at the outset of this debate about the scale of the education agenda that we're currently pursuing in Wales, and I think it's worth reminding us that we're talking about the new curriculum, we're talking about the transition through to the ALN, we're talking about encouraging a whole-school approach to mental health, along with the support and development of teaching staff. So, education and school funding, within a framework of preventative spending, is a major funding issue for Welsh Government in the decade ahead, and, as a result, I hope that we are seeing some turn around after years of Tory cuts—we'll wait and see if the money comes our way—so that we can start to improve the funding situation for local authorities and for schools, and that the Welsh Government and local authorities are able to deliver an improved understanding on the funding needs of our schools, but we must also recognise that, even if councils get more money, how much of that money reaches schools does still depend on the priority of each school—sorry, each local authority.

Finally, Llywydd, we should also remember that the results achieved in our schools are not solely linked to the amount of money that they receive. There's a lot of evidence to show that, even in schools spending the highest sums of money, the attainment levels are often lower than in some schools spending far less, and I'm not sure we've got to the bottom of why that is.

And, while I agree with recommendation 21, which reminds us that the Welsh Government need to ensure the money is finding its way to the front line for the purposes intended, the debate about school funding should not distract us from the discussions around raising performance, in which school funding is only one factor. 

Can I thank the committee for this report and can I say that we will be supporting the motion? Funding our schools, as with our NHS, has always been a controversial issue, but, as with the NHS, we cannot fail to ensure that our education system receives adequate funding. Whatever financial pressures our local authorities are under, school budgets are not the place to make cuts. Only by funding our schools at a level that ensures our children get the best possible education and, thus, the best start in life, can we ensure not only their futures but the future prosperity of the country as a whole. Education is the bedrock not only of our economy but also the social fabric of our society.

Minister, the world is changing. It is no longer good enough for us to keep up; we need to be ahead of the game, and that, in a modern industrial economy, means the highest quality education system possible. The changes that artificial intelligence will bring as well as many other advances in science and communication systems will put more and more pressure on all those engaged in the education sector. We cannot let them down with inadequate funding.

In a technological world, our education system is open to extreme pressures, and this means that the teaching profession will need to be continually training to meet those pressures. So, the question is how do we meet the challenges ahead and provide the funding levels that should make our children the best educated in the UK, if not the world.

We know the problems we face and we have to accept that resources are finite. Perhaps, then, we have to look to some radical solutions. In this, I mean it is time money allocated in the Welsh Government's education grants goes directly to schools rather than to local authorities who top-slice the money to fund local education departments. It is the schools and the teaching—[Interruption.] Yes, of course.

You do realise the major expenditure by local education authorities centrally is on pre-school transport?

They can, of course, be done by the authority directly itself, if that is the case at this moment in time.

It is the schools and the teaching professionals who run them who know best where to spend the funds available. They are in the best place to decide priorities. Let's put our trust in these professionals.

I was told by a headmaster some years ago about the inflated costs he faced when having repairs done to his school—£500 to repair two holes the size of dinner plates in his schoolyard, which he could have had done professionally for £100. And £1,100 to replace a sliding window, which a father of a pupil, a professional carpenter, said he could have replaced at £90. Just two instances where the school budget is being wasted. These are moneys that should be going to educate pupils. If we have to accept that funds are finite, we should not be wasting those funds that are available.

I would like to thank Lynne Neagle AM for her leadership as our chairman of the CYPE committee, the preparation of this report and also for introducing it here today. She has hit the nail on the head: there is simply not enough money going into the Welsh education system, and certainly not enough finding its way into our schools.

Now, of course, since the publication of this report—[Interruption.] I haven't even started. Sorry, I can't.

Since the publication of this report and, thankfully, our Prime Minister, the Rt Hon Boris Johnson MP, has announced that the Welsh Government will receive £1.24 billion extra spending directly for schools. This money will provide an opportunity for the education Minister to take decisive action to close, if not crush, this £645 per-pupil funding gap between England and Wales. Earlier this year, the National Association of Schoolmasters Union of Women Teachers' representative told us that it was the worst year for Welsh school budgets since 1995, and, sadly, things are only set to get worse because the Minister herself, actually, is in denial about this.

The WLGA have projected that the school budget gap will rise further to £319 million in 2022-23, and the cuts this is causing are crippling. For example, the number of teachers has fallen by 1,500 between 2010 and 2018, despite there only being 29 fewer pupils. There needs to be sufficient funding of schools, so I am pleased that recommendation 1 has been accepted. I will be following the urgent review with much interest because I believe that we need to know, however, the timings on this and by when we can hope to have a base figure for running a school and educating a child here in Wales.

Now, the report also gets to grips with monitoring the level of priority that local authorities give to schools within its distribution of funding and puts us on track to have a better understanding and tackling the known inconsistency with setting school budgets by 22 authorities. For example, the inequitable situation is exemplified when considering that the amount spent by authorities on schools can range from £5,107 to £6,456 per pupil. So, we are in a peculiar position where 501 schools held reserves above the statutory thresholds whilst 225 were in deficit as of March 2018. Shockingly, 70 per cent of Welsh secondary schools are currently in deficit. This is a priority problem.

I wonder, therefore, why the response to the recommendation about deficits does not explain how you are working with local authorities to explore effective management. I welcome your continued commitment to challenge regional consortia about money reaching the front line. The National Education Union have told us that they have had problems with the consortia since they were first established. The evidence we have received shows a lack of understanding of the roles of local government and regional consortia. I cannot criticise the confusion as even you are still working on providing clarity. And, Minister, I do recall during my scrutiny of you during one of your ministerial presentations to us at committee, you said, 'Janet, even I cannot follow the money from the Government to the schools', so there is a concern that if you can't follow it, how are our headteachers and, indeed, our parents able to follow it?

There is no bigger area calling out for clarity than spend on school improvement. In 2018-19, despite spending £11 million on purchasing school improvement services from consortia, local authorities also spent £10.9 million on school improvements. So, I strongly support the calls for an urgent comparison of both those spends. There is no room for duplication of work and financial frivolousness. The funding in the system must be made to work as effectively as possible as the school situation currently is unsustainable. For example, a headteacher in north Wales contacted me only yesterday to explain that teachers are leaving the profession and are not being replaced, teachers are reducing their hours due to budget pressures, and support staff are being hit by redundancies and reduced hours. So, I will be voting for the best interest of young people and our hardworking teachers, and I therefore support all the recommendations.

However, I do believe that you, Minister, can go further through addressing the queries I have raised to help provide a boost to schools from here, the Welsh Labour Government, as our Prime Minister has done from the UK Government.

I think, like others this afternoon, I wish to express my gratitude to the committee for this report. I think it's a real testimony to the work and commitment of the whole committee and also the leadership of Lynne Neagle that this committee consistently brings forward reports that not only challenge Government and hold the Government to account, but also challenge all of us to respond to these matters in a reasoned and considered way.

Will you take an intervention?

Yes.

On that point, will you therefore express some regret at the party political tone that has come today only from the benches of the Conservative Party?

Well, you haven't heard my speech yet [Laughter.]. I always fear when we try to take the politics out of politics. How we allocate our funds and what we do—[Interruption.] You are trying to be constructive, and you don't need to tweet me; I heard what you said—[Laughter.]—and I recognise the importance of the point you wish to make.

But, this afternoon, I want to address three issues in this debate. The first is the amount of money available to the education budget and to schools. All of us will make the case—and I in Government have made the case—for funds for our own portfolio areas, and I have suffered the intense pain of disagreeing with Kirsty Williams in Government as she has made the case for education funding. I pay testament to the leadership of Lynne Neagle as the Chair of the committee, but we can also do so in terms of the education Minister herself. All too often, we have these debates and we have these discussions, but I know from my experience in Government that the Minister we have today is also somebody who has argued for funding within Government and argued for that within budget in Cabinet. I give way.

Thank you very much. Of course, one of the things that we discovered in the course of our committee work is that while there is an education budget that is under the oversight of the education Minister, it's the local government end of things that has been causing the problem, and I suspect you may have something to say about that.

I do, and I will be addressing that in this speech. But the point must be made that, at the end of the day, it is the Government's budget, and the Government needs to take decisions on these matters, and these are intensely political matters, I have to say. To lead is to decide, and I say this to all Ministers in this place this afternoon: we expect a budget to be brought forward later this term that recognises the importance of education and recognises the central place of schools in what we're seeking to do. I see the chief whip is in her place, and she's been very generous to me recently, so I don't wish to abuse that generosity, but I fear I might, when I say to her that a budget that is published that does not give fair play to education and to schools is not a budget that will enjoy support from these backbenches. We need to ensure that the budget, when it is brought forward, is one that recognises the importance of a sufficiently funded education system.

The second point I wish to make is about the complexity of the system, and Suzy Davies has, in many ways, addressed this. Let me say this—during the budget discussions that took place last year, as people will remember, I was the local government Minister. I supported the additional funding being provided to education at that time, and I supported it in the form of a grant to try to ensure that this funding actually reaches the classroom and doesn't simply stop at the local county hall.

I'm grateful to the committee for demonstrating clearly that there is far too much complexity in the system, and that schools do not therefore receive the funds that we would expect them to receive. If the system were to be reformed, then there would not be any need to do these things in such a way, but my fear is that in an unreformed system, the clear priority of teaching staff, children and young people, who have the right to expect better of us, will not see the benefit, even where those difficult decisions on funding are taken.

I would ask the Minister to consider not simply the arguments over additional funding, but also what is found in this report about the complexity of the system. I would be absolutely clear in my mind that it is right and proper that we do debate and discuss hypothecation of education funding, that we ring-fence funds for schools to ensure that all local authorities are compelled to spend the funds that are voted for education through this place on education and that they reach the classroom.

I would also ask the Minister to consider funding schools through the consortia or another system of regional funding. This would cut the complexity and the bureaucracy, and increase the capacity of locally based organisations to provide an education system. But we have to ensure, again, that we address the complexity and the bureaucracy within the system. If we're unable to do this, then I fear that we will have to consider the direct funding of schools. This is not something I've ever argued for in the past, but it is now something that I believe we may need to consider if we're unable to reform the system in any other way. It is more important to me that teachers, that young people, that children in this country have the education they deserve than we sacrifice their education on the altar of our principles, and we have to take that decision. We can't simply wish money into that classroom; we have to vote it into that classroom, and then we have to vote through the changes that make that money reach that classroom. We can't say that we want to see that, making an easy, popular speech on a Wednesday afternoon, if we are not then prepared to take the tough decisions next Monday morning to make sure that funding reaches that teacher, that pupil, that student in that classroom. And so I say to people, 'Don't simply accept this report this afternoon unless you've got the courage of your convictions to make the case for that funding reaching that classroom.'

I'll conclude, Presiding Officer—I know I'm testing you again this afternoon—with the point I made at questions earlier. I have a personal commitment that I know the Minister shares to additional learning needs, and when we worked together in the education department to deliver a reformed system for additional learning needs, we also ensured that the resources were there in order to deliver that. But we also know that we need those resources ring-fenced as well, and I hope that when the budget is brought forward we will have a place for additional learning needs ring-fenced within that budget, so we don't simply reform the system, but we provide the education for children and young people with additional learning needs that they deserve, throughout the whole of this country. Thank you.

The Minister for Education, Kirsty Williams.

Thank you very much, Presiding Officer. Could I begin by thanking the committee for their report and their consideration given to this most important of areas? I'm very grateful that the committee took the decision to look at this subject, and as always, as Alun Davies says, the committee's consideration has been detailed, thoughtful and useful to me as the Minister for Education. As I have stated in my written response to the committee, the strength of the evidence provided highlights how essential it is that our schools receive the appropriate levels of funding.

The report also highlights just how hugely complex the school funding system is. That's something that I also recognise. It's multilayered and it's dependent on many factors, which make it incredibly difficult to provide a simple, single solution. I have accepted all of the committee's recommendations, and my officials have already started taking these forward, but I hear the points raised by the Chair of the committee and I'm happy to supply further written responses to the points that she has raised, because I will not have time in my contribution this afternoon to address them all.

However, we have to recognise that whilst the UK Government's spending round indicates some loosening of the purse strings, it does not provide the sustainable long-term basis on which to plan that our public services desperately need and is referenced in recommendation 15 of the committee's report. I have to say to Suzy Davies, with the greatest of respect, she quoted a figure of three years' funding that has been made available to the Department of Education. I would have loved to have been in the same position. The reality is that this Government does not know its spending allocation for more than one year. It is all very well to give that security to colleagues in England and then not provide that security to us here in Wales, and people out there need to know that. The Welsh Conservatives—

Will you take an intervention?

No, I won't. The Welsh Conservatives speak disingenuously about the level of funding Wales received via the spending round for next year. As they should know, due to issues surrounding the treatment of non-domestic rates, that has led to a reduction of £178 million to the Welsh budget, and you simply cannot compare like for like when looking at departmental budgets. Essentially, Wales's overall budget has risen, it has risen, by some 2.3 per cent in real terms next year—that is a fact that I am quite happy to acknowledge—whilst the key departments in England have seen rises of more than 3 per cent in real terms. That is the reality of the situation that we're dealing with.

I also continue to see that the Welsh Conservatives refer to an alleged £600 per pupil spending gap compared to England. They know, Presiding Officer, that they are quoting an old figure from 2011, and they know it is incorrect. They know that up-to-date figures show the gap has been virtually eliminated. It is really time, if we're to make progress on this issue, that we are honest about the situation that we all face and we stop trying to mislead people.

Members will be aware of the call yesterday, Presiding Officer, from the Welsh Youth Parliament for more emphasis on life skills, including financial education, in the curriculum. Well, after the performance this afternoon, all I can say is perhaps I could arrange an adult education class on the same subject for some of the Members in this Chamber. It might be a good start.

Presiding Officer, I'm not intending to go through each of the report’s recommendations. I have been clear in my response to the committee, and if the Chair wants further clarity, I'm happy to provide that. But I would like to provide a little more detail on the primary recommendation contained in the report, recommendation 1. We have engaged with stakeholders who called for the review as well as those who have done research into education funding. So, we have sought advice from National Education Union, from NAHT, from the Association of School and College Leaders, from Undeb Cenedlaethol Athrawon Cymru—our various union stakeholders.

The committee will be aware, as is Siân Gwenllian, of the complexities in identifying the basic cost of running a school and educating a pupil. The IFS say that average per-pupil spend in Wales is just under £6,000 per person, but spending per pupil varies. It varies across local authorities. This range reflects a combination of differences in deprivation, in sparsity, in the deployment of staff in individual institutions, of the very structure of a school system within a local education authority, as well as the choices that are made by local authorities in line with their responsibility for setting school budgets. And as a result, I would argue that there is no average Welsh school.

We need to have a clear understanding of how different schools and different authorities spend their money at present, and we need to do that to help influence future policy making. I am therefore pleased to announce this afternoon that the leading education economist, Luke Sibieta, has agreed to undertake this work independently of Government. I'm sure that Members will recognise Luke’s expertise and work in this area, including his work for the Institute for Fiscal Studies, and I will make further announcements on the terms of reference of the review and the timescales of Luke’s review in coming days.

Will you take an intervention?

Yes, of course.

Just on the review, what's the timetable for that, please? My fear is that—. It is complex, the whole area is complicated. Isn't this going to be an excuse to kick the whole discussion into the long grass, because the schools need the money as soon as possible, not 12 months down the line?

I will be guided by Luke’s expertise in this issue, and I'm sure we'd all want the work to be a comprehensive piece of work, but I would be hopeful that that work would be completed before the summer recess of 2020, and therefore is an opportunity to influence the next set of budget discussions.

In turn, I'd like to focus on recommendation 4, asking us to consider how the allocation of resources for local authorities can be determined by a needs-based approach, and what this approach should consider in relation to the education element of a local authority’s funding. I welcome that the education part of the local government distribution sub-group is already considering the potential for developing an alternative approach to the education formula within the local government settlement model. The work on the education element of the formula is essentially a pilot that will need to be tested really thoroughly before this methodology is considered for further roll-out, and I will consider how this work aligns with the work being taken forward under recommendation 1. And I'm very grateful to the Minister for Local Government and Housing for agreeing to work in partnership with me on this particular recommendation. And of course, we'll be very happy to keep colleagues updates on that work.

I recognise that to continue raising standards, our schools need support through core funding. However, as we have discussed at length this afternoon, as the local government settlement is unhypothecated, it is for local authorities to determine their priorities. And I would say to both Suzy Davies and indeed to Alun Davies: you may have a view over the direct funding of schools, but I have to say there is a different view from Labour leaders of local authorities in Wales, and indeed those in the Conservative Party who have positions of responsibility for local authorities in Wales, who feel very, very differently. Perhaps you should have conversations with them.

And, Darren, as regard to this false premise of a north versus south divide, I recently took the time and trouble to go to the distribution sub-group. I specifically asked the leaders of the councils that were represented there that afternoon whether they would undertake a review of the data and the funding formula. And I have to say, both the leader of Wrexham, which I believe is in north Wales, and the leader of Gwynedd, which I also believe is in north Wales, absolutely refused to enter into a debate about changing the funding formula.

So, if I can get back to my script, and I'm conscious of the time, Presiding Officer, I would like to recognise that I continue, within the education department, to provide significant grants above and beyond the allocations in the RSG to fund local schools, local authorities and regional education consortia. As I'm sure Members will recognise, we have a hugely ambitious reform agenda set out in our national mission action plan, and despite continued strains on our budgets, I was pleased last year to be able to announce the single biggest investment in the professional learning of the teaching profession since devolution started. And in setting teachers' pay for the first time this year in Wales, we have diverged from the proposals in England by ensuring that the starting salary for teachers starting to work in Wales is higher than it is across the border. This will help to promote teaching as a profession of choice for graduates and career changers.

To conclude, to all Members who are making the case for school funding, I say, 'Of course, I support increasing education funding', and I think my record even before I came into the Government was proof of that. But I am yet to see a genuine, thought through, comprehensive spending calculation from anyone in the opposition that demonstrates where they will cut funding to put more money into my budget. There is no proof of any opposition party here that makes school funding a priority. But, as ever, I'm very happy to discuss proposals and suggestions as they come through. And I'd like to reiterate once again that I welcome the committee's report and that I hope that there is cross-Chamber support for the recommendations that that report contains. 

The Chair, Lynne Neagle, to reply to the debate—Lynne Neagle.

Thank you, Llywydd, and can I thank all the Members who've contributed to the debate this afternoon and thank the Minister for her contributions? I will try and respond to some of the points that Members made in the debate.

Suzy Davies, obviously, you supported the premise of the report. There was a slight dispute about the amount of money that we've got coming to us in Wales. My understanding is that it is less than you said, but I have been very clear in what I've said to Welsh Government that I want to see the bulk of that going into education, and I hope that that will be the case in the forthcoming budget.

Can I thank Siân Gwenllian for her contribution, in particular the very strong focus on preventative spend? As I said in my speech, investment in education is the most important preventative investment we can make in terms of tackling child poverty and increasing life chances. It has been a regular focus of our budget scrutiny where we have consistently raised concerns, as indeed has the health committee, that there needs to be more focus on prevention. So, I very much welcome the emphasis that you've placed on that, and also—

We've heard this afternoon that the review that we have in recommendation 1 won't be completed until next summer. So, do you think that the Welsh Government needs to re-balance the budget in favour of preventative services, including education, in the next budget, without waiting for the results of the review?

Thank you, Siân. I was going to come on to say that you made the point in your speech that you didn't think the review should be a reason to wait to put more resource into education, and I absolutely agree with that, and I'm sure that the Minister also agrees with that. There is no reason to wait. The purpose of the review, which was also highlighted by Dawn Bowden, is that the committee was looking to place education on a similar footing to health, where we had the Nuffield review, which had a detailed look at the need to spend in health and has been used as the basis for budget setting. So, that would be very valuable, but I certainly don't think there is any need to wait, and we need to see that additional investment now, because we know the pressures that are in the system now. 

Can I thank Dawn Bowden for her contribution and for the role that she played in the committee helping to unpick the complexity? It is indeed incredibly complex. There is in fact a whole chapter in the report on how school funding works. I recommend it, it's a page turner. But, it is indicative of just how difficult it is to track the money. We did have a lot of discussion in the committee about austerity as well, and we've tried to come up with a report that recognises the challenges that face the Welsh Government in what comes to the Welsh Government from Westminster, but tries to target where we need to improve.

Thank you very much, Lynne. It was just a point of clarification, as much as anything, about the review. Our recommendation was about school funding—the sufficiency of school funding—not education in the round. And bearing in mind this split between local government and the education pot centrally, I think that's an important distinction that needs to be just placed on the record.

Yes, absolutely. I think that's a given—that it's about school funding, the cost of running a school, the cost of educating individual pupils and also the cost of the reforms.

Can I thank David Rowlands for his support for the committee report? David raised the issue of direct funding for schools, as did Alun Davies. As the Minister has highlighted, there are very diverse views on that. We had some evidence from unions like the Association of School and College Leaders that said that they would welcome a national funding formula for Wales, but, of course, local government were very opposed to that in the inquiry. What the committee has sought to do is to try and ensure that we have a consistent approach to funding, and that is very much our focus.

Can I thank Alun Davies for his contribution, some of which I've picked up on—also his very strong support for the need for proper funding for additional learning needs? I know that that's something that you're very committed to. That was a very strong theme in the committee's inquiry, but also in our scrutiny of the Bill when it was going through. Stakeholders were saying to us, 'This will only work if it is properly funded', so we are very clear about that.

You also called for ring-fenced funding for schools. I was a member of the school funding committee that met in 2005, some 15 years ago, and we called for there to be protection for school funding. A minimum amount of funding would be—the indicator-based assessment would be the minimum that had to be spent in our schools. That report and the report that followed it—the Bramley review—went into the 'too difficult' box. That's why I make the point that we cannot allow this forthcoming review to go into that box as well.

Can I thank the Minister for her response and for her ongoing engagement with the committee, and for the positive approach that she's taken to the committee's recommendations? I'm very pleased that Luke Sibieta has been appointed. Members will remember that he was engaged with the committee—he did a session with us—and he is a recognised expert. We will continue to follow that work with great interest and hope that it will lead to some very significant findings.

Can I just conclude by thanking everybody who gave evidence to the committee and supported us? Just to reiterate that point that I made, we are going to have to have a grown-up conversation about this across parties, across Government and across local government, because that money needs to come from somewhere. And I hope that we can prioritise our children and young people.

The proposal is to agree the motion. Does any Member object? No. The motion is therefore agreed in accordance with Standing Order 12.36.

Motion agreed in accordance with Standing Order 12.36.