State schools in England are funded through a National Funding Formula (NFF) — a government calculation based mainly on pupil numbers, disadvantage, and geography. Schools receive this funding via the local authority or directly from the DfE and decide how to spend it within legal guidelines.
What is the National Funding Formula?
Before 2018–19, school funding in England was calculated differently in every local authority, which meant two schools with identical pupil populations could receive significantly different amounts depending on where they happened to be. The National Funding Formula (NFF), introduced in 2018–19, replaced this patchwork with a single national calculation.
The NFF calculates funding for each school using a combination of factors:
| Factor | What it represents |
|---|---|
| Basic per-pupil unit | A set amount for every pupil on roll (slightly higher for secondary than primary) |
| Deprivation | Extra funding for pupils who are eligible for free school meals (FSM) or who live in deprived areas |
| Prior low attainment | Extra funding for pupils who entered school with lower-than-expected levels of knowledge or skill |
| English as an additional language (EAL) | Extra funding in the first three years after a pupil joins with little English |
| Mobility | Extra funding for schools with high pupil turnover |
| Sparsity | Extra funding for very small rural schools where economies of scale are not available |
| Split-site allowance | Extra funding for schools operating across more than one building |
| Rates and premises factors | Adjustments for high-cost areas, particularly London and the South East |
| Lump sum | A fixed amount every school receives regardless of size |
The DfE publishes each school's NFF allocation on its website. Parents can look up their child's school.
How does money actually reach the school?
For maintained schools, funding flows from the DfE to the local authority, which then allocates it to individual schools. The local authority operates its own Local Funding Formula (LFF), which must closely mirror the NFF but can include some local adjustments within tightly set limits.
For academy schools and free schools, funding is paid directly from the DfE to the academy trust, bypassing the local authority. This is one reason why the funding figures for academies and maintained schools can differ slightly — academies receive some elements directly that maintained schools receive through the local authority.
What extra grants do schools receive on top of the NFF?
The NFF is the core, but schools receive several other grants:
Pupil Premium — additional funding for disadvantaged pupils (those who have been eligible for free school meals in the past six years, children of armed forces personnel, and looked-after or previously looked-after children). The rates are updated each April. Schools must publish an annual Pupil Premium strategy statement showing how they are spending this money and measuring its impact.
SEND High Needs Funding — for pupils with significant special educational needs and disabilities, local authorities hold a High Needs block from which they fund support for pupils with EHCPs and for specialist provision. A school with many pupils with EHCPs will draw on this funding for the support specified in each plan.
Capital funding — separate from the revenue budget (day-to-day spending) is capital funding, used for buildings, major equipment, and refurbishments. This comes through separate government programmes such as the Condition Improvement Fund.
Catch-up and targeted grants — the government periodically makes additional grants for specific priorities: the Recovery Premium post-COVID, the School Breakfast Programme, and mental health support grants are recent examples.
How do schools spend their budget?
Schools have considerable freedom in how they allocate their budget, within statutory obligations. A typical secondary school spends roughly:
- 70–75% on staff costs (teachers, teaching assistants, pastoral and support staff)
- 10–15% on premises, energy, and maintenance
- 5–10% on learning resources, ICT, and curriculum materials
- 5% on other running costs (catering, transport, administration)
The headteacher and governing body are responsible for setting and approving the annual budget plan. Ofsted does not directly audit school finances, but the Education and Skills Funding Agency (ESFA) monitors financial management and can intervene where a school is in deficit or where financial management is inadequate.
Can parents see a school's budget?
Yes. Maintained schools must publish their budget and financial benchmarking data online. The DfE's schools financial benchmarking tool at the DfE website allows anyone to look up any state school's income and expenditure and compare it to similar schools. Academy trusts must also publish audited accounts annually. These are public documents — you do not need to make a formal request to see them.
What happens if a school runs a deficit?
A school that spends more than it receives will run a deficit budget. Local authorities and the ESFA monitor this. A school that cannot balance its budget within a reasonable period may have an Education Recovery Director or other government representative placed on its governing body to oversee a recovery plan. In extreme cases, the school may be required to join a multi-academy trust (MAT) or be rebrokered to a different trust.
Frequently asked questions
How much does a secondary school receive per pupil?
The exact amount varies by school because the NFF is school-specific, but a typical English secondary school in 2024–25 might receive between approximately £6,000 and £8,000 per pupil per year in core NFF funding, before Pupil Premium and other grants are added. Schools in London and areas with high deprivation or high needs populations receive more. The schools financial benchmarking tool on the gov.uk website shows each school's actual figures.
Does a private school receive any state funding?
Most private (independent) schools receive no direct state funding for their general operation. However, some private schools that admit state-funded pupils through local authority arrangements (for example, for pupils with EHCPs that specify the independent school) may receive funding for those specific pupils via the High Needs block. State boarding schools — a small number of schools run by local authorities or as academies that charge fees for boarding but not for tuition — receive per-pupil funding for the educational element.
Why do some schools seem to have more resources than others if there is a national formula?
Several factors create variation: the historic building stock (some schools inherited new facilities, others have ageing premises requiring constant maintenance), the level of disadvantage in the pupil population (which attracts more Pupil Premium), historic staffing costs (experienced staff are more expensive), the local cost of living (which affects salary needs and premises costs), and how effectively each school manages its budget. Two schools with the same NFF allocation can end up with very different classroom resources depending on their cost base.
Does the amount a school receives affect its Ofsted rating?
Ofsted is explicitly required to inspect schools on the same basis regardless of their budget or socioeconomic context. In practice, well-funded schools with lower-needs pupil populations tend to find it easier to score highly — but Ofsted inspectors use value-added measures and assess the school's effectiveness relative to its context, not against an absolute standard.
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