Expectations of support for poorer students are being re-set

The British state is rightly focused on combating hunger. Providing a quality education for all children? Not so much.

A rare blossoming of optimism: we learned last week that our politics is still capable of welcoming a decision to feed children who would otherwise go hungry. The Labour government’s decision to extend free school meals to all children whose families claim Universal Credit has rightly drawn almost universal approval.

As always, however, the devil is in the detail. In extending the most basic provision to vulnerable children, the government has also signalled the limits to what poor children can expect from the schooling system for the foreseeable future.

Eligibility questions

Based on official figures, around 2.2 million school-age children, 26% of the total, were eligible for free school meals last year. Both figures correspond closely to the government’s estimates of children in ‘absolute low income’ based on its Family Resources Survey. And both figures have also risen in recent years—which says a great deal about the level of poverty in Britain today, given how regressive a measure this has become.

Free school meals eligibility has been subject to a sort of ‘reverse fiscal drag’, in which more and more children failed to qualify based solely on the effects of inflation on household income. The key qualification for eligibility—a household income of just £7,400 or less, excluding benefit payments—will have remained frozen in cash terms for eight years by the time the new policy takes effect in 2026-27. That figure would have to rise to £9,620 today, or around £10,000 by the time the change in policy takes effect, to keep up with price increases, using the Bank of England’s own inflation calculator.

Estimating how many children lost out because of the decision to freeze FSM eligibility in cash terms is complicated. The government does not publish, or seemingly hold, data in a form that makes this calculation straightforward—something that sounds more Orwellian than is likely to be the case.

Analysis by the Liberal Democrats during the last Parliament suggested that an additional 110,000 children would have qualified for free school meals in 2022, if the eligibility threshold had been adjusted in-line with inflation. The government appears to endorse that figure. Education Secretary Bridget Phillipson last week said the change in eligibility would lift 100,000 children out of poverty, generating an average saving per family of £500. Accepting the figure as reasonable, the ‘like-for-like’ population of children eligible for free school meals at 2018 levels of household purchasing power would rise to around 2.3 million, or 27% of all children.

(Much higher estimates are also possible. The Covid Social Mobility and Opportunities Study found that almost 60% of households in which children went hungry and almost 40% using food banks did not meet the FSM eligibility test. And Child Poverty Action Group found an additional 900,000 children in poverty but unable to claim free school meals. Rightly or wrongly, however, these measures have never been the basis for funding decisions related to schools.)

The government’s new policy will weaken the effects of reverse fiscal drag by substituting a new means test (UC eligibility) which is less arbitrary. On the other hand, UC eligibility can also be complex, precisely because it is more sensitive to personal and family circumstances. And UC eligibility will not trigger FSM eligibility automatically; parents will still have to apply.

Nonetheless, there will be fewer hungry children, and less stigma associated with subsidised food in our schools. These are not small achievements.

What happens to the pupil premium?

However, that is not the end of the story. Whether or not a young person is, or ever was, eligible for free school meals has wide-ranging implications for their education. Merely the most immediate is their corresponding eligibility for pupil premium funding.

Since its introduction in 2011, the pupil premium grant has been the main funding stream used by state schools to combat the effects of poverty on children’s education. The grant was intended to enable schools to provide poor children with access to resources that were readily available in more affluent homes. Schools are required to explain in detail how the money is spent.

Based on the government’s own analysis, therefore, state schools in England have missed out on funds needed properly to support around 100,000 pupils. How significant is that loss? The pupil premium is paid at different rates in the primary and secondary phases and to different groups of pupils based on other characteristics, such as whether they are in the care of a Local Authority or the child of someone in the armed services. A reasonable weighted average across these groups is around £1,275 per pupil.

Before we multiply £1,275 by 100,000, however, we need to adjust for the impact of inflation and population growth on the pupil premium itself. These are material. The Parliamentary Committee on Public Accounts estimates that the value of the grant fell by around 9% per pupil in real terms over the period under examination (despite having risen in nominal terms by around £800 million). Restoring the pupil premium to its 2018 levels in real terms would cost around another £200 million. Extending the premium to eliminate the effects of negative fiscal drag on free school meal eligibility would cost around an additional £139 million.

In total then, almost £340 million in additional school funding would have been needed to support students who are today coping with the effects of household poverty broadly equivalent to their peers did in 2018.

For an average English secondary school, with just over 1,000 pupils, 27% of whom are/should be eligible for free school meals, that represents a budgetary ‘black hole’—to coin a phrase—of around £140,000. In practice, of course, the eligible population of children is geographically concentrated, meaning that for some schools the budgetary ‘loss’ will be much small and for some much, much greater. As ever, the poorest communities have suffered most.

In practice, the picture is worse than the above analysis would suggest. As The Sutton Trust revealed earlier this year, schools have frantically used the pupil premium grant as funding Polyfilla, temporarily repairing holes in provision left behind by a steady decline in core funding and the rising cost of teachers’ employment. Since the grant is based on the number of eligible students but is not specifically ring-fenced, this is a perfectly legitimate, if not inevitable use of the funds in the current climate.

And we should not forget that the pupil premium itself stops at age 16, despite the school leaving age having been raised to 18 a decade ago. Our school funding mechanism remains based on the hypocrisy that no additional provision is required to support adolescents from under-resourced homes past the age of 16.

Where the line is being drawn

Neither the downward slide of eligibility nor its abrupt cessation at 16 will change because of the government’s new policy. Instead, eligibility for the pupil premium will remain pegged to households with an income of £7,400.

A line is being drawn. The inevitable conclusion is that the state can and should urgently address child hunger—which should benefit academic focus, self-esteem, motivation, in-school behaviour, and relationships—but it cannot materially supplement or enhance poor children’s education in the form of additional learning resources, cultural trips, counselling provision, smaller classes, or more experienced teachers. Schooling will become less tragic, but also less joyless. This is the new normal to which schools are slowly adjusting. The implications for student achievement can be predicted, but are, strictly speaking, unknown. Expect ongoing controversy over the two child benefit cap to consume any political attention that might otherwise be focused on this issue.

Chancellor Rachel Reeves is this week expected to offer some degree of protection for ‘core’ school funding in a spending review that will otherwise very heavily favour defence and health. As we have known since March, other services on which children and families depend will not be so lucky. Some voters will conclude this is a reasonable accommodation to an impossible situation. There are likely no good choices here. Schools should welcome such protection as is available. But we should also recognise that we are witnessing a significant foreshortening of ambition for poor children.