19 October 2018updated 08 Sep 2021 3:44pm

To invest in colleges is to invest in the next generation

Spending on education is falling, and the ramifications are being felt now, and will be felt for many years if it is not increased.

By Julian Gravatt

The Department for Education was reprimanded earlier this month by the Statistics‎ regulator for making incorrect claims about spending on schools. In true “Thick of It” style, the schools minister claimed on the Today programme that spending was on record levels, but was found out later by an eagle-eyed BBC journalist, Sean Coughlan. The figures used by the DFE included student loans and private school fees so were hardly an accurate picture of state school spending. Following the intervention by the statistics regulator, the DfE’s permanent secretary has apologised and promised to do better.

This story is already old news but has probably left some of us with a sense of scepticism about official data. However, it’s important that we don’t miss what the spending numbers are telling us because there’s an important point about two different‎ measurements of education spending that have some telling messages about our society. The two measurements are public spending on education as a share of the economy (GDP) and total education spending as a proportion of the same figure.

Public spending on education as a share of GDP is 4.3 per cent and falling‎. In the first decade of this century, the government routinely spent 5 per cent of GDP on education. In the third decade (the 2020s), the figure will be less than 4 per cent. These are official figures from the Office of Budget Responsibility. They reflect macro Treasury decisions made in successive spending reviews. The decision to increase fees and use student loans to fund higher education resulted in a one-off reduction in public spending. Likewise, the apprenticeship levy replaced taxation in funding training and secured further spending cuts. But this isn’t the full story. These big decisions have worked their way through the budgets yet public spending on education continues to fall. We have more pupils in schools, a growing population and significant skills shortages yet education spending as a share of GDP keeps going down. So what’s going on? It is, of course, a sign that austerity continues for now. The spending squeeze started in 2015 continues until 2020.

DfE’s PR exaggeration about schools was doubly idiotic because it removed the one line of defence they had. They will now find it hard to explain how they have protected the core schools budget. In consecutive summers, Justine Greening and then Damian Hinds have allocated extra funds to schools. The core schools budget (covering age 5 to 16) is rising and some schools will get increases of more than 5 per cent this year. The department is taking another step towards a national funding formula which will help schools in lower funded areas while minimising losses elsewhere. It’s not exactly a generous settlement but it could have been defended by ministers without resorting to exaggeration.

What they find much ‎harder to defend are the spending decisions on post-16 education. The way in which the Treasury and DfE reconcile school protection and falling education spending has been by squeezing everything else. The money paid drops an average of 24 per cent when a young person reaches 16. The rates paid to school and college sixth forms haven’t risen at all for five years despite inflation. There’s a further 17 per cent cut at age 18 which hits those in disadvantaged areas playing catch-up. And England’s adult education service has been sliced in half in recent years. This, then, is the story about the education spending figures, not the messed up communications. And if it isn’t put right for the 2020s, we will as a country face difficult challenges with one hand tied behind our backs. Brexit, the next recession, automation and competition will – like it or not – bring change, job losses and a demand for retraining. The cutbacks to adult education will make it harder to offer hope to those affected and to turn around communities.

If you ask people whether spending on colleges should have been cut so dramatically, they will say “no”, but perhaps dutifully. They may feel there are bigger things to worry about: healthcare, welfare, jobs and pay, the housing shortage, their falling purchasing power. If they are in business, their worries will include skills shortages and the impact on productivity.

If, however, you instead ask people whether we should have dramatically cut investment, not in colleges, but in their children and their families and their communities, you get much more than a short, dutiful no. You find yourself listening to real anxiety and anger, and perhaps (from generations so much better invested in) some understandable guilt too. You have, of course, just asked them the same question but in a different way. Investment in our collective future starts with investment in individuals, especially the next generations, who must improve society and drive the economy through the knowledge and skills they acquire. The knowledge and the skills are acquired in colleges. Independent, impartial analysis confirms, unequivocally, that colleges are suffering from chronic long-term underfunding. If we love our country, we’ll love our colleges.