Budget day: What was announced for schools and education? Funding for SEN, new teachers, RAAC crisis and more

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Billions of pounds will go towards hiring more teachers and SEN provision 💰
  • Chancellor Rachel Reeves has announced her first Budget, which has revealed significant investing in public services like state schools and the NHS.
  • A controversial move to charge private schools VAT on fees has remained on its original timeline.
  • Nearly £7 billion in capital investment has been promised to the Department for Education next year, in part to rebuild and maintain old and crumbling school buildings.
  • A big boost in funding for special education provision has also been pledged, after the system was slammed by the government’s spending watchdog.

The Labour government looks set to make many of its pre-election education promises a reality, and it isn’t shying away from giving schools the funding they need for big changes.

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In her first Budget as Chancellor, Rachel Reeves revealed on Wednesday (30 October) that she would be raising taxes by £40 billion - the biggest tax increase in a Budget in decades, according to Sky News pundits. The money would go towards plugging the “black hole” in public finances left by the Conservatives, with huge chunks set aside for important public services like education and the NHS.

The Labour Party had included an ambitious portfolio of education policies in its earlier manifesto, and it has already got to work on many of them since being elected in July. The new budget has further outlined how it intends to pay for many of them, as well as promising some significant new cash injections into particular problems that have popped up in the sector.

Here is what the Chancellor has said about schools and education in this year’s Budget announcement:

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Funding schools and education

Reeves has confirmed that private schools will indeed be charged VAT on fees, with the money going towards improving state-funded schools, a change that will kick in in just over two months time. “Ninety four per cent of children in the UK attend state schools. To provide the highest quality of support and teaching that they deserve, we will introduce VAT on private school fees from January 2025. We will shortly introduce legislation to remove their business rates relief from April 2025 too.” 

This proposed change, which has been mooted for some time, has proven controversial. Many independent schools have responded by increasing fees, effectively passing the buck to families. Military families and those with children with SEN or disabilities are among those who have pushed back against the move.

Reeves said that by making this, as well as other “difficult decisions” around taxes, the government was able to announce some immediate funding injections. In education these included increasing the core state schools budget by £2.3 billion next year, “to support our pledge to hire thousands more teachers into key subjects”. 

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Here's what has been announced for education in Chancellor Rachel Reeves' first BudgetHere's what has been announced for education in Chancellor Rachel Reeves' first Budget
Here's what has been announced for education in Chancellor Rachel Reeves' first Budget | (Image: National World/Adobe Stock/Getty)

“This government is committed to reforming special educational needs provision to improve outcomes for our most vulnerable children,” she continued. “To support that work, I am today providing a £1 billion uplift in funding - a 6% real terms increase.”

The special educational needs (SEN) system has been in the headlines last week, after the National Audit Office found it to be “unsustainable” and “not achieving value for money”, or meeting children’s and families’ expectations.

It wasn’t just state primary and secondary schools that looked set to benefit either. “So that our young people can develop the skills that they need for the future, I am providing an additional £300 million for further education,” Reeves continued.

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Child poverty and wellbeing

Among a wide-ranging host of other policies aimed at reducing the impact of the cost of living crisis on British families, Reeves unveiled a new ‘fair repayment rate’.

This will cut the debt repayments able to be taken from Universal Credit payments from 25% to 15% of their standard allowance. She said this would help with “lifting children out of poverty”, affecting about 1.2 million of the UK’s poorest households.

“I want every child to have the very best start in life, and the best possible start to the school day too… I am today tripling investment in breakfast clubs, to fund them in thousands of schools.”

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Infrastructure and school buildings

‘Rebuild Britain’ appeared to be a key catch-phrase used by the Chancellor during her announcement, and schools were no exception.

Reeves announced a whopping £6.7 billion of capital investment (a type of investment into building or maintaining public assets and infrastructure, like buildings or roads) for the Department for Education next year. This represented a 19% real-terms increase on this year’s funding.

Some £1.4 billion of it would go towards building 500 schools “in the greatest need”, funding first unveiled last week after the BBC reported that only 23 out of 500 schools included in the the School Rebuilding Programme had been completed so far. The government planned to push this up to 50 rebuilds per year.

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Schools she pledged to fund the rebuilding of included St Helen’s Primary School in Hartlepool, and Mercia Academy in Derby, alongside “so many more across our country”.

There will also be another £2.1 billion allocated to improve school maintenance, about £300 million more than this year. “[This is] ensuring that all our children can learn somewhere safe. Including dealing with RAAC-affected schools in the constituencies of my right honourable friends, for Watford, Stourbridge, Hyndburn, and beyond.”

RAAC is a type of lightweight concrete used in many public buildings during the 1950s and 60s, which has later proven prone to sudden collapse. More than 100 schools were told to close off buildings containing RAAC last year alone.

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The Chancellor said that the poor state of school buildings is the factor that drove both her and her sister to first join the Labour Party in the first place. “My school, like so many others, was rebuilt by the last Labour government… But today, after 14 years of Tory government, progress has gone backwards, schools roofs are crumbling, and millions of children are facing the very same backdrop as I did.”

Significant funding has also been put towards hiring more teachers, especially in 'key subjects'Significant funding has also been put towards hiring more teachers, especially in 'key subjects'
Significant funding has also been put towards hiring more teachers, especially in 'key subjects' | (Photo: Adobe Stock)

What has the response been so far?

Leader of the Opposition Rishi Sunak slammed the entire Labour Budget, saying it was “broken promise after broken promise”. It suggested Labour would box tax and spend more than they had initially promised, he claimed.

In terms of education spending, some announcements have been met with cautious optimism. On the increased funding for SEN provision in schools, Speech and Language UK chief executive Jane Harris said: “The Chancellor’s investment in the futures of more than a million children with special educational needs is essential. We hope this extra £1 billion will be spent wisely, recognising that children with speech and language challenges form the largest group of children with SEND in primary schools.”

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Wise spending could include urgent action to recruit more speech and language therapists in schools, she said, and more training for teachers and early years staff - so that they could intervene early, and “prevent the spiralling speech and language challenges in the most deprived areas of the country”.

“This is a promising start - we now need to see this investment mirrored in government policy on teacher training, behaviour and attendance policies and staffing ratios in early years settings,” Ms Harris continued. “We look forward to working with this government to make sure that this £1 billion real-terms increase really leads to a strong and solid foundation for 1.9 million children across the country.”

Reeves’ firm stance on sticking with the original timeline for charging private schools VAT on fees had a more mixed reception, however. Mairéad Warren de Búrca, a managing director at the Alvarez & Marsal Tax consultancy, said: “It’s disappointing that the government didn’t defer these changes to the start of the 2025 school year, allowing private schools a smoother transition. 

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“Setting aside the politics, the decision to introduce VAT for private schools feels rushed, with limited consultation or consideration of the sector’s unique challenges,” she continued. “Wealthier schools may be able to absorb the impact and even gain some advantage as a result of historical capital expenditure. However, less well-funded schools are likely to face significant administrative hurdles.”

What do you think about the Budget, and what it will mean for our children and schools? Have you say and make your voice hear by leaving a comment below.

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