SCHOOLS are urging the Government to rethink their approach to funding, or education in the North-East will suffer under new so-called ‘fairer’ arrangements.

Plans for a new formula that will replace legacy funding were announced by Chancellor George Osborne in his Autumn Statement.

Schools North-East, the representative body for all 1,250 schools in the region, welcomed the move to a national funding formula, but raised concerns that the planned approach will not get money into schools that need it the most.

Under new proposals, the Government intends to pay schools per pupil based on 11 different factors such as low prior attainment, deprivation and sparsity.

But, it then intends to add a multiplier effect – an area cost adjustment – to give more money to schools in high cost areas so they can pay teachers more.

The Department for Education’s (DfE) consultation on the plans explained: “We believe the national funding formula should use an area cost adjustment to reflect variation in labour market costs, given the significance of such costs to school spending.”

The extra funding would enable schools in more affluent areas such as the South-East to pay their staff a wage in line with the local economy.

However Schools North-East is urging the Government to remove the area cost adjustment, saying that it could encourage migration of teaching talent to areas with greater funding, in the midst of an already worrying recruitment crisis.

Schools North-East director Mike Parker said: “The new formula was introduced to iron out historic inequality in funding.

“Ironically, the Government risks fuelling the North-South divide in education by proposing to fund schools with similar characteristics differently, based on their location.

“This means that our region will be losing funds to the South, where most high cost areas are located.

“The rationale behind this is flawed.”

Mr Parker said that inflating the budgets of schools in affluent areas so they can pay more for teaching staff will potentially drain talent from the regions that currently lag behind national attainment levels.

He added that the North-East is already at a ‘considerable disadvantage’ under the current funding system, with data showing that schools in the region get £45 million less than the national average.

“The Government needs to reconsider its approach to the new funding arrangements and ensure that payments to schools are indeed fairer,” said Mr Parker.

A Department for Education spokesperson said: “We are making funding fairer, consulting on proposals for a new national funding formula so that areas with the highest need attract the most funding. It would be inappropriate to comment on specific consultation responses while they are still under consideration.”