EDUCATION leaders say it’s imperative the Government recognises the additional expense in educating children in sparsely populated areas before a new funding formula is introduced.

In a report on schools’ budgets - which will go before North Yorkshire County Council’s executive committee on Tuesday - the director of Children and Young People’s Services sets out the financial situation facing the county’s schools.

Under initial proposals for the new National Funding Formula (NFF), published in December 2016, a total of 55 per cent of secondary schools in North Yorkshire and ten per cent of primaries stood to receive less money.

However, in the autumn statement, the government announced an extra £1.3bn for schools, moved from other Department for Education budgets, which has improved the situation in North Yorkshire.

From 2020 the NFF will see central Government set an individual budget for every school, both local authority-maintained schools and academies. As the new funding system is bedded-in there will be a period of “soft NFF” whereby Whitehall sets notional budgets for each school and then gives an overall total for each local authority area.

During “soft NFF” local authorities can use some discretion and move some money to where they feel there is most need, but that flexibility will end in 2020.

North Yorkshire County Council’s executive member for education, Cllr Patrick Mulligan said the education authority will face a funding shortfall as the NFF does not recognise the amount of money spent on transporting children to school in rural areas.

Money allocated to children with Special Educational Needs (SEN) such as conditions on the autism spectrum, mental health issues and moderate learning disabilities will also be affected.

Half of the money the Government will allocate for educating children with high needs will be based on local levels of population and deprivation.

“They have a formula that probably meets the needs of other parts of the country better than ours. That’s an area of concern for us," he said.

“About 20 per cent of the budget is devoted to deprivation, which isn’t an issue we have in North Yorkshire. But we do have issues with sparsity and mobility; people being able to get to school. That’s not taken into account at all. So we’re finding that’s becoming more challenging and demanding.”

“We spend, I think in the region of £21m a year on home to school transport. That’s a significant amount because we have a statutory duty to transport children who live more than three miles away from school.”