Guidance

Schools national funding formula summary policy document for 2027 to 2028

Published 2 October 2026

Applies to England

This document outlines key elements of the mainstream schools national funding formula (NFF) for 2027 to 2028. Its purpose is to support planning by local authorities, schools, and academy trusts, before the schools NFF allocations for 2027 to 2028 are published later in autumn 2026.

Ahead of publication of the schools operational guide in autumn 2026, this document also sets out some additional guidance related to disapplication requests for 2027 to 2028.

This note does not cover the outcomes of consultation exercises that are relevant to this area of policy. Responses to those will be published separately.

The structure of the schools NFF for 2027 to 2028

The schools NFF for 2027 to 2028 will use the same factors that were used in the 2026 to 2027 NFF.

The core formula factors are:

• pupil-led factors: basic entitlement, deprivation (free school meals ever6 (FSM6)^{[footnote 1]} and income deprivation affecting children index 2019 (IDACI))^{[footnote 2]}, low prior attainment, English as an additional language and mobility
• school led factors: lump sum, sparsity and premises factors (rates, private finance initiative (PFI)^{[footnote 3]}, split sites and exceptional premises).

The area cost adjustment (ACA) in the schools NFF will continue to provide an uplift to the allocations for some local authorities to reflect variations in labour market costs across the country.

We will also continue to provide funding protection in 2027 to 2028 through the operation of a minimum per-pupil level (MPPL) and the funding floor.

These factors will operate in the same way in the NFF for 2027 to 2028 as they did in 2026 to 2027, though the factor values will be updated. More detailed information on the different factors can be found in annex A of the 2026 to 2027 policy document.

In addition to the schools NFF factors, we will also continue to provide growth and falling rolls funding to local authorities.

The factor values assigned to each factor for 2027 to 2028 will be confirmed alongside the publication of the schools NFF allocations later in autumn 2026.

Funding adjustments in respect of the schools budget support grant 2026 (SBSG 26) and teachers’ pension contributions

Rolling the SBSG 26 into the 2027 to 2028 schools NFF

The SBSG 26 is providing additional funding in 2026 to 2027 to support schools with their overall costs, including teacher and support staff pay awards.

The mainstream schools’ element of the SBSG 26 is being rolled into the schools NFF for 2027 to 2028, ensuring that this funding continues to form part of schools’ core budgets going forward.

Information on how this funding will be rolled in to the schools NFF in 2027 to 2028 is available in the schools budget support grant 2026: methodology document.

Teachers’ pension employer contributions funding adjustment

From April 2027, employer contribution rates for the teachers’ pension scheme (TPS) will decrease from 28.6% to 17.6%. This change will not reduce the value of the defined benefit teachers’ pension for current or retired teachers. The TPS is a defined benefit scheme, which means that the pensions teachers receive depend on their salary as well as the number of years they have been working for.

Funding for schools will be reduced to reflect the decrease to employer contribution rates for the TPS from April 2027. The funding reduction will reflect the decreased cost at a national level. The spending power of the schools sector as a whole will therefore not decrease.

Further information on this funding adjustment, and how it will be reflected in the schools NFF in 2027 to 2028 is available in the teachers’ pension employer contributions funding adjustment: methodology document.

Local authority funding formulae in 2027 to 2028

Local authorities will continue to be responsible for deciding local funding formulae for mainstream schools in their area for 2027 to 2028. The funding levels that schools, both maintained schools and academies, receive will be determined by the respective local formulae.

Local authorities must continue to move their local formula factor values at least a further 10% closer to the corresponding NFF values (the comparison is made after the latter is adjusted by the ACA), except where local formulae are already ‘mirroring’ the NFF. These criteria do not apply to rates, PFI or exceptional circumstances factors.

As in previous years, local factor values within 2.5% of the respective NFF values will be taken as ‘mirroring’ the NFF. This means that local authorities with factor values within +/- 2.5% of the NFF values in 2026 to 2027 can set their 2027 to 2028 factor values anywhere within +/- 2.5% of the 2027 to 2028 NFF values. Additionally, no local authority will be required to adjust their factor values closer than +/- 2.5% of the 2027 to 2028 NFF due to the 10% tightening requirement.

As part of the tightening requirements, local authorities are not allowed to ‘overshoot’ the NFF value by more than the 2.5% mirroring threshold. As such, a local authority which had a local factor value below the NFF value in 2026 to 2027 should increase the local factor value in 2027 to 2028 to get closer to the NFF, but it cannot set the factor value more than 2.5% above the NFF value. Conversely, a local authority which had a local factor value above the NFF value in 2026 to 2027 cannot set that factor value more than 2.5% below the 2027 to 2028 NFF value.

For 2027 to 2028, there are 16 funding factors, most of which are mandatory for all local authorities. These mandatory factors remain unchanged from 2026 to 2027. The specific factor value requirements for each local authority in the local funding formulae will be confirmed when the NFF allocations are published.

Mandatory factors

• Basic entitlement
• Free school meals (FSM)
• FSM6
• IDACI
• Minimum level of per-pupil funding
• Low prior attainment
• English as an additional language
• Pupil mobility
• Sparsity
• Lump sum
• London fringe (for the eligible authorities)
• Split sites
• Minimum funding guarantee (MFG)

Optional factors

• Rates
• PFI contracts, with Department for Education (DfE) agreement
• Exceptional circumstances, with DfE agreement

Funding implications of the expansion to free school meals

From the start of the 2026 to 2027 academic year, FSM eligibility was extended to all children in households receiving Universal Credit.

Due to the lag in data used to calculate the 2027 to 2028 NFF, the funding allocated to local authorities through the schools NFF will not take into account the FSM expansion. As a result, local authorities will receive additional funding through their dedicated schools grant (DSG) schools block allocations, when that is issued in December 2026. This will reflect the increase in FSM-eligible pupils that they will have to fund through their local mainstream schools formula.

Timeline

We plan to publish the schools NFF and supporting documentation (including operational guidance) as soon as possible in autumn 2026. We expect that the consequent DSG allocations will be published in December 2026 as in previous years.

The authority proforma tool (APT) will be released for local authority submissions in mid-December 2026 with a deadline return date towards the end of January 2027. This is like previous years. The APT will again be populated from schools block data, primarily drawn from the autumn 2026 school census.

Disapplication requests

The Secretary of State for Education requires a local authority to submit a disapplication request to DfE where its local approach to school funding would not ordinarily be allowable within the Schools and Early Years Finance Regulations and DSG conditions of grant.

Where such situations arise, the disapplication request service provides local authorities with a process for submitting an exceptional request to the Secretary of State for Education to disregard aspects of the respective regulations and DSG conditions of grant. 

Wherever possible, schools forum meetings should be arranged so that requests have been considered prior to the disapplication deadline of Monday 16 November 2026.

Transfer between blocks 

Local authorities can transfer up to and including 0.5% of the schools block into another block, with schools forum approval. For a transfer exceeding 0.5%, or without schools forum approval, a disapplication request must be submitted to the Secretary of State for Education.  

If the local authority wishes to make a transfer out of the schools block in 2027 to 2028 they should consult their local maintained schools and academies, and schools forum should take these views into account before making its decision. It is important that the consultation sets out the full amount of the proposed transfer for 2027 to 2028. For example, if they want to transfer 1%, the consultation documents must clearly state this. Schools forum discussions should include appropriate representation from special schools and other specialist providers. 

Local authorities have the option to request a disapplication of the MPPLs funding requirement as part of the block transfer process (to note that the MFG protection would remain in place). This provision is intended to offer flexibility in circumstances where a proposed block transfer, typically from the schools block to the high needs block, would result in a disproportionate financial impact on certain schools within the local authority’s area.

Disapplications should show the impact of the block transfer on schools’ budgets in the scenario where MPPLs are disapplied compared against the scenario where they are not disapplied. 

Disapplications must be submitted by the local authority using the digital form, in cases where:  

• the local authority wishes to transfer more than 0.5% of the schools block in total

• schools forum has turned down a proposal to transfer any amount of funding out of the schools block, but the local authority wishes to proceed with the transfer

There may be exceptional situations where a local authority has previously submitted a request and needs to amend this request, where circumstances change significantly. In these situations, the local authority should contact us as soon as possible. Any resulting changes to the transfer request would need to be submitted by 8 January 2027 at the latest.  

In such circumstances, the local authority should also have considered how they will manage the timetable for setting their school budgets so that the notifications to schools of their budget shares, and our parallel process for notification of academy allocations, are not delayed. We suggest appropriate timetabling of schools forum meetings to discuss budgets and to agree the process should any amendments to disapplications need to be made. This allows for schools forum to be informed and vote on proposed changes. Further to this, arrangements for political approval should be timetabled to take account of this later date for amended requests.  

When submitting disapplication requests for transfers from the schools block, the local authority should provide the evidence detailed in the digital form provided by us. The information required has changed and will now include the following: 

• an explanation of how the block transfer fits in with the ‘Local special educational needs and disabilities (SEND) reform plan’ - if the block transfer is not yet included in the plan because it is a new development, the local authority will need to provide an explanation of when and how it will be added to the plan

• information presented to all schools through consultation and to the schools forum, and details of responses to the transfer proposal, including papers for and minutes of schools forum meetings, showing details of the vote

Each request will be considered on a case-by-case basis. To support requests, the local authority should provide detail on the level of support from local schools and the schools forum for this plan, and if they do not support the plan, the specific arguments for the request.  

To note, for the first time in 2027 to 2028, there is an opportunity for local authorities to provide upfront SEND funding to mainstream schools by transferring funding from the high needs budget to the schools budget using the ‘local SEND inclusion factor’. In general, we do not expect local authorities using the local SEND inclusion factor to also propose a transfer of money from their schools block to the high needs block. However, we will consider cases where there would be local support for a transfer in both directions for different purposes.

General (schools and central school services) 

General disapplications are used where a local authority wishes to depart from schools funding regulations or conditions of grant because local circumstances cannot be adequately addressed through the standard funding arrangements. Requests may relate to exceptional cost pressures, variations in pupil numbers, technical adjustments to local funding arrangements, or other specific circumstances requiring regulatory flexibility. As part of the request, local authorities should explain the rationale for the proposal, alternative options considered and the likely impact on affected schools.  

High needs 

High needs disapplications are used where a local authority wishes to depart from certain high needs funding arrangements set out in the funding regulations or conditions of grant. The request should explain:

• why the proposed approach is necessary
• how it supports the provision of services for children and young people with SEND
• the impact on affected institutions and pupils

Local authorities should refer to the current high needs funding operational guide when preparing their submission.  

Early years: pass-through only 

Local authorities may submit a disapplication request where they wish to use a pass-through rate lower than the level required by the early years funding regulations. As part of the request, local authorities will be asked to identify the relevant entitlement funding stream, explain the implications for provider funding rates, and calculate the proposed pass-through percentage using the calculator provided within the form.  

Early years: all other requests 

This category covers all early years disapplications that do not relate to pass-through requirements. Requests should clearly explain the regulatory requirement being disapplied, the reason for the proposed approach, the impact on providers and children, and any consultation or engagement undertaken. Local authorities should refer to the current early years entitlements: local authority funding operational guide when preparing their submission.  

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1. FSM6 refers to pupils who are, or have been, recorded as eligible for free school meals at any point in the last 6 years. ↩

2. IDACI – an area based index measuring the relative deprivation of lower-layer super output areas (LSOAs) ↩

3. PFI factor funding is provided in respect of some schools subject to PFI contracts. ↩