Guidance

Academies funding: A to Z of terms

A guide to the main academy funding terms and acronyms.

Our series of short training videos and guide to schools revenue funding explain academies funding in more detail.

Further information about academies funding allocations for the 2016 to 2017 academic year is available in the funding allocation pack.

A

Age weighted pupil unit (AWPU)

AWPU is the rate local authorities set to allocate basic entitlement funding for all pupils in the funding formula for pre-16 pupils in mainstream schools. It is a compulsory factor which must be used in the funding formula.

For the 2016 to 2017 academic year there must be a single rate of at least £2,000 for primary age pupils. The rate for secondary age pupils is at least £3,000 and local authorities can set different rates for key stage 3 and key stage 4 pupils. More information is available in schools revenue funding 2016 to 2017 operational guide.

Alternative provision (AP)

Alternative provision (AP) academies teach children who are not able to attend a mainstream school. This could be because they have behavioural difficulties, a short- or long-term illness, have been excluded or are a new starter waiting for a mainstream school place.

In the 2016 to 2017 academic year AP academies are allocated funding for every place at a rate of £10,000. Local authorities may pay top-up funding directly to schools and academies to meet extra costs related to the additional educational needs of individual pupils.

The 2016 to 2017 funding allocation pack includes more information about AP funding. More information on AP is also available in the guide to converting to an AP academy and high needs funding arrangements 2016 to 2017.

Alternative provision: free school funding

AP places in free schools will be funded from a central departmental budget for the first and second year the free school is open. From the third year the cost of the place funding will be met mainly by deductions from the relevant local authorities’ dedicated schools grant (DSG), so that the AP they offer is fully integrated into local planning and funding arrangements. More information is available in schools revenue funding 2016 to 2017 operational guide.

Authority proforma tool (APT)

The authority proforma tool is the spreadsheet local authorities use to submit their agreed mainstream pre-16 schools block funding formula to EFA.

EFA applies the factors and rates in each authority’s formula to academies’ pupil numbers to calculate their schools block allocation. More information is available in schools revenue funding 2016 to 2017 operational guide.

B

Basic entitlement or Basic per pupil entitlement (BPPE)

Also known as AWPU - see AWPU.

D

Dedicated schools grant (DSG)

The grant is paid in support of local authorities’ schools budget. It is the main source of income for the schools budget. Local authorities are responsible for determining the split of the grant between central expenditure and the individual schools budget (ISB) in conjunction with their schools forums.

It is divided into three blocks: the schools block, the high needs block and the early years block. For the schools block, local authorities are responsible for allocating the ISB to individual schools in accordance with the mainstream pre-16 local schools’ funding formula. Academies’ funding for the 2016 to 2017 academic year is based on their local authority’s 2016 to 2017 financial year funding formula.

More information is available in dedicated schools grant (DSG): 2016 to 2017.

Deprivation

Deprivation is a compulsory funding factor in local authorities’ mainstream pre-16 schools block funding formula that directs funding to the most deprived pupils. Local authorities can choose to use free school meals (FSM) data and/or the income deprivation affecting children index (IDACI). More information is available in schools revenue funding 2016 to 2017 operational guide.

E

Early years block

The dedicated schools grant (DSG) is divided into three blocks: the schools block, the high needs block and the early years block. The early years block covers the free entitlement for 3 and 4 year olds, and disadvantaged 2 year olds.

Early years funding

This applies to private, voluntary and independent providers and to schools or academies with a nursery class. This is paid directly by local authorities to all early years providers, including academies and maintained schools, through the early years single funding formula (EYSFF). More information about early years funding is available.

Early years pupil premium (EYPP)

This is additional funding for early years settings to improve the education they provide for disadvantaged 3 and 4 year-olds. Guidance for local authorities is available.

Early years single funding formula (EYSFF)

The route by which local authorities fund early years providers. This is made up of a base rate for each type of provider plus supplements (local funding factors).

Education services grant (ESG)

This is per pupil funding paid to academies for services that for maintained schools are provided by their local authority, for example school improvement and asset management. For academic year 2016 to 2017 the rate is £77 per pupil. The rate differs for alternative provision (AP) settings and special academies. For academic year 2016 to 2017 the rates for AP academies and special academies are £288.75 and £327.25 per place respectively.

Local authorities receive ESG for their maintained school pupils. They also receive ESG retained duties funding to meet their responsibilities for both maintained schools and academies. For 2016 to 2017 academic year this is paid at a rate of £15 per pupil.

We have provided academies with a protection to limit reductions to their budgets in 2016 to 2017 as a result of the changes to ESG. Each academy will have its own level of protection based upon its level of ESG per pupil received in academic year 2015 to 2016, and will lose no more than 3% of their total funding. More information is available in education services grant: 2016 to 2017.

We will be removing the ESG general funding rate from academic year 2017 to 2018, as announced in the first stage of our consultation on introducing a schools national funding formula. The ESG retained duties will be moved into the dedicated schools grant (DSG) and paid to local authorities on a per pupil rate.

Element 3

Another term for high needs top-up funding - see high needs top-up funding.

English as an additional language (EAL)

This is an optional funding factor in local authorities’ mainstream pre-16 schools block funding formula. EAL pupils may attract funding for up to 3 years after they enter the statutory school system. More information is available in schools revenue funding 2016 to 2017 operational guide.

Exceptional premises factors

Local authorities can apply to EFA to use exceptional factors relating to premises in their mainstream pre-16 schools block funding formula. The exceptional factors most frequently approved by EFA are for rents and for joint-use sports facilities. More information is available in schools revenue funding 2016 to 2017 operational guide.

F

Free school meals (FSM)

Arrangements by which children from low income households are provided with a free meal while they are at school. Arrangements vary locally.

From September 2014, free school meals have been extended to all pupils in reception to year 2, under the universal infant free school meals (UIFSM) programme.

Local authorities can use the number of pupils eligible for a free school meal in a school as an indicator for the deprivation factor in their mainstream pre-16 schools block funding formula (see deprivation). Pupils who are eligible for a free school meal under the UIFSM programme due to age do not automatically attract deprivation funding. Eligible pupils must be registered for a free school meal for their school to attract this funding.

Pupils eligible for a free school meal at any point in the previous six years also forms the basis of funding schools receive for the deprivation pupil premium. More information is available in schools revenue funding 2016 to 2017 operational guide.

Funding allocation pack (FAP)

This is the term used for the general annual grant statement detailing academies’ revenue funding. Funding allocation pack guidance for 2016 to 2017 is available.

Funding factors

Local authorities can use up to 13 funding factors to form their mainstream pre-16 schools block funding formula. Two factors (basic entitlement and deprivation) are compulsory. More information is available in schools revenue funding 2016 to 2017 operational guide.

G

General annual grant (GAG)

Revenue funding for academies. Academies are expected to meet their day to day running costs from the GAG.

H

High needs block

The dedicated schools grant (DSG) is divided into three blocks: the schools block, the high needs block and the early years block. The high needs block covers place funding for special schools/academies and units, top-up funding for high needs pupils, alternative provision and education otherwise than at school, and funding for local authority central SEN services. More information is available in dedicated schools grant: conditions of grant 2016 to 2017.

High needs place funding

This applies to mainstream schools and academies with a designated special unit or resourced provision, plus mainstream special schools and special academies. £10,000 place funding is provided for each agreed pre-16 high needs place. This is paid directly to academies by the EFA and forms part of the budget share for maintained schools. Post-16 high needs places in special units, resourced provision or sixth forms are funded through the national post-16 formula. More information is available in schools revenue funding 2016 to 2017 operational guide and high needs funding arrangements 2016 to 2017.

High needs top-up funding

For pre-16 pupils, this is paid directly by the commissioning local authority for high needs pupils where the total cost exceeds the following thresholds. In the case of special units, the cost threshold is £10,000 and includes the costs of all pupils’ basic educational entitlement, which is funded through the place funding. If the pupil is not in a unit, the cost threshold is £6,000, which only covers the costs of additional SEN support. More information is available in schools revenue funding 2016 to 2017 operational guide and high needs funding arrangements 2016 to 2017 guidance.

Hospital provision

Hospital education places can be found in maintained special schools (usually a particular type of special school known as a hospital school), maintained PRUs (sometimes known as medical PRUs), special and AP academies and free schools. Often these institutions will have a combination of hospital education places and other high needs (AP and SEN) places. The requirement in the current regulations is for hospital education places in maintained schools and PRUs to be funded in 2016 to 2017 at the same level per place as in 2015 to 2016. More information is available in high needs funding arrangements: 2016 to 2017.

I

Income deprivation affecting children index (IDACI)

The income deprivation affecting children index (IDACI) measures the number of children in a given area who are under the age of 16 and live in low income households. Local authorities’ mainstream pre-16 schools block funding formula can use a combination of IDACI categories and/or free school meals data to allocate their funding under the deprivation factor. Separate per pupil rates can be paid for 6 categories of the IDACI index, and for the primary and secondary phases. For 2016 to 2017 local authorities will use the updated IDACI 2015 bands.

More information can be found in academies funding allocation pack 2016 to 2017 academic year.

L

Lagged funding

A term used to describe funding based on the previous year’s census. For example, funding for 2016 to 2017 for most academies will be based on census data from the autumn 2015 census.

London fringe

An optional factor in local authorities’ mainstream pre-16 schools block funding formula but only for the 5 local authorities to which it applies (Buckinghamshire, Essex, Hertfordshire, Kent and West Sussex). The purpose of this factor is to support schools that have to pay higher teacher salaries because they are in the London fringe area, and where only part of the authority is in this area. It is applied as a multiplier to relevant factors. More information is available in schools revenue funding 2016 to 2017 operational guide.

Looked after children (LAC)

The term ‘looked after’ refers to children under 18 who have been provided with care and accommodation by children’s services. For academic year 2016 to 2017 funding the looked after children factor of local authorities’ mainstream pre-16 schools block funding formula covers all children who have been looked after for a day or more in the 2014 to 2015 financial year. More information is available in schools revenue funding 2016 to 2017 operational guide.

Lump sum

An optional funding factor in local authorities’ mainstream pre-16 schools block funding formula, although for academic year 2015 to 2016 it was used by all local authorities. Local authorities can set different lump sums for primary and secondary schools (middle schools receive a weighted average based on the number of year groups in each phase). The maximum lump sum is £175,000, including London fringe uplift. More information is available in schools revenue funding 2016 to 2017 operational guide.

M

Mainstream academy

An academy that isn’t a special or AP academy. Its pre-16 pupils are funded through the local mainstream funding formula rather than high needs place funding. Mainstream academies may have a special unit or resourced provision which is funded through high needs place funding, and/or a sixth form which is funded using the national 16-19 funding formula, and/or nursery classes funded through the early years single funding formula (EYSFF).

Minimum funding guarantee (MFG)

The MFG is a protection against changes in per pupil school budget share (SBS) funding between academic years. The amount of protection received by individual academies will depend on the impact of local changes in the mainstream pre-16 schools block funding formula and the effect of these on per pupil rates. The floor remains at -1.5% for 2016 to 2017. More information is available in schools revenue funding 2016 to 2017 operational guide.

Mobility

An optional funding factor in local authorities’ mainstream pre-16 schools block funding formula. ‘Mobility’ refers to pupils who started the school at an unusual time during the last three academic years, that is not in August or September (or not in January for pupils joining in reception). This factor allows funding to be targeted at schools experiencing levels of pupil mobility in excess of 10% of the whole school cohort. More information is available in schools revenue funding 2016 to 2017 operational guide.

N

National funding formula

DfE has published proposals for a new national funding formula for schools, high needs and early years funding. In March 2016 DfE published proposals to make the distribution of schools and high needs funding fairer, and in August 2016 DfE published proposals on early years funding reforms. These consultations have now closed.

More information is available in schools national funding formula, high needs funding formula and other reforms and early years funding: changes to funding for 3 and 4 year olds.

National non-domestic rates (NNDR)

An academy’s national non-domestic rates (NNDR) are refunded by EFA on receipt of a claim using an online form.

Notional SEN budget

Local authorities will have identified a notional special educational needs (SEN) budget in each school budget share. This is called notional because it is not a ring-fenced budget and academies can make their own decisions about how much to spend on SEN support given the needs of their pupils. The notional SEN budget can be used for high incidence, low cost pupils with SEN and to support the first £6,000 additional costs which schools must contribute for high needs pupils. Local authorities can retain funding to provide targeted support to schools whose notional SEN budget is insufficient. More information is available in schools revenue funding 2016 to 2017 operational guide.

P

Payments

EFA pays a general annual grant (GAG) to academies in monthly instalments. Remittance advice noted accompany payments. More information is available on the funding payments for academies page.

PE and sport grant

The PE and sport grant is additional funding given to publicly-funded schools in England to improve physical education (PE) and sport in primary schools. More information about the use of the grant is available in PE and sports premium for primary schools guidance, and information on funding rates for 2016 to 2017 is available in PE and sport premium: funding conditions for 2016 to 2017 guidance.

Post-16 funding

Funding based on the national 16-19 funding formula. For academies with sixth forms, this might be referred to as sixth form funding. It is also an optional funding factor in local authorities’ mainstream pre-16 schools block funding formula, but can only be used in 2016 to 2017 where the local authority had such a factor in 2015 to 2016. More information is available in schools revenue funding 2016 to 2017 operational guide.

Post-opening grant (POG)

Free schools, studio schools and university technical colleges (UTCs) are provided with a post-opening grant to reflect the additional costs in establishing a new publicly-funded school which cannot be met through the general annual grant (GAG). The post-opening grant provides funding in two elements as the free school grows: non-staffing resources, paid on a per pupil basis, and a leadership diseconomies grant.

Pre-16 funding

Usually associated with revenue funding for reception to year 11 pupils.

Prior attainment factor

An optional funding factor in local authorities’ mainstream pre-16 schools block funding formula, although it is used by nearly all local authorities. It often acts as a proxy indicator for low level, high incidence special educational needs. More information is available in schools revenue funding 2016 to 2017 operational guide.

Private finance intitiative (PFI) factor

An optional funding factor in local authorities’ mainstream pre-16 schools block funding formula. The purpose of this factor is to support schools that have unavoidable extra premises costs because they are a PFI school and/or to cover situations where the PFI ‘affordability gap’ is delegated and paid back to the local authority. More information is available in schools revenue funding 2016 to 2017 operational guide.

Pupil number adjustment (PNA)

EFA carry out a pupil number adjustment (PNA) for academies that receive funding based on estimated pupil numbers. The adjustment is calculated using schools census data to make sure funding more accurately reflects the actual pupil numbers present during the year. More information is available on the academies revenue funding allocations page.

Pupil premium grant

Pupil premium is a grant for publically funded schools in England to raise the attainment of disadvantaged pupils. The grant is payable to each pupil who has been eligible for free school meals at any time in the last six years, or who is looked after/adopted from care, or who has been a service child in the last 5 years. More information is available in pupil premium: funding and accountability for schools guidance.

R

Resourced provision

Resourced provision is where education takes place mainly in the classroom, but pupils are either withdrawn to a resource for specialist input or teachers from the resource deliver specialist help to the child within the classroom.

Revenue Funding Data Collection (RFDC)

RFDC is the annual collection of pupil data for those institutions funded on estimated pupil numbers, as determined by their funding agreement.

S

School budget share (SBS)

SBS forms the majority of the general annual grant (GAG) and is calculated by EFA using the funding factors determined by the local authority. More information is available in the schools revenue funding 2016 to 2017 operational guide.

Schools block

The dedicated schools grant (DSG) is divided into three blocks: the schools block, the high needs block and the early years block. The schools block relates to pupils in national curriculum year groups reception to 11 at mainstream schools and academies who are not in a special unit or resourced provision (who are funded from the high needs block). More information is available in schools revenue funding 2016 to 2017 operational guide.

Schools forum

The schools forum is a body comprising representatives of maintained schools, academies, and early years providers within a local authority area, together with other local partners and stakeholders. The role of the schools forum is to advise the council on matters affecting schools funding – principally the allocation of dedicated schools grant (DSG), and the local funding formulae which distribute budgets to schools, early years providers and other maintained education settings. It has some decision making powers, mainly in relation to central schools block expenditure. More information is available in schools forum: a guide for schools and academies.

Sparsity

An optional funding factor in local authorities’ mainstream pre-16 schools block funding formula. Schools that are eligible for sparsity funding must meet two criteria: first, they are located in areas where pupils would have to travel a significant distance to an alternative should the school close, and second, they are small schools. More information is available in schools revenue funding 2016 to 2017 operational guide.

Split site

An optional funding factor in local authorities’ mainstream pre-16 schools block funding formula. The purpose of this factor is to support schools which have unavoidable extra costs because the school buildings are on separate sites. Allocations must be based on objective criteria, both for the definition of a split site and for how much is paid. More information is available in schools revenue funding 2016 to 2017 operational guide.

Start-up grant (SUG)

Start-up grant is paid to sponsored academies. From September 2013 this was limited to full sponsored academies only. There are two elements, part A and part B. Part A is a flat rate allocation that is paid in the first year of opening. Part B is a formulaic allocation that is intended to contribute to costs, such as leadership, as a new academy grows towards full capacity. Consequently, part B may be paid over a number of years as the academy grows.

More information is available in the academies funding allocation pack: 2016 to 2017 academic year.

U

UIFSM

The universal infant free school meals (UIFSM) grant is funding for schools to provide free school meals to all pupils in reception, year 1 and year 2. More information is available in UIFSM: guide for local authorities and schools.

Published 25 February 2015
Last updated 2 November 2016 + show all updates
  1. Updated information and links to more information for academic year 2016 to 2017.
  2. First published.