Guidance

Academies revenue funding allocations

Information for academies about their annual revenue funding.

Introduction

The Education and Skills Funding Agency (ESFA) funds academies (including free schools, university technical colleges and special academies) on the same basis as maintained schools. We base allocations and payments to academies on an academic year, compared with financial year for maintained schools.

You can read a separate guide about funding for new academies.

A to Z of academies funding terms and acronyms

We explain the main funding terms and acronyms in our A to Z of academies funding.

Annual allocations

2020 to 2021 academic year

On 9 September 2019, The Minister of State for School Standards, Rt Hon Nick Gibb MP, made a statement setting out the key aspects of the funding arrangements for schools and high needs for 2020 to 2021.

For 2020 to 2021 we’ll again use the national funding formula (NFF) to calculate notional school-level allocations, which in turn, we’ll use to set the total funding available for schools in each local authority area. Local authorities continue to set a local formula to distribute that funding, in consultation with local schools forums, and within the framework of the schools operational guide, to determine individual schools’ budgets in their areas.

Information is also available on 16 to 19 funding following the Chancellor’s announcement. This will be of interest to academies with sixth forms.

We’ll add further detail here during autumn 2019 about academy general annual grant allocations for 2020 to 2021.

2019 to 2020 academic year

In July 2018, Minister Gibb set out the schools revenue funding arrangements for 2019 to 2020.

He confirmed the second year of a ‘soft’ national funding formula (NFF) for schools funding and for high needs funding. This means that for 2019 to 2020, we’ll use the NFF to calculate notional school-level allocations, which in turn, we’ll use to set the total funding available for schools in each local authority area. Local authorities continue to set a local formula to distribute that funding, in consultation with local schools forums, to determine individual schools’ budgets in their areas in 2019 to 2020.

You can find detailed information in the pre-16 funding guidance for 2019 to 2020 and in high needs funding guidance for 2019 to 2020. You can also view the detail of the arrangements for the early years NFF for 2019 to 2020.

Education services grant (ESG) protection for academies will continue in 2019 to 2020 at the current rates to protect academies from excessive changes in funding as a result of the ending of ESG.

General annual grant allocation statements for 2019 to 2020 timetable

We’ve uploaded academy general annual grant allocation statements for the 2019 to 2020 academic year for all academies open on 1 January 2019. These are available in Document Exchange. If you’re unsure about your access to Document Exchange there’s guidance available on GOV.UK.

We’ve issued allocation statements for 2019 to 2020 for February and March 2019 opening academies.

We’ve published academy general annual grant allocation guidance to help academies understand their funding allocation statement.

Academy funding in 2019 to 2020: an overview of funding for the current academic year

We calculate most of an academy’s revenue funding using the pupil numbers taken from either the autumn census return or an agreed estimate of pupil numbers, as outlined in the academy’s funding agreement.

Academies funded on estimates may be subject to the pupil number adjustment process; visit our academies funded on estimates page for more information.

We used pupil numbers from either the autumn 2018 census or the agreed estimate of pupil numbers for the 2019 to 2020 academic year.

For 2019 to 2020, we’ll continue to use a national funding formula (NFF) for schools and for high needs, which we have used to allocate budgets to local authorities.

It is important to note that the NFF school-level allocations that we published in September 2018 were notional allocations only. In 2019 to 2020, local authorities have continued to set a local formula which has determined individual school and academy budgets in their authority. As in previous years, local authorities submitted this local formula to us so that we could produce and issue academies allocation statements.

The general annual grant (GAG)

Most funding for academies comes from the general annual grant (GAG). This is made up of:

  • school budget share – calculated on the same basis as for maintained schools in the same local authority. The academy general annual grant allocation guidance for 2019 to 2020 explains how we calculate the school budget share.

  • education services grant (ESG) protection if applicable

The minimum funding guarantee (MFG) is a protection against changes in per pupil school budget share (SBS) funding between the 2018 to 2019 and 2019 to 2020 academic years. The amount of protection will vary according to the impact of local changes in the funding formula and the effect of these on individual per pupil rates.

In 2019 to 2020, local authorities have the flexibility to set local MFG between +0.5% and -1.5% per pupil in order to offer higher levels of protection locally.

Where appropriate, the GAG may also include funding for high needs places, 16 to 19 students and start-up funding for new institutions.

Education services grant (ESG) protection

From September 2017 the ESG general funding rate was removed. We put in place protection arrangements for academies following the removal of the ESG general funding rate. The percentage protection for an academy was determined by its level of ESG per pupil (ESG + ESG protection) in the 2018 to 2019 academic year.

The protection thresholds for 2019 to 2020 are set out in the table below:

ESG allocation per pupil in 2018 to 2019 ESG protection in 2019 to 2020
Up to and including £77 per pupil Loss protected at -1% of total allocation
More than £77 and up to and including £87 per pupil The first £77 per pupil is protected at 1% and the amount above £77 is protected at -2% of the total allocation
More than £87 per pupil The first £77 per pupil is protected at 1%, any amount above £77 up to and including £87 is protected at -2% and any amount above £87 will be protected at -3% of the total allocation

Schools converting to academy status from September 2017 onwards are not eligible for ESG funding or ESG protection.

16 to 19 funding

Information about how colleges, schools and academies receive their 16 to 19 allocations is available on our 16 to 19 funding allocations guidance page.

High needs funding

Local authorities commission education provision for pupils that attract high needs funding. This means academies receive high needs funding from both ESFA and local authorities.

We have published information on high needs funding arrangements for 2019 to 2020.

Academies revenue payments

ESFA pays academies’ GAG in 12 equal instalments in accordance with the terms set out in the academy’s funding agreement. A monthly remittance note accompanies each payment. Revenue funding: payments to academies explains how academies are paid and how to change bank details.

Revenue funding outside the general annual grant

Many academies receive funding outside their GAG, including:

Published 11 March 2014
Last updated 16 September 2019 + show all updates
  1. Updated with information for 2019 to 2020
  2. We've added the link to the 2019 to 2020 general annual grant allocation guidance for academies that were open before 1 April 2019.
  3. We have confirmed ESG protection arrangements in 2019 to 2020 for eligible academies.
  4. We've updated the page to include high level information about 2019 to 2020
  5. We've updated the section 'General annual grant allocation statements for 2018 to 2019 timetable' to reflect that we have issued 2018 to 2019 academy GAG allocation statements for all academies open at 1 January 2018.
  6. We've added a link to the 2018 to 2019 academy general annual grant allocation guides
  7. We've updated the funding allocations information 2018 to 2019
  8. Information added on timeline for 2017 to 2018 academic year allocations.
  9. Updated to include information on ESG protection.
  10. Updated information and removed information for academies funded on estimates to a separate page.
  11. Information about 2014 to 2015 removed. Details of pupil number adjustment for 2015 to 2016 added. Information about 2016 to 2017 funding added including education services grant rates.
  12. Link to funding video for 2016 to 2017 added.
  13. Links to funding videos on YouTube added.
  14. This page has been updated to include the pupil number adjustment calculator for the 2014 to 2015 academic year.
  15. Links to funding training videos and registration for webinars added.
  16. ESG rates for 2015 to 2016 academic year added and a link to a guidance note about the ESG changes.
  17. Updated to add a letter to academies about funding arrangement for 2015 to 2016
  18. Updated pupil number adjustment calculator added.
  19. Pupil number adjustment (PNA) details for the 2013 to 2014 academic year added.
  20. First published.