12 reasons why the NAO’s report is a boost for free schools

December 11, 2013

The NAO have this morning published their report on free schools and their value for money. The report is reasoned and balanced – its headline conclusion is “the Department has made clear progress in delivering a policy priority and many new schools have been established quickly and at relatively low cost”. But it is (rightly) not shy about pointing out areas for improvement.

However, much of the commentary around the report has sadly focused on the negatives quoted by the NAO, and ignored the overall tone. This is especially true of what we might call vocal ideological opponents of free schools, who have unsurprisingly cherry picked some of the facts in the report as cover for their continued campaign against free schools, academies, and any form of school not under Local Authority control.

So, in order to redress the balance a little, here are 12 positive things the NAO find in the report:

  1. Free schools have opened quickly. From a standing start in May 2010, and much scepticism as to whether this policy would ever get off the ground, there are now 174 open schools providing 82,000 places to parents. The NAO point out this is significantly quicker than the first waves of Academies. Part of this speed has been through good use of temporary accommodation where DfE judge there is a need for the school but the permanent site isn’t yet ready.
  2. The numbers are good because there is a lot of interest out there in setting up new schools. There have been 1,103 applications in total to open a school. The vast majority of these have been written by volunteers in their spare time. And as anyone who has written one knows (as I do), these are not small forms to fill out. 29% of open schools so far have been set up by parent and community groups, and a further 18% by teacher led groups. Again, given some of the cynicism around this policy before 2010, this is a highly impressive display of civic activism (we might even call it the Big Society).
  3. Many of the schools – especially primaries – are opening in areas of need. 87% of all primary free schools are in areas forecasting ‘high or severe need for places’. Only 19% of secondaries are in the same areas. But it’s worth noting that a) 90% of all need for new places is in the primary phase, so you’d expect far more primaries to meet that need, and b) a further 22% of secondaries are in areas of moderate need.
  4. But free schools remain a demand led programme. It is worth repeating as the NAO do, that filling basic need is not the focus of the programme. Free schools are about providing additional choice for parents where there is a demand for them to be set up. So the point that the NAO make that, in half of all areas with severe need, there are no free school applications, is rather missing the point. Free schools there would be a helpful part of the solution, if there is local demand. But for a systematic approach towards providing the 350k extra places needed across the country, we need to turn to the separate £5bn capital pot the DfE has to create more basic need places through to 2015. The success or otherwise of that programme is nothing to do with free schools – and the £240m ‘wasted’ on free schools where there is no basic need is also a red herring.
  5. Free schools have been built cheaply. The average cost of a new free school is £6.6m (with ranges of costs from £700k to £11m for primaries, and from £1.2m to £36m for secondaries). Compare that to an average cost for a new secondary under Building Schools for the Future, some of which have been pretty spectacular failures. The NAO rightly pulls up the DfE for initially lowballing their capital estimates. But even with this recalculation, £6.6m still represents good value for money. The NAO notes that the DfE have lowered their capital costs by using an innovative approach to premises (essentially trying to use existing buildings as much as possible, reducing space requirements, and using frameworks for contractors). The NAO also flag that much of the higher cost buildings come because of higher land and construction costs in some parts of the country.
  6. There is – on the whole – demand. The headline figure is that only 16% of new free schools filled their places in 2012. But as I have said numerous times (and the NAO also note), many of these first year figures are highly unrepresentative because of the way free schools opened. The NAO found that in schools where they only signed their Funding Agreement weeks before opening (which is needed for a legally binding offer), or where the temporary site for the school is some way away from the original proposal, unsurprisingly numbers dropped off. Overall, 86% of all free school places are full, with many schools heavily oversubscribed. This is still too low, and there are a lot of schools with quite a few empty places. But again, context is key here. An application to be made for admission in a school’s second year is made in October of the first year – a matter of weeks after the school opened. Many of these will be in temporary accommodation. None of them will have Ofsted reports, exam results, or any form of track record. Even applying to a free school in its second year, as opposed to its first, is a risk for many parents.
  7. The DfE process for approving free schools is getting much better. Figure 7 of the NAO report is very informative at showing the changes to the process over time, with a continual strengthening of approval and scrutiny on proposer capacity and capability, and financial management. By contrast, the NAO is politely sceptical about some of the approvals for the 2010 openers, where costs were agreed on a ‘case by case basis’ and the process for approval was ‘developmental’.
  8. Bad free schools are stopped from opening… To date, 15 proposals that had been approved have been stopped by the DfE before they opened, and a further 14 have been delayed. This has either been because of concerns over the capacity of the proposer group, or because of lack of a viable site. £700k of pre-opening funds have been written off as a result of this. But this is actually an example of excellent value for money by the Department. If they (or the groups) thought that the schools couldn’t be run well, or could only operate in a high cost building, then it is far better to halt them at an early stage.
  9. …and some good ones as well. 23% of ‘good’ free schools as assessed by the scoring criteria are nevertheless rejected by the Department, either because they overlap against other applications for the same area or, for the most recent waves, because of their impact against the quality of other local schools. There is, in other words, some under appreciated nuance in the process.
  10. When open free schools struggle, action is taken. In the cases of Al Madinah, Discovery, and Kings Science Academy. the DfE have good processes in place for investigating them and taking swift action, including closing them or handing them over to new sponsors (albeit I still feel there is more to be done by EFA to proactively monitor schools so as to not need to depend on whistleblowers).
  11. Overall, free schools are performing at least as well as, and maybe better than, comparable schools. The sample sizes here are very small so caution needs to be taken. But the NAO note that for free schools inspected by Ofsted, 75% (18 out of the 24) were ranked Good or better. This compares to 70% for all Academies under the same period, and 65% of maintained schools.
  12. And they are not doing this because of additional funding. DfE made a conscious decision to initially fund free schools on an average per pupil basis for their LA area. The NAO found that “this did not overall provide Free Schools with a financial advantage”. Overall, free schools core funding is now equivalent to maintained schools and Academies funding in the same LA area (with an additional amount of central services funding to cover the purchase of services not offered by LAs). Free schools also receive money in start up phase – which has almost halved between 2010 and 2012 – and diseconomies funding which tapers away as they reach steady state. In other words, a free school that is full is funded just as much, and no more, than an Academy in its area, and its core funding is exactly the same as all schools in its area.

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