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Spending per pupil will be 3% below 2010 levels in real terms by the end of this Parliament as schools grapple with soaring costs, economists have warned.

The respected Institute for Fiscal Studies said the Government would miss its target to restore cash per pupil to pre-austerity levels by 2024-25 due to “unexpectedly high cost pressures”.

Its analysis warned of a “very significant squeeze on school resources” over the next three years.

Costs would grow by 6% in 2022-23 due to staff pay and rising energy and food prices, it estimates, in line with 7.7% boosts in funding.

But school costs will then rise 4% the following year, while funding will only increase by 3%, the IFS said.

Heads are already warning about the impact of rising energy costs, as schools are not subject to the energy price cap like ordinary households, which means there is no limit to how high their bills can spiral.

The IFS estimates that school spending per pupil would fall to 1% in real terms 2023-24 and “continue to stagnate in 2024-25”.

Schools could be forced to make cuts, unions have warned ( Getty Images/Image Source)

Luke Sibieta, IFS research fellow, said: “On top of rising energy and food prices, schools now also face the cost of rising salaries for teachers and support staff.

“Within the context of a £4billion rise in the school budget this year, these costs look just about affordable – at least on average.

“Next year looks much more problematic, however, with growth in funding per pupil expected to fall below growth in school costs.

“Indeed, the fast rises in school costs will reduce school budgets’ purchasing power and leave spending per pupil in 2024 still about 3% lower in real-terms than in 2010.”

Union chiefs warned that schools will have to make cuts to staff and services next year unless they get help, which will mean children lose out.

Paul Whiteman, general secretary of school leaders’ union NAHT, said they had been warning about the impact of cost of living pressures for months and heads were facing the threat of a full on crisis.

He said: “The impact of massively increased energy costs, as well as the cost of food, amongst other things, has coincided with an unexpected increase in staffing costs, due to the government’s decision not to fund pay awards, leaving schools scrambling to find the money to pay it.

“School leaders are already worried that they simply won’t be able to make their budgets balance next year, let alone the years that follow.

“There is no doubt that the reality of the government’s current approach to education funding will lead to cuts to education, services and school staff next year.”

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Julia Harnden, of the Association of School and College Leaders (ASCL) union, warned that some schools will be hit even harder due to different funding allocations and cost pressures.

She said: “It is a very poor reflection on the government’s priorities that it will have presided over a 15-year decline in school funding by the end of this parliament.

“While it may argue that there are inflationary pressures beyond its control, the fact is that it is the government itself which has proposed a teachers’ pay award for September without providing any additional funding for schools to afford these costs, and it has also consistently ignored our repeated warnings about the impact of soaring energy costs.”

Shadow Schools Minister Stephen Morgan said: “The Conservatives are failing our children with staff numbers falling, school buildings in a state of disrepair and fewer trips, clubs and enriching activities.

“But Conservative leadership contenders would rather bluster about the return of grammars than pledge any real action to secure children’s education.”

A Department for Education spokesman said: “We recognise that schools – much like the wider economy – are facing increased costs due the unprecedented recent rise in inflation.

“To support schools, budgets will rise by £7 billion by 2024-25, compared with 2021-22, with the total core school budget increasing to £56.8 billion.

“In the current financial year alone, core school funding is rising by £4 billion compared to the previous financial year, a 7% cash terms per pupil increase, which as the IFS concludes will mean that any increased costs are broadly affordable for schools in 2022-23.”

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