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The funding of UK schools and the Green Paper on modernising local government finance are discussed. The paper says funds should be distributed between local authorities fairly to 'reflect pupil needs'.

The current system of funding for UK schools is clearly unfair, creating significant differences in expenditure between local education authorities and regions. The UK government has recognized this problem, but will not take any action until a three-year research project into the allocation of money to schools is completed. It is clear that action must be taken more urgently than this. The government must consider moving to a needs-based national funding formula, and the local education authorities that need to do so must be allowed to exceed the level of total expenditure implied by the unofficial capping guidelines from Deputy Prime Minister John Prescott.

The UK government's award of an additional 19 billion pounds sterling for education will have to be shared by schools and higher and further educational establishments. The sum will be allocated over a period of three years. Funding in schools relies on the attitudes of the Local Education Authorities (LEA). Action should be taken to ensure all schools receive the same funds. There are fears extra funds may not be passed on to education. In the past some LEAs have not followed government initiatives, such as cutting class sizes, even though they had received the funding.