An analysis by the IFS estimates that public spending on education in the UK will fall by 13.4 per cent in real terms between 2010-11 and 2014-15, representing the largest cut in education spending over four years since at least the 1950s.
Capital spending and higher education will be the worst hit, followed by 16-19 education and early years provision, the report says.
The IFS says that spending on early years and youth services is expected to be cut by more than 20 per cent in real terms.
The report contrasts the cuts to early years with spending in early years under the previous Labour Government, when it was one of the fastest growing areas, alongside capital spending on schools and further education. During the ten years to 2010 spending one education rose by 5.1 per cent in real terms.
Following the cancellation of the Building Schools for the Future project, capital spending on schools will be more than halved.
Spending on schools will see the smallest cut – 1 per cent on real terms.
However, any cuts to higher education will be offset by tuition fees, the reports says.
The report says, ‘Spending on the Early Intervention Grant – which combines many aspects of Sure Start, early years and youth services – will be cut by 13 per cent in real terms in 2011–12 and cumulatively by 22 per cent by 2014–15, if current spending plans are delivered. This is more than the average cut to resource spending across the department as a whole, and thus early years and youth spending are due to receive a disproportionately large cut.’
Luke Sibieta, senior research economist at the IFS and co-author of the report, said, ‘Having risen by historically large amounts during the 2000s, the UK’s education budget is now set for an historically large fall over the next few years.
‘Schools will see smaller real-terms cuts than other areas of education spending, while cuts to public spending on higher education will be more than offset by higher tuition fees.
‘The biggest challenges lie ahead for the early years, youth services and 16–19 education, where spending is set to fall by around 20 per cent in real terms. Of course, the key question is what these cuts in financial resources will mean for the outputs of the education system, such as young people’s exam results or earnings potential.’
A DfE spokesperson said, 'The Government had to take tough decisions to reduce the deficit, but the schools’ budget is actually increasing by £3.6 billion in cash over the next four years. This protects per pupil funding levels and includes the new Pupil Premium, which provides an extra £488 for every child on Free School Meals and which will rise over the next 3 years.
'On top of this, we’ve increased the free entitlement to 15 hours per week for all three and four year olds from last September – and are now extending it all disadvantaged two-year olds. The two year freeze on teachers’ pay also means schools are benefitting from a lower level of inflation.
'The new capital budget is higher than the average annual capital budget between 1997-98 to 2004-05. But the Government was absolutely right to look at the amount of money spent on school buildings. An independent review showed that tax-payers money was being wasted on red-tape and consultants, not on building schools. Our new plans will build schools cheaper and quicker than before. '
