The number of councils holding back funding to support schools with falling rolls is set to more than treble.
The change is set out in revealing how councils will allocate the school funding they receive in 2026-27.
Local authorities set their own funding formulas to distribute “schools block” funding - the main pot in the Dedicated Schools Grant (DSG).
Most councils allocate the money according to the, which calculates the amount each school should receive, based on factors including levels of deprivation and pupil numbers.
The DfE has been “tightening” the formula by requiring local authorities to move closer to it, but there are still variations across the country.
Here are the four main trends for 2026-27:
1. More councils keep funds for falling rolls
Local authorities can retain some of their funding to support schools with falling rolls, in case of a future population bulge.
As primary schools have seen pupil numbers increasingly drop, there has been a large increase in councils keeping a falling-rolls fund.
In general, the money can only be given to schools where places will be needed in 2026 to 2027, or either of the two subsequent years.
However, it can also be used to make redundancies, and to or early years places.
For 2026-27, 96 councils are operating a falling-rolls fund totalling £14 million, up from just 29 with funds of £10.7 million in 2025-26.
Falling-rolls funds for individual councils range from £50,000 to £2.1 million.
2. The 20 councils not mirroring the NFF
Of 152 local authorities, 20 are not funding schools to within 2.5 per cent of the NFF value across at least one factor - down from 25 last year.
For example, Barnsley is outside these bounds on primary and secondary free school meals. The DfE document does not state whether councils are paying more or less than the NFF.
Here’s the full list:
- Camden
- Hackney
- Kensington and Chelsea
- Southwark
- Wandsworth
- Brent
- Croydon
- Merton
- St Helens
- Manchester
- Stockport
- Barnsley
- Sheffield
- Kirklees
- Bristol
- Brighton and Hove
- Swindon
- Telford and Wrekin
- Hertfordshire
- Surrey
3. Schools in 3 councils will be funded below minimum level
The NFF sets a minimum per-pupil funding level: £5,115 for primary pupils, £6,388 for key stage 3, and £7,018 for key stage 4.
Most local authorities stick to these, or exceed them.
For 2025-26, North Tyneside, Kent and Bracknell Forest were allowed to set a lower level due to having Safety Valve deals, under which they received short-term funds if they agreed plans to balance their SEND budgets.
For 2026-27, Kent and North Tyneside again gained approval to set lower minimum funding levels.
Bracknell Forest did not set a lower minimum per-pupil funding level for 2026-27, but York did.
In those three areas, the minimum per-pupil funding is set at:
- North Tyneside - £5,089 for primary, £6,356 for KS3, and £6,983 for KS4
- York - £5,083 for primary, £6,356 for KS3, and £6,986 for KS4
- Kent - £5,069 for primary, £6,331 for KS3, and £6,955 for KS4
4. Deprived schools receive slightly more
The funding formula has three elements related to deprivation: eligibility for free school meals (FSM) now and in any of the last six years (FSM6), and levels of income deprivation affecting children (IDACI).
There has been a small increase in the proportion of funding that councils allocate through these values - from 10.7 per cent in 2025-26 to 11.2 per cent in 2026-27 - compared with 11 per cent in the NFF.
