The government has confirmed an extra £4.7 billion for schools up to 2029, as well as increased funding for Ofsted.

The plans are included in the government’s multi-year Spending Review, which says how each department will be funded over the four years ending in 2028-29.

Chancellor Rachel Reeves today said: “I’m providing a cash uplift of over £4.5 billion a year for additional funding in the core schools budget by the end of the Spending Review, backing our teachers and backing our kids.”

Budget increase

The core schools budget will increase from £64.8 billion to £69.5 billion over this period.

The £4.7 billion increase in the core schools budget is in cash terms, but when inflation is taken into account it amounts to around £2 billion in real terms over the Spending Review period.

That amounts to a 0.4 per cent real annual growth in the core schools budget over the four years, and a 0.7 per cent increase for the DfE’s entire resource budget.

Institute for Fiscal Studies (IFS) director Paul Johnson said the schools settlement is “tight”, and amounts to a real-terms freeze in the budget once the cost of expanding free school meals is stripped out.

He warned the government may have to freeze spending per pupil despite the increase to meet rising demand for special education needs and disabilities (SEND) provision.

The DfE said the extra cash will allow funding to grow in real terms by 1.1 per cent a year.

The DfE will see its total budget increase from £101 billion in 2025-26 to £109 billion in 2028-29.

The IFS said last month that protecting the schools budget would require larger cuts elsewhere - which could potentially affect policies such as universal infant free school meals and the PE and sport premium. The IFS warned that some programmes could end entirely.

As of yet, it is unclear whether the school funding settlement for 2025-26 includes the £615 million announced to fund teacher pay rises last month. 

Free school meals

The DfE announced a large expansion of free school meals last week, meaning all children in households in receipt of universal credit become eligible from September 2026.

The increase in the core schools budget includes £410 million per year by 2028-29 for this eligibility expansion, as well as £80 million for early years and post-16 settings.

Mr Sibieta said the expanded eligibility will cost around £1 billion in the long run, with a cost of around £400 to £600 million by the end of the Spending Review period. The cost of maintaining the schools budget in real terms and the extra cost of the expanded Free Schools Meals eligibility adds to around £4.5 billion, he said.

Paul Whiteman, general secretary of school leaders’ union the NAHT, welcomed the protection for school budgets, but said “this is not a time for celebration, and it is clear that school budgets will remain under considerable pressure for some time to come”.

Similarly, NEU general secretary Daniel Kebede said the union is “concerned this may not be enough to fix some of the fundamental problems facing schools”.

Schools are already having to make significant cuts, and this money will not be enough to change that situation in the short or long term, said Julia Harnden, deputy director of policy at the Association of School and College Leaders.

“We recognise that the national finances are tight but this Spending Review doesn’t go nearly far enough and we really need the government to treat education as a vital strategic investment,” she said.

SEND

The government has said it will set out its approach to SEND reform in a white paper in the autumn.

Spending Review documents also show the government will spend £547 million in 2026-27 and £213 million in 2027-28 on reform of the SEND system. This money will come from a £3.25 billion transformation fund.

Schools North East warned the funding increase would “barely offset” inflation and existing commitments such as pay rises, free school meal expansion and SEND reform.

“The situation is particularly stark in the North East, which already has the highest levels of child poverty, free school meal eligibility and SEND demand in the country,” the group said.

Ofsted

The DfE has also increased funding for Ofsted over the next two years, which it says will help develop and implement multi-academy trust (MAT) inspections.

Funding for Ofsted will increase from £139.8 million in 2025-26 to £159.4 million in 2026-27, before falling again over the next two years to £153.3 million.

Ofsted is in the process of developing a new framework for school inspections including report cards. 

Tes revealed earlier today that education secretary Bridget Phillipson had written to Sir Martyn Oliver expressing disappointment that inspection plans will not be finalised until after the summer holidays.

Capital spending

The DfE’s DEL for capital spending will increase from around £6.8 billion in 2025-26 to £7.7 billion in 2029-30 - an increase of 1.4 per cent.

In 2025-26, £1.4 billion of this is for the School Rebuilding Programme, and £2.1 billion is for school maintenance.

Of that £2.1 billion, £470 million is going towards repairs under the Condition Improvement Fund for schools in smaller academy trust and voluntary aided bodies.

Over the next four years, the DfE will commit around £2.4 billion per year to the School Rebuilding Programme, and has said it will “also commit to expand the programme, providing long-term certainty out to 2034-35”.

School maintenance funding will rise to £2.3 billion by 2029-30. The settlement also includes £2.6 billion that will be used for mainstream school places from 2026-27 to 2029-30.

Recruitment: 6,500 teachers pledge ‘supported’

Last month, DfE permanent secretary Susan Acland-Hood said detail on the DfE’s target to recruit an additional 6,500 teachers was holding for the Spending Review.

Not much detail has been provided yet, but documents state the schools settlement will support the recruitment commitment.

Internal efficiencies

The DfE has also said it will be “supporting” schools to find the first percentage point of the pay award for next year from their budgets.

Alongside existing programmes like the School Resource Management Advisers scheme, this work will include “new initiatives, tools and services” including a new toolkit to help schools adopt “evidence-based workforce deployment models”, the DfE said.

Efficiency documents published today also reveal the DfE will deliver £28 million in internal efficiencies in 2028-29 through greater use of AI, conversion of managed services and reviewing all non-staff expenditure.