Ministers are being urged to bring funding for a scheme supporting looked-after young people in post-16 education in line with rates paid in schools, after an evaluation found wide inconsistencies across England.
A report into the national rollout of the pupil premium plus post-16 pilot, published this week, highlights significant variation in allocations. Some councils received as little as £110 per student, compared with £2,630 per pupil premium plus funding for looked-after children aged under 16.
Pilot leads said the additional funding – used to boost engagement and attainment among disadvantaged learners – was helping to “push back” the cliff edge of support at age 16. However, they warned that a lack of parity with school funding was placing pressure on provision.
The research tracked three cohorts of local authorities that joined the pilot between 2021 and 2025 and found persistent gaps in funding and delivery.
In 2023-24, councils received an average of £413 per student – around six times less than the £2,630 available for school-age pupils.
Virtual school heads called for the Department for Education to overhaul the post-16 funding formula so it mirrors the statutory pupil premium plus in schools, alongside providing long-term funding certainty.
Although funding was confirmed for 2025-26, it remains unclear whether the programme will continue beyond that point.
Two-tier system
The post-16 pupil premium plus pilot launched in 2021 with £3 million in funding for local authorities to appoint virtual school heads. These leads work with colleges, training providers and social workers to improve outcomes for looked-after young people and care leavers aged 16 to 18.
Thirty local authorities joined the first cohort, followed by an additional 28 in the second year and a further 94 from 2023-24.
DfE has spent around £40 million on the scheme in total so far.
The evaluation explored the programme up to the 2023-24 academic year and found earlier cohorts received higher overall allocations. Cohort 1 areas were awarded an average of £94,706, compared with £57,539 for those joining in cohort 3.
This reflected a funding cap that ensured councils in cohorts 1 and 2 did not see reductions of more than 15 per cent year-on-year. The cap was removed in 2024-25, meaning all authorities are now funded using the same formula.
Researchers said this change, alongside the expansion of eligibility beyond further education colleges to all post-16 settings, including apprenticeship providers, contributed to falling per-student rates.
Estimated funding per learner stood at £900 in 2021-22 and £920 in 2022-23, before dropping to £413 after eligibility widened in October 2023. Across the full 2023-24 academic year, this equated to an average of £355 per learner.
In 2023-24, average rates varied by councils depending on when they joined the pilot: £522 for councils in cohort 1, £440 for cohort 2 and £361 for cohort 3.
The report warned this was creating a “postcode lottery”, with allocations ranging from £110 to £1,257 per learner.
“This is despite DfE’s attempts to make funding allocation equitable across virtual schools and again suggests a postcode lottery effect in real terms,” it said.
Flexibility limits evaluation
Some variation also stemmed from how local authorities chose to use their funding.
Across all surveyed virtual school heads, the majority of funding (53 per cent) in 2023-24 went towards direct work with young people. Activities included tuition, provision of IT equipment, ESOL, mentoring, targeted NEET prevention work and enrichment activities.
The remaining funds were directed toward joint working and the virtual schools (23 per cent) and “support” for post-16 settings (21 per cent).
However, researchers said these activities were not mutually exclusive.
“For instance, where virtual school heads have chosen to allocate all or most of their funding to create a dedicated post-16 role in the virtual schools, other activities and outcomes are expected to flow from that role relating to all three types of activity,” the report said.
“The flexibility of the funding has allowed virtual schools to tailor support to local needs. However, variation between levels of funding, what this equates to per young person in real terms, the level of the virtual school’s pre-existing provision or staffing, and the variation in what the funding is used for creates a potential postcode lottery in terms of the level and type of support available.”
The report added: “While structured procedures existed for approving exceptions, the flexible application of funding criteria could lead to inconsistencies across local authorities, creating a potential postcode lottery in access to support for looked-after children and care leavers.”
Leaders called for a revised funding model that is not purely per-student, suggesting a guaranteed allocation to fund at least one dedicated post-16 role in each authority, topped up with individual allocations per eligible young person.
Around 75 per cent of virtual school heads reported using funding to create new posts or expand existing roles.
They also called for multi-year settlements, warning that short-term funding cycles were hindering strategic planning.
One lead said: “Our school improvement plan is centred around three-year goals in our journey – unfortunately, the time-limited element means many plans we have for post-16 have often been short notice or one-off projects, nor can we enhance our structure further with permanent or longer-term posts.”
The Department for Education has been approached for comment.
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