The School Funding, Budget Statements and Outturn Statements (No. 2) (Wales) Regulations 2026 / Rheoliadau Cyllido Ysgolion, Datganiadau Cyllideb a Datganiadau Alldro (Rhif 2) (Cymru) 2026

Explanatory note

Reproduced verbatim from the instrument as published on legislation.gov.uk (Crown Copyright, Open Government Licence v3.0). The note is prepared by the responsible government department and is not part of the instrument itself.

The School Funding, Budget Statements and Outturn Statements (Wales) Regulations 2026 (“ the 2026 Regulations ”) revoke and replace the Education (Budget Statements) (Wales) Regulations 2002, the Education (Outturn Statements) (Wales) Regulations 2003 and the School Funding (Wales) Regulations 2010 (“ the 2010 Regulations ”) in relation to financial years that commence on or after 1 April 2027. The 2026 Regulations make provision for the funding of maintained schools in Wales for those financial years.

These Regulations revoke and remake the 2026 Regulations prior to the 2026 Regulations coming into force on 1 February 2027, with the errors in the 2026 Regulations corrected as follows—

the reference to sections 24(3) and (4) and 210(7) of the Education Act 2002 in the preamble of the 2026 Regulations is incorrect and these Regulations instead refer to sections 13, 14 and 32(2) of the Education (Wales) Measure 2011,

the reference to “pupil’s” in regulation 21(6)(b) and regulation 21(7)(a) of the 2026 Regulations is incorrect and these Regulations instead refer to “pupils”, and

in the Welsh text of paragraph 31 of Schedule 2 to the 2026 Regulations the reference to “ysgolion a gynhelir” is incorrect and these Regulations instead refer to “ysgolion”.

These Regulations do not remake regulation 2(2) of the 2026 Regulations. Regulation 2(2) of the 2026 Regulations made a consequential amendment to the 2010 Regulations and came into force on 1 April 2026.

Part 1 contains the introductory, revocation and interpretation provisions.

Part 2 deals with the non-schools education budget, the schools budget and the individual schools budget.

Regulation 4 and Schedule 2 set out the expenditure that constitutes the non-schools education budget. This budget relates to the expenditure on local authority functions that the local authority must retain centrally.

Regulation 5 requires the local authority to make an initial determination of the schools budget on or before 14 February immediately preceding a funding period. A “funding period” is defined in section 45(1B) of the School Standards and Framework Act 1998 (“ the 1998 Act ”) to mean a financial year or such other period as may be prescribed. These Regulations define “funding period” to mean a financial year within the meaning given to that term in section 579(1) of the Education Act 1996.

Regulation 6 defines the schools budget. The schools budget relates to the expenditure that is aimed at supporting schools.

Regulation 7 requires the individual schools budget to be determined on or before 14 February immediately preceding a funding period. A funding period is a financial year. The individual schools budget is defined in regulation 7 and Schedule 3. The individual schools budget is formed by deducting any or all of the expenditure items set out in Schedule 3 from the schools budget. It is for the local authority to decide what expenditure items from Schedule 3 to deduct from the schools budget. Whatever is left remaining in the schools budget after that exercise will form the individual schools budget.

It is a matter for the local authority to determine what to do with the expenditure items deducted from the schools budget and which are not allocated to its individual schools budget. A local authority may determine to retain those expenditure items centrally so that it will be responsible for meeting the cost of them. Alternatively, a local authority may determine to allocate those expenditure items to maintained schools. In which case the local authority will also allocate the funding for those expenditure items to maintained schools who will then be responsible for meeting the cost of them.

Part 3 deals with schools’ budget shares. Regulation 8 requires the individual schools budget to be allocated as budget shares to maintained schools. This means that the individual schools budget must be divided up into school’s budget shares with each maintained school receiving a budget share. Regulation 9 requires an initial determination of the amount of a school’s budget share to be made on or before 31 March preceding a funding period. Regulation 9 further requires the local authority to notify school governing bodies of the amount of their budget shares together with information about how the budget share was calculated and estimates of the budget shares for the following two funding periods.

Regulation 10 requires a local authority to determine a formula for the budget shares. Regulation 11 requires consultation on any changes made to the formula since the preceding funding period. Regulation 12 sets out how a local authority formula is to be published.

Regulation 13 makes provision for the delegated budget of a new school.

Regulations 14 to 26 set out the factors and criteria to be taken into account in determining schools’ budget shares. Regulation 24 makes new provision which allows a local authority to allocate a single budget share to the governing body of the federation and treat the schools as a single school for that purpose.

Regulation 27 allows a local authority to redetermine a school’s budget share in order to correct errors, and regulation 28 allows the Welsh Ministers to approve alternative arrangements to determine schools’ budget shares.

Part 4 deals with local authorities’ financial schemes. Regulation 29 and Schedule 4 specify the matters that must be dealt with in financial schemes.

Regulation 30 sets out how revised financial schemes are to be published and regulation 31 requires any revisions to be approved by the schools forum or the Welsh Ministers.