'Pupil premium' means school cuts elsewhere - Gove

The government's "pupil premium" will lead to funding cuts for some schools, education secretary Michael Gove has said.

The £2.5bn policy - a key Lib Dem manifesto pledge - will increase the budgets of schools in England with a higher proportion of poorer children.

But Mr Gove told BBC1's Politics Show this would mean some schools "will have less".

Labour said the Lib Dems had been "sold a pup" by the Tories over the policy.

It comes as Deputy Prime Minister and Lib Dem leader Nick Clegg and business secretary Vince Cable both appeared to rule out unlimited fees for university tuition in England, when the government announces its response to Lord Browne's review of higher education funding in about two weeks time.

'Tight settlement'

Mr Gove said the government was still working out which schools would face cuts to their budgets.

He told the Politics Show: "It depends precisely on whether or not we allow the pupil premium to go to slightly more children or we target it very narrowly on the very poorest.

"Depending on that, you can then make a calculation about which schools will find that they're actually losing funding and which schools will find that they're gaining funding."

He added: "It's a very tight settlement and that does mean, and I won't run away from it, that there will be some schools that will have less."

Prime Minister David Cameron pledged in June that the pupil premium would be funded by money from other government departments.

He told the Commons: "We will take money from outside the education budget to ensure that the pupil premium is well funded."

But Mr Gove admitted to the Politics Show: "Some of it comes from within the education budget."

'Bring costs down'

He added: "Quite a bit of it comes from welfare spending... we've ensured that there is money that comes from welfare which is being spent on pupil premium and, without the welfare cuts, we wouldn't be in the position to have a real terms increase in school spending."

Professor Richard Grayson, who helped Mr Clegg devise the pupil premium policy, said the Lib Dems had been assured that the funding for the scheme would be on top of the existing education budget.

"As the facts emerge, it does become clear that there are going to be losers in the education budget, there are going to be children who are in schools who have less money, and that is not at all what we were aiming for," he told BBC Radio 4's The World This Weekend.

In Wednesday's Spending Review, Chancellor George Osborne said the schools budget would increase by 0.1% in real terms but he also scrapped the Education Maintenance Allowance (EMA), given to poor 16 to 19-year-olds to encourage them to continue their schooling.

And he slashed capital spending by 60% in real terms, with the Department for Education (DfE) expected to make a 3% reduction in its "resource spending" by 2014-15.

Mr Gove was also challenged on the Politics Show about whether school building schemes that had been given the green light now faced funding cuts of up to 40%.

He said the government was currently negotiating with building firms and wanted to "bring costs down".

Schools were informed about potential funding cuts in July, he added.

Shadow education secretary Andy Burnham said the Conservatives had promised Mr Clegg that funding for the premium would be additional to the overall schools budget - but this was "not the case".

He told Sky News: "The big issue here is that the pupil premium is a con. When the Lib Dems and Labour were in talks after the election, this was an issue upon which those talks foundered.

"The Lib Dems said to us: 'The Tories have agreed to fund the pupil premium over and above the schools budget. Will you do the same?'

"And Labour said: 'Well we can't because the money isn't there to give a pupil premium over and above.'

"And that is why the political significance of this issue is huge. Mr Clegg was sold a pup - he has not got what he said he had got and he's not been able to reassure his MPs on this point."