How academies are funded

Find out how your general annual grant (GAG) funding is calculated, and what government funding you're entitled to on top of your GAG.

Last reviewed on 5 January 2023
See updates
School types: Academy · School phases: All
Ref: 3523
  1. The national funding formula (NFF)
  2. The general annual grant (GAG)
  3. Mainstream schools additional grant for 2023-24
  4. Funding outside the GAG

The national funding formula (NFF)

LAs determine your school's core budget using a local funding formula

The government uses the national funding formula (NFF) to work out your 'notional' core funding allocation. However, your actual allocation is based on a local funding formula from your local authority (LA) – this is the same system as for maintained schools.

But, unlike for maintained schools:

  • Your LA will submit its local formula to the Education and Skills Funding Agency (ESFA), so the ESFA can issue academies allocation statements – as explained in the 'introduction' section of this ESFA funding allocation guidance
  • Your funding allocations are:
    • Paid directly to your trust by the ESFA
    • Based on the academic, rather than financial, year

This is explained in guidance from the ESFA

The transition to the direct NFF

The direct NFF will mean your school's budget will be allocated directly by the central government