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Abstract
This article focuses on the financing of school-based education and the ways in which this has changed since the Labour Government was elected into office in May 1997. It also analyses fundamental problems associated with the current system and how these might be rectified. The main conclusions are that although the Labour Government has made clear efforts to target money on areas with high levels of poverty, the system by which most funds for education are allocated, via local authorities, is fundamentally flawed. In order to make informed, evidence-based judgements about how much money is needed for education, high quality research needs to be carried out. This should establish the resources needed to enable children with different levels of prior attainment to meet specified educational goals in the context of different levels of disadvantage in schools. Only then can the Government be sure that adequate funds are being targeted where they are most needed.