For the purpose of determining budget shares, a local authority must use factors or criteria which differentiate between different categories or descriptions of school in so far as the functions of the governing bodies of those schools justify such differentiation, but may not otherwise do so except as required or expressly permitted by these Regulations.

A local authority must use factors or criteria which differentiate between a school and other schools of the same category or description if such differentiation is justified by reference to the choice made by that school’s governing body as to the inclusion in their school’s budget share of funding in respect of expenditure of the kinds referred to in paragraphs 13 (admissions), 14(a) and (b) (meals), 27 (insurance) and 29 (library services) of Schedule 2.

A local authority may use factors or criteria in their formula which differentiate between maintained nursery schools, primary schools, secondary schools and special schools, or between schools whose pupils are in different age ranges.