Agenda item

The Schools Forum considered a report (Agenda Item 6) which summarised two bids that had been received from schools with a deficit budget to access funding from the schools in financial difficulty de-delegated fund. The budget for the fund in 2016/17 was £332,600, which included the carry forward of the unspent budget from 2015/16 of £215,280. No payments had so far been made in the current financial year.

John Rankin Infant and Junior schools were in a federation, and from April 2016 were operating a single budget. The bid from John Rankin Schools was for £68,060 (out of a total deficit of £182,300) which was to cover one-off compensation/redundancy payments and the accountancy and IT additional support paid for to improve their financial systems and to put in place a deficit recovery plan.

The schools ended 2014/15 with a deficit, mainly due to poor financial controls. The schools set balanced budgets for 2015/16, but then didn’t implement the changes required and failed to control the expenditure. Since then, the Chair of Governors, Chair of Resources, School Business Manager, and Executive Head had all left, and WBC Finance had been providing significant support to the new team. A new Executive Head teacher would start in September 2016.

The current five year budget plan had been largely prepared by WBC finance staff, working with the new Chair of Governors, interim executive head teacher, and new school business manager. Approval of this funding would bring the school out of a deficit position a year earlier, although the new executive head would need time to consider the staffing structure moving forward.

The Schools’ Finance Manager verified that their current budget plan had been subject to scrutiny and that this bid met the criterion set by the Schools’ Forum. The financial controls in the school were also now more robust.

The bid from Westwood Farm Schools was for £76,000 (out of a total deficit of £127,370) which was to cover one-off termination packages. The schools ended 2015/16 with deficits mainly due to the cost of unforeseen exit packages of senior staff. A permanent Executive Head had been appointed from September 2016, and she had been involved in the preparation of the deficit recovery plan alongside the interim Executive Head. The plan had been scrutinised by and discussed with WBC finance staff. Approval of the funding would bring the school out of deficit a year earlier, and reduce the risk of needing to make further savings at the detriment of the pupils.

The Schools’ Finance Manager verified that their current budget plan had been subject to scrutiny and that this bid met the criterion set by the Schools’ Forum.

The Heads Funding Group (HFG) was unanimous in recommending to Schools’ Forum approval of both bids for the full amount requested. HFG were also asked to consider a proposal that where primary schools in deficit engage Schools’ Finance to work with them on deficit recovery, that this cost be deducted from the Schools in Financial Difficulty Fund without schools needing to make a separate bid for this funding to the Group. HFG agreed, and recommended this proposal to Schools’ Forum. The cost would be in the region of £2k to £3k if all primary schools currently in deficit were to pay for this additional support.

Keith Watts asked what guarantee could be offered that the schools would have proper management in the future. Ian Pearson advised that the Heads Funding Group had questioned the schools’ representatives and had sufficient confidence in the management teams going forward to recommend to the Schools Forum that the bids be granted. Keith Harvey confirmed that both cases had been viable and heads had confidence that both schools could reach surplus balances in five years.

Bruce Steiner stated that both schools had changed management teams. Patricia Brims asked what mechanisms were in place to prevent the new management teams from falling into the same position. Claire White advised that schools had delegated budgets and it was difficult for the council to intervene unless they were invited to. Ian Pearson added that monitoring and support was available. The schools’ governing bodies would scrutinise the schools budgets and the council offered training to governors to support them in their role. Bruce Steiner commented that as a finance governor he had received training.

Chris Davis asked what provision there was to support the schools to achieve financial efficiency. Claire White advised that when a school set a deficit budget there were rigorous controls and monthly budget monitoring. The budget planner provided to schools now included more information to help schools. The Schools Forum would receive a report in December 2016 to review the progress of all the schools with deficit budgets.

RESOLVED that the two bids for funding from the Schools in Financial Difficulty fund be approved and that the cost of additional support for schools in deficit from the Schools Finance team also be met from this fund.