Agenda item

Melanie Ellis introduced the report (Agenda Item 10), which provided details of the most recent financial forecasts received from each of the nine schools with a licensed deficit and the two schools that had informed West Berkshire Council they expected to end the 2023/24 financial year with an unlicensed deficit balance.

The table under section 4.2 showed the positions when the licenses were approved. A key point to note was that in the column 2023/24, the total approved deficit was £524k. The table under 4.3 showed that the forecast deficit as at period nine had increased to a combined deficit of £691k. This meant that the profile of recovery would likely need to be extended. All but one of the schools were forecasting a worsening position.

The Local Authority (LA) had been made aware that two schools expected to end the year with an unlicensed deficit. The deficit for these schools amounted to £91k as shown under section 4.2 of the report. The table in the conclusion to the report showed how the deficits were growing, with an increase from five to 11 schools in deficit over the past four years with the average deficit increasing from £15k to £71k. More schools were expected to fall into deficit in 2024/25.

Reverend Mark Bennet noted that there was some intelligence around budget setting. He raised concern about the pressure on school business managers from the current financial situation and stressed that caring for staff was extremely important. He queried what capacity there was to support business managers. Melanie Ellis reported that there was a dedicated school resource in LA staff member Sarah Reynard, who supported all deficit schools. Melanie Ellis stressed however, that the workload was increasing significantly. Melanie Ellis reported that she was now supporting Sarah Reynard with this increasing workload and they were looking at a risk based profile for schools. Some schools required much more support.

Melanie Ellis further explained that there was still a LA School Accountancy Team and on a risk based approach some schools would be supported by this team, with the more challenging cases to be supported by Sarah Raynard. Rose Carberry and Melanie Ellis attended termly meetings with schools facing the most challenging situations. It was felt that business managers felt supported by the process however, it was often clear the amount of stress these members of staff were under.

Reverend Bennet asked if there was a way that it could be checked that business managers were being adequately supported by governing bodies. Rose Carberry reported that Sarah Reynard had a close working relationship with schools, which were either receiving termly or bi-annual meetings. Some schools also had a school advisor attached. More regular meetings were also taking place with finance governors.

Gemma Piper referred to section 3.2 of the report, where it detailed that the LA possessed the power to remove a deficit schools’ delegation and queried what this meant in reality. Rose Carberry reported that a meeting was due to take place soon to speak about this in more detail because currently no schools had required a Notice of Concern to be issued. Any case of this happening would need to be approved by the LA.

Lesley Roberts commented that headteachers were taking on more and more in an attempt to stay out of deficit. Lesley Roberts commented on the importance of lobbying in relation to the pressure facing school finance staff.

Gemma Piper asked what the consequences were if the deficits highlighted in the report were not resolved. Melanie Ellis reported that schools overall were in surplus by about £13m, so currently there was not a deficit against the block. It was noted however, that this could change to a deficit in the future. 

Councillor Cottingham noted that the table under section 4.2 showed the annual surplus and deficit, and queried the cumulative position. Melanie Ells confirmed the information in the table was cumulative data for each school. The Chair highlighted that the information provided forecasts at the current stage.

Rose Carberry referred to further discussion that was due to take place with AnnMarie Dodds shortly regarding the process for schools that were struggling to reduce deficits within the five years provided. The LA was aware of how hard schools were working to try and manage deficits.

RESOLVED that the Schools’ Forum noted the report.