Demystifying ICFP

Confused about how to approach integrated curriculum financial planning? SBM expert, Val Andrew, explains all and offers some advice

Since the Department for Education chose to advocate integrated curriculum financial planning (ICFP) as an essential element of strategic financial planning in every school and academy trust, there has been a lack of clarity about what it involves – and how it should be used. ICFP is an approach that puts the curriculum at the heart of the budget planning process and links the two areas together. It’s designed to stimulate discussion between financial decision-makers within a school or trust and give them a deeper understanding of the areas where there is pressure, financial challenge or deviance when expenditure is benchmarked elsewhere.
Most importantly, this is a methodology that applies for a single school, or across a group of schools, and to all phases of education. Various metrics and ratios will differ between primary, secondary, all through and special settings but, regardless, it remains a viable financial planning tool.
ICFP is no silver bullet that will deliver financial efficiency or solve the current funding crisis, and it’s not a brand new approach – in fact, many schools are already using this methodology in one form or another as part of their financial planning processes. Using ICFP won’t deliver a one-size-budget-solution that applies to all educational settings, but it will reinforce where there is the potential to deliver financial efficiencies and help schools decide how strategies will be implemented that best suit their specific circumstances.
Delivering a balanced budget
In very simple terms, this methodology combines a set of key metrics that pivot around the concept of the pupil-teacher ratio (PTR), which informs how many teachers a school needs to deliver a balanced budget. The key curriculum metrics include calculating the average class size (an operational view of the PTR) and the contact ratio (the amount of time teachers spend teaching/in front of students). The financial metrics include calculating the average teacher cost, the amount of income generated per pupil and understanding the proportion of the overall budget available for financing curriculum delivery. The relationship between these metrics can be explained in this equation:
(ATC: average teacher cost; I: amount of income available to spend per pupil; PTR: the proportion of budget available to spend on teachers; ACS: average class size; c: contact ratio)
The financial metrics are on the left and the curriculum metrics on the right. The pivot point is the PTR. By comparing actual PTR with affordable PTR schools can then decide where there is potential to manipulate expenditure to ensure a balanced budget. Although this approach looks incredibly data-driven there are some really important contextual factors that schools would be wise to consider alongside this financial planning method. This isn’t an exhaustive list, but these include:

• What must, should and may be included in our curriculum – that is, the mandatory, necessary and desirable aspects of what we provide for the children/students.
• How many teachers will we need (in order to deliver the above) over the next three-to-five years and beyond?
• How many teachers can we afford over the next three-to-five years and beyond?
• How many support staff do we need over the next three-to-five years and beyond?
• Is the leadership structure we have financially sustainable?
• How realistic are our pupil number projections for the period in question?
• Is there scope to deliver any additional economies elsewhere?
• What does the benchmarking data comparison tell us?
• What are the specific financial risks for our school and how should we mitigate them?

Promises of additional funding for education are welcome – but by no means guaranteed just yet – so a range of best, worst and most likely case scenarios are advisable. These shouldn’t overlook things like maintenance of buildings and the school site, and the health and wellbeing of children and staff.
Using ICFP properly
Finally, remember there is no ‘one-size-fits-all’ solution that fits every setting. This approach is not about identifying where staff redundancies might be achieved; rather, it’s a way of providing data in a range of expenditure areas to help those with budget responsibilities make informed decisions about the allocation of funds each academic year that are right and appropriate for your school.
Used properly, ICFP can engage everyone in the debate about where it is best to allocate funding, and generate a broader understanding about the needs of a specific school/trust. And remember – you don’t have to pay for one of the ICFP tools that are now on the market; there is free, very helpful, guidance on the DfE website, and you’ll find that your networks of school business colleagues will have advice on applying the concept of ICFP.
You’ll be reassured by them that you’re not alone in your ICFP worries – and probably discover that you are successfully using elements of the approach already.
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