Financial pressures disproportionately affect local authority-run schools

Spending watchdog reports that financial pressures are disproportionately affecting local authority-run schools

CREDIT: This is an edited version of an article that originally appeared on The Guardian

Children’s education is being eroded by financial pressures triggering staff cuts and scaled-back curriculums, with local authority-run secondary schools among the worst hit, according to parliament’s spending watchdog. The Department for Education (DfE) insists the school system in England is in good financial health overall, but a report by the public accounts committee (PAC) warned that national figures ‘mask significant variation and challenges for individual schools’.

One-in-four secondary schools maintained by local authorities were in deficit in 2019-20, forcing them to cut staff, narrow the curriculum and reduce support for pupils with special educational needs and disabilities, it said. In contrast, the report highlights the relative wealth of some academy trusts which have built up large reserves with a cumulative surplus of £3.1bn – money which is, therefore, not being spent on current pupils’ education, the report points out.

More than one-in-five academy trusts (22%) had reserve balances equivalent to more than 20% of their annual income in the year ending 31 August 2020. Academy trusts may decide to build up their reserves to pay for capital works, but the PAC has called on the education department to investigate whether the highest reserves are justified. The PAC report said 88% of schools maintained by local authorities, and 93% of academy trusts, in England were in surplus; behind these figures however, the report points out that, in 26 local authorities, more than 20% of maintained schools were in deficit.

The DfE said later that the most up-to-date figures showed 95.9% of academy trusts, and 91.6% of maintained schools, now have balanced accounts and the percentage of maintained schools in deficit had decreased from 12% in 2019-20 to 8% in 2020-21.

“Investment in schools is rising; we have confirmed an overall £4.7bn increase to the core school budget by 2024-25 and will continue to deliver, year-on-year, real terms per pupil increases – including a 5% real terms per pupil boost in 2022-23,” a spokesperson said.

MPs on the PAC said the DfE had little assurance that the extra £4.7bn for school funding from the 2021 spending review would be enough to cover cost pressures, including the impact of the COVID pandemic. They also raised concerns about the government’s national funding formula – introduced in 2018-19 to make the funding of England’s schools more fair and transparent – which has resulted in the rebalancing of funds away from deprived schools with a higher proportion of children eligible for free school meals.

 “The DfE’s airy assurances about the healthy books of academies, in particular, mask some cruel divides between the haves and have-nots,” said PAC chair Dame Meg Hillier. “Rather than…blithely looking for laurels to rest on, the DfE must grasp that it’s not OK for any group of our children to be abandoned in the system that it oversees.”

Kevin Courtney, joint general secretary of the National Education Union, said, “This report highlights problems in the education system that are longstanding and have seriously hindered the ability of schools to give every child the education they deserve.”

Meanwhile, colleges in England are facing their worst staffing crisis for two decades, with 6,000 job vacancies, according to a report by the Association of Colleges. There are, on average, 30 vacancies in each institution, while one college reported 162 vacancies.

“The issue for colleges around recruiting and retaining staff has been building for some time,” said Kirsti Lord, the association’s deputy chief executive. “It is a symptom of the decision to freeze or reduce colleges’ funding for over a decade, and has left the sector struggling to keep pace on pay.”