Richard Newton Chance summarises the changes looming in the new financial year.

Efficiency drive

If you are in one of the local authorities (LAs) to benefit from the National Fair Funding uplift in 2015-16, then your LA, through the schools forum, should have consulted with you on how the additional money will be distributed through their formula. The new allocations should be finalised early in 2015.

If you are in one of the authorities not receiving an uplift, it is still worth checking for changes in your local formula, as we are aware of a few radical alterations.

If your school is an academy, then you are going to get a lot less Education Support Grant (ESG) next year. If you are currently receiving £140 per pupil, then from September 2015 you will be receiving £87 per pupil. If this results in your total budget (including 16-18 funding) reducing by more than 1 per cent, then you will receive protection. If you had a higher rate than this historically, then you will have a lower rate of protection. Details are in Education Services Grant (ESG) – A guide to changes for the 2015-2016 academic year (http://tinyurl.com/maej8p4).

Employment costs

No matter what kind of school you are in, you are going to have to plan for significant increases in employment costs.

From January 2015, the Local Government Association (LGA) employers have agreed a 2.2 per cent pay increase for school and college support staff, so unless you have a pay policy that does not tie you to National Joint Council (NJC) pay increases, you will have to pay this.

From September 2015, the employer’s contribution rate to the new Teachers’ Pensions Scheme goes up from 14.1 per cent to 16.48 per cent, an increase that has to be found from school budgets.

In something of a double whammy, in April 2016 the employer’s National Insurance (NI) discount for paying into an occupational pension scheme comes to an end. At the moment, you receive a discount of 3.4 per cent on employer’s contribution on weekly income from £111 to £770. We think this will increase average teacher costs by 2.31 per cent.

Then there is the probable 1 per cent pay rise for teachers from September 2015. Depending on your pay policy, you may not have to give this to everyone but it is our position as a union that this pay award should be a uniform cost of living award so we think you should build it into your costs.

So by 2016-17 you will be paying an additional 5 per cent or so for your staff and, unless you are in a National Fair Funding uplift authority, there will be no additional money to pay for it.

To cope with these changes and any other cuts to come, it’s important to examine every area of your operation to make sure it is fit for purpose. Here are some ideas – please forgive the obvious:

1. We would expect the average distribution of costs in most schools to be 60 per cent on teaching staff, 20 per cent on other staff and 20 per cent on other costs. If the proportion of costs in your school is very different, then examine why.
2. Is the course choice on offer in Key Stages 4 and 5 really meeting the needs of your students? Is it too broad and, particularly at Key Stage 5, is it generating viable group sizes? (We would calculate the minimum viable average group size post-16 as about 18 students.)
3. How many teacher periods are going into each key stage? Does it broadly reflect the percentage of students in each key stage? If not, do you have a good reason for the disparity?
4. If you have falling rolls, are you adjusting staffing to reflect the reduced income and reduced demand?
5. Are you splitting each year group into too many teaching groups and thus generating relatively small class sizes?
6. Is there too much non-contact time in your staffing model? Remember, if you are not asking teachers to cover, then you are only required to allocate 10 per cent planning, preparation and assessment (PPA) time.
7. Could other areas of the school that involve staffing costs – premises, cleaning, catering – be organised in a different way?
8. Are there opportunities through collaboration with other schools to reduce costs? There are hard arrangements like multi-academy trusts, co-operative trusts and federations, but other arrangements may be possible, especially at post-16 level and in the use and support of ICT.
9. How are you utilising ICT to reduce costs? If you have data projectors in every classroom or a virtual learning environment (VLE) that works on any device that students may bring in, are you also printing worksheets?
10. Can you offer your ICT, premises, catering, or professional development expertise to other schools?
11. Are your sites and facilities giving you a return on investment outside school hours?

The most important piece of advice we can give is for the governing body and leadership team to take collective responsibility for the financial health of the organisation and to communicate, communicate, communicate!

Richard Newton Chance is ASCL Funding Specialist.

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