3. Information/Background
3.1 In the June schools forum report on school balances the information on balances contained the following section
(d) Schools with balances greater than thresholds identified in the DfE Balance Control Mechanism
The balance control mechanism was introduced by Government in 2007 and operates where surplus balances are: -
Nursery, Primary and Special Schools Greater than 8% of budget
Secondary Schools Greater than 5% of budget*
* We have included 6th form income as budget for the 3 schools with sixth forms
** For schools with special units and special schools who now receive their funding in place funding and top up funding as income we have included this as budget for this purpose.
The following table shows the number of schools who have balances in excess of these thresholds:
Phase |
Number >5 or >8% |
Total Schools |
%age |
18/19 nos. |
18/19 %age |
Nursery |
0 |
2 |
0% |
1 |
50% |
Primary |
6 |
50 |
12% |
10 |
20% |
Secondary |
1 |
7 |
14% |
0 |
0% |
Special |
0 |
4 |
0% |
1 |
20% |
Total |
7 |
63 |
11% |
12 |
19% |
The balances above the threshold are £0 in Nursery, £402,465 in Primary, £118,211 in Secondary and £0 in Special – totalling £520,676 a decrease of 4% compared to 2018/19. (In 2018/19, the balances above the threshold were £15,697 in Nursery, £511,084 in Primary, £0 in Secondary and £14,563 in Special – totalling £541,344).
During 2011 we agreed that any excessive balance would be discussed as part of conversations between the school and the local authority focussing around good use of resources and the needs of the pupils at the school.
3.2 Letters were sent to the 7 schools identified, asking 6 questions.
|
Question |
1 |
Please provide details of why the balance either: a. has been consistently high over the last 2/3 years b. is over 5/8% for 2019/20 |
2 |
What are the school’s plans to invest surplus balances to ensure they keep within the 5/8% threshold? |
3 |
How are you planning to use your resources to address school priorities identified in the School Development Plan and the areas for development identified in the school’s last Ofsted report? |
4 |
For schools judged to be outstanding, how will surplus balances be used to maintain this judgement? In particular, as outstanding schools are expected to support other schools to improve, how could surplus balances be used to fund this activity? |
5 |
How will you ensure you can spend some of your surplus without threatening the long-term financial position of the school, but also increase the attainment of your pupils in line with your priorities? |
6 |
Please describe strategic discussions by the Governing Body about the use of surplus balances and provide minutes where this discussion is recorded. |
3.3 Responses were received from all the schools.
3.4 The themes of the responses from those schools were;
- Planned building works/school expansion cancelled or delayed due to inclement weather in February and due to the impact of Covid 19.
- To fund Health and Safety upgrades planned to take place in 2020-21.
- Revenue contributions to planned building and renovation projects
- Planning to cover expected budget deficits in years 2 & 3
- Unexpected refunds received towards the end of the financial year, and an increase in the level of catering income to that budgeted.
- A buffer to allow time for staffing restructure to be undertaken.
- An uncertain future composition of the school – possibility of merger.
- For school improvement.
- Previous years’ carryforwards set up to fund future years’ expected budget problems.
3.5 After consideration of the responses received, the council has not determined to reclaim any additional balance this year.