Agenda item 9.1: Updates to the scheme for financing schools October 2020

Directed Revision by DfE April and August 2020

The changes relate to issues 11 and 12 of statutory guidance from the Department for Education (DfE) for local authorities on schemes for financing schools. It relates to Section 48 of the School Standards and Framework Act 1998, and Schedule 14 to the act.

Local authorities are required to publish schemes for financing schools setting out the financial relationship between them and the schools they maintain. This guidance lists the provisions which a local authority’s scheme must, should or may include. Schemes need not follow the format used in this guidance.

In making any changes to their schemes, local authorities must consult all maintained schools in their area and receive the approval of the members of their schools forum representing maintained schools. Local authorities must take this guidance into account when they revise their schemes, in consultation with the schools forum.

 

References below are to the section number in Issue 10 (June 2019) of this guidance.

DfE have made the following updates to reflect current policy positions and changes in legislation:

Paragraph 2.3.1: Provision of multi-year budget information

changed from “The LA requires schools to submit a financial forecast covering each year of a multi-year period for which schools have been notified of provisional budget shares beyond the current year” to “The LA requires schools to submit a financial forecast covering each year of a three year period for which schools have been notified of provisional budget shares”.

Paragraph 4.5: Planning for deficit balances

new paragraph 4.5b added “The Secretary of State has directed that with effect from 31st March 2021, schools must submit a recovery plan to the LA when their revenue deficit rises above 3% at 31st March of any year. (Local Authorities may set a lower threshold than 5% if they wish)”.

Paragraph 10: Insurance

changed to become 10.1 and new paragraph 10.2 added for Risk Protection Arrangement. “LA maintained schools may join the Secretary of State’s Risk Protection Arrangement (RPA) instead of taking out insurance, for risks covered by the RPA. Schools may do this individually when any insurance contract of which they are part expires. All primary and/or secondary maintained schools may join the RPA collectively by agreeing through the Schools Forum to de-delegate funding”.