Memorandum submitted by Peter Lowe, Head
of Finance, Children's Services, Bury Metropolitan Borough Council
1. SCHOOLS' FUNDING
Bury schools are amongst the poorest funded
in England in Formula Spending Shares (FSS) and have to heavily
rely on additional funds from local taxation.
The new Dedicated Schools Grant (DSG) will use
the Schools Block, which is based on the Schools FSS and the amount
of local resources.
Consideration is being given to aggregating
these resources and eventually distributing them to all authorities
to ensure that DSG funding for each authority will be at least
at their former Schools FSS level.
Despite not distributing their funding at FSS
levels many of these authorities have more than enough resources
to fund their schools, in per pupil terms, at much higher levels
than schools in other areas that are heavily reliant on additional
funds from local taxation.
By re-distributing these funds via the DSG to
ensure that local authorities allocate at least at their former
Schools FSS levels can only be viewed as "robbing the poor
to give to the rich".
Many schools that are in poorly funded areas
would view the re-distribution of funds away from them into already
cash-rich schools as educationally damaging.
The funding proposals outlined in the DfES'
letter of 21 July 2005 (Ref: LEA-1662-2005) indicated that the
DSG for 2006-07 and 2007-08 will increase by 6% each year, while
each authority will receive a minimum 5% per pupil increase in
its DSG allocation.
This incremental approach adds a much smaller
monetary amount to those schools that are funded at the lower
end of the league tables while their much cash-richer neighbours
will receive a larger increase to meet all the demands all schools
face. For instance many Bury schools will struggle to fulfil the
"Workforce Reforms" because of a lack of resources.
Our funding levels are so poor that nearly all Bury schools have
to use their Schools Standards Grant to support their basic education
provision.
Ofsted and the Audit Commission are consistently
encouraging the Authority to adopt Policy-led or Priority-based
budgeting rather than an Incremental Budgeting system. This is
difficult to achieve when the main allocation methodology is so
heavily reliant on an annual per pupil percentage increase.
As there is a gap between the 6% increase in
the DSG quantum and the minimum 5% per pupil increase, could these
"headroom monies" be utilised to give an increase in
the basic entitlement funding per pupil supplemented by a percentage
increase? This would ensure that local resources would not be
distributed elsewhere and would help to narrow the funding gap
between the "haves" and the "have-nots".
2. PUPIL REFERRAL
UNITS (PRUS)
For all intents and purposes, PRUs are viewed
as schools and will fall within the auspices of the Schools Forum
when they recommend allocating resources to the "Central
Spend within the Schools Block". PRUs have their own DfES
school number, they receive various grants such as Schools Standards
Grants, Standards Fund and Threshold Payments, but they do not
have the same financial management benefits as schools with delegated
budgets. Nor are they allowed to be members of the Schools Forum.
Could consideration be given to changing the
status of the PRU's so they can at least benefit from the use
of balances at the end of the financial year rather than having
to rely on the authority and the Schools Forum as to what happens
to their devolved resources?
3. SCHOOL BASED
BANK ACCOUNTS
Although schools are empowered to pay all their
own bills and salaries through their own bank account, could an
explanation be given as to the rationale and benefits to schools
of these transactional arrangements?
Because of the increased stewardship that managing
a school bank account brings, schools are taking on more back-office
staff at increasing salaries to meet their processing obligations.
Is this the best use of scarce educational resources and placing
an additional burden of bureaucracy on schools that we are all
trying to reduce?
In these days of sophisticated financial Management
Information Systems, such as Agresso (as chosen by the DfES),
is the promotion of school based bank accounts appropriate?
Where Agresso has been implemented in schools
those schools have chosen to relinquish their separate bank accounts
preferring the improved financial management information rather
than the cumbersome transactional processes they have to be involved
with when having their own bank account. Consequently should authorities
be criticised by Ofsted and the Audit Commission for not actively
promoting school-based bank accounts?
4. STUDENT FINANCE
At the moment local authorities are generally
the first port of call for student finance and despite a number
of difficulties with the introduction of the computer systems
most things are functioning properly.
The latest proposals are to introduce centralised
pilot schemes to see if services can be provided more effectively.
Although these are not fully operational a number of issues need
to be carefully considered.
It is understood that some functions would be
retained within local authorities but if there is centralisation
surely local skills and knowledge would disappear. When there
is a problem who would students refer their problems to? If they
are still uncertain or wish to take the matter further say by
writing to their local Councillor or constituency MP how would
they take up the problem? At the moment by having local offices
it is much easier for elected representatives to resolve the problem.
Public services need to be local rather than being dealt with
by someone hundreds of miles away.
The five main points outlined in the 7 June
2005 statement are achievable by local people serving local students'
needs. A Service Level Agreement that is agreed to by all would
be a more effective model than centralisation.
September 2005
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