Financial sustainability of schools in England – Report Summary

This is a House of Commons Committee report, with recommendations to government. The Government has two months to respond.

Author: Committee of Public Accounts

Related inquiry: Financial Sustainability of Schools in England

Date Published: 4 March 2022

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The Department for Education asserts that overall the school system is in good financial health. The most recent available data show that 88% of maintained schools and 93% of academy trusts in England are in surplus. But these national figures mask significant variation and challenges for individual schools. While the Department asserts from its global figures that schools have coped well with financial pressures it lacks the curiosity needed to find out what is actually happening at local level and why.

We remain concerned about the financial sustainability of the school system and about how more deprived schools, measured by proportion of children eligible for free school meals, are faring worse than less deprived schools under the Department’s new funding system. The Government has committed an extra £4.7 billion for school funding as part of the 2021 Spending Review. But the Department has little assurance that this will be enough to cover cost pressures (including the impact of the COVID-19 pandemic) and deliver its ambition to achieve better outcomes for children.

Some of the steps that schools have needed to take in recent years to remain financially sustainable have adversely affected children’s education. This includes schools that have cut staff, dropped certain subjects from the curriculum, and reduced support for pupils with special educational needs and disabilities (SEND) in response to financial pressures. The Department needs to recognise that these actions have an impact on the quality and breadth of the education that children receive.