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Two thirds of schools making 'significant' cuts

NAHT 'Breaking Point' survey of school finances, shows schools cutting down on equipment, maintenance and TAs due to cash crisis

Posted by Stephanie Broad | November 06, 2015 | Law, finance, HR

New figures released today by the National Association of Head Teachers (NAHT) show that nearly two thirds of school leaders (64%) are making ‘significant’ cuts or dipping into reserves to stave off deficits. Four in five school leaders (82%) said that budget cuts would have a negative impact on standards.

Russell Hobby, NAHT general secretary, said: “Flat cash education spending at a time of rising costs is pushing many schools closer to breaking point. Employer costs for national insurance and teachers’ pensions will increase by over five per cent from this school year, adding to already over-stretched budgets. School leaders are being forced to cut spending in all areas, including essential maintenance (50%) and – most worryingly – on teachers and teaching assistants (49%).” 

Source: NAHT Breaking Point report

NAHT’s review of 1069 school leaders, 17% of which were academies and free schools, found that:

  • Almost half of school leaders (45%) thought their budget would be untenable on current projections within two years
  • Two thirds (67%) said they would not be able to balance the books in four years’ time
  • Seven per cent of those surveyed were already running a deficit

Mr Hobby continued: “The money coming into schools is not keeping up with the expenditure they face. As the IFS pointed out recently, the government's funding commitment equates to the first real terms cut in education spending since the 1990s. Education is an investment in the future, leading eventually to higher productivity, better social outcomes and reduced spending on other public services; cuts to this budget are a false economy.”

Source: NAHT Breaking Point report

The report suggests the government needs to match the overall level of funding to the real cost pressures in schools, including meeting the shortfalls in funding for early years, sixth forms and for services previously provided by local authorities.

Other proposals include: 

  • A ‘fair national funding formula’ to ensure that limited funds go where they are most needed
  • Children eligible for the Pupil Premium should be registered automatically, rather than forcing schools to discover their eligibility. This could increase take up significantly and reduce administrative workload.
  • Investing in the further development of school business managers, who can help schools navigate this difficult territory. This includes a genuine freedom for schools to pay business managers at a level commensurate with the leadership pay scales in order to attract and retain their expertise.

Sue Adams, School Business Manager at Bower Park Academy, summarised the effect the current budget climate is having: “This has been one of the most challenging budgets that the Academy has put together for a long time, due to budget cuts from government and increases in employers NI and pension contributions just as an example. These increases are not covered by the income we receive from the EFA.

“Schools are tasked to deliver the minimum standard of good which means that good or outstanding teachers must be retained or recruited and this has a major impact on school budgets as staffing costs are at the top of all Academies financial considerations. Good teachers, cost, it’s a simple fact of life. Schools that are struggling financially are often not able to secure/attract outstanding teachers. 

“We were a designated ‘Building schools for the future’ school when the change of government happened - our new school was taken away from us and replaced with nothing. Until we became an academy, we had no money to do any necessary repairs to things such as rooves. However the capital programme isn’t enough, the government should look again at the criteria it is using for deciding who should have investment and what. We have been in the position of do we replace a leaking roof or upgrade an ICT suite?

“With the impact of the budget cut (this is actually what it is) then we are often in a situation of a rock or a hard place.”

Simon Hill, Managing Director at YPO, said: “The ‘Breaking Point’ figures released by the National Association of Head Teachers (NAHT) reinforce the importance of achieving maximum value from already stretched budgets. Cash-strapped schools are looking to save money by reducing investment in school resources, which could have an impact on teaching standards. Investment in resources is important to help teachers deliver engaging and interesting lessons and ensure pupils remain motivated. By exploring ways to buy smarter, schools can still purchase good quality resources without the need for significant levels of investment.


“The NAHT’s recommendation to invest in the development of school business managers is a positive step forward. In our experience, school business managers frequently have responsibility for key areas of school management, including the procurement of essential services and ongoing contract management. It is important that this role has the right level of expertise and knowledge to enable them to manage these responsibilities effectively, which ultimately have the potential to deliver significant and long term cost savings for schools.” 

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