Agenda item

Report ED12039

The Sub-Committee considered a report setting out all revenue and capital balances held by Primary, Secondary and Special Maintained Schools as at 31^st March 2012, and also providing a comparison to the balances held at the same time in the previous year. 

In considering spending by Primary, Secondary and Special Maintained Schools in 2011/12, the Chairman highlighted the recent consultation undertaken by the Department for Education to ensure that local authorities were working closely with schools with deficits of 2.5% or more and surplus balances in BO1 and BO2 of 15% of more.  The Head of Schools Finance Support confirmed that no further guidance had yet been issued around the role the Department for Education would take to ensure schools were supported in reducing deficits or surplus balances.

It was noted that all schools with high level balances had now provided a response to the Local Authority and plans for management action had been put in place by each school to reduce the balances held.  The Local Authority was also working with schools to ensure that expenditure plans were incorporated into the school budget.  Details of the management action being taken to reduce balances had now been received from Manor Oak Primary School and would be circulated to Members of the Sub-Committee.

Councillor Nicholas Bennett highlighted that the uncommitted revenue surplus at Chislehurst (St Nicholas) CE Primary School was largely a result of funding held back by the school due to possible relocation to a new site.  The Portfolio Holder confirmed that the potential relocation was still under consideration but that no decision had yet been made.

In response to a question from a Member, the Head of Schools Finance Support confirmed that the Local Authority monitored school budgets and if serious issues were identified, a notice of concern could be issued to the school which enabled the Local Authority to put controls in place and become more involved with decision making.  Work would be undertaken with the Governing Body to implement a solution, and if this was not achieved in a set period of time, delegated funding could be withdrawn.  Maintained schools with deficits were also required to sign up to the Gold level Financial Services Service Level Agreement offered by the Local Authority which provided advice and support on financial matters.

The Chairman queried what would happen to the deficit held by Hillside Primary School when it converted to sponsored academy status in September 2012.  The Head of Schools Finance Support confirmed that schools which converted as sponsored academies were able to retain any Revenue surplus but that any deficit returned to the Local Authority.  Work had been undertaken with Hillside Primary School to reduce the deficit held prior to conversion and funding had been identified within the Dedicated Schools Grant headroom to absorb any remaining cost to the Local Authority.  It was noted that deficits held by other schools moving to sponsored academy status would similarly return to the Local Authority however the two schools currently identified as sponsored transfers both had surplus balances.

RESOLVED that the financial position of Primary, Secondary and Special Maintained Schools at the end of the 2011/12 financial year be noted.