ColegauCymru annual conference Cutting costs – improving efficiency ColegauCymru annual conference 27 May 2010 Workshop
Finance Directors Group Meeting the challenge
What is the challenge ?
“Our budget next year will be the toughest ever faced “Our budget next year will be the toughest ever faced. We are planning to make cuts of 3% in revenue and 10% in capital. It will be the same next year and the year after.”
What is the challenge Mid Year Forecast 2009/10 5% Total Income £426m WAG Grant £344m £17m Total expenditure (excl Depn) £402m £20m Capital (excl grants) £19m £1m Surplus £2.6m
It’s not just funding cuts Change 2009/10 – 2013/14 WAG Income (£12m) Pay awards £38m LGPS £7m Inflation £11m VAT £4m Net change £72m 18% of 2009/10 expenditure
“something better change”
How would the private sector address this
How will FE approach these cuts
Cutting costs is easy……. Saving LRC 50% £824k Staff dev 75% £742k Marketing £1.2m Maintenance £8.4m Computers Defer 1 yr £3.8m Non lecturing staff overtime ban £1.3m Total saving £16.3m
The above account for 81% of non pay spend What is there to cut ……. Non pay spend Sector spend Admin and central services £19.2m Premises – running costs £17.2m Teaching dept materials £16.1m Exam fees £11.6m Premises – maintenance £11.2m Franchise provision Student transport £8.4m The above account for 81% of non pay spend
“Back office” functions ……. Staff costs Sector spend Finance £5.3m IT £4.7m HR £3.2m MIS £3.9m Total cost £17.1m PWC high end 15% saving over three years = £7.7m (Less £1m – pay increments over period)
Is it all up to us ? - WAG - LEAs - Schools - Unions
Workshop topics - “the BIG idea” - “REAL” collaboration - Income Generation - Efficiency gains