1. Finance – making the best of your resources budget planning, benchmarking, collaboration & seeking best value
Welcome

2. Aims
To consider how governing boards strategic and budget plan, to ensure the best use of school resources .
To look at the DfE tools available to help governing boards benchmark their school, and to achieve best value and efficiency.
To discuss how schools may collaborate with each other to share best practice and (possibly) resources.

3. A core governance responsibility is…
To oversee the financial performance of the school and make sure it is money well spent.

4. What does this mean?
Schools must be able to evidence – to their stakeholders and to the regulators - that they are spending their funds to achieve the best possible outcomes for the children, and that they are achieving value for money.
Every school has a delegated budget, to cover staff costs, running costs, maintenance and equipment. The governing board is responsible for this budget.

5. The budget - channels of income
The School’s Budget Share (Dedicated Schools’ Grant) Allocated by the local authority - for pupils aged Separate funding formula for 6th Form (16-19) funding
Other grants Given by the government to support specific initiatives and strategies (e.g. Pupil Premium Grant)
Other income Generated / sourced by the school: eg hall hire, parental voluntary contributions, donations from charities, grants for specific projects, PTA fundraising

6. Budget Planning
The governing board is responsible for producing and ratifying the annual budget plan (Academies: see your scheme of delegation: trust board <-> LGB)
The budget plan must have a clear link to the key educational priorities of the school (eg staffing and continuous professional development; cost of strategies / interventions)
What else should governors consider during budget planning?

7. Budget Planning considerations
Appraising different expenditure options
Taking account of findings from benchmarking
Efficiency considerations.
Obtaining best value (eg for large purchases, external contracts and service agreements)
Future staffing – upcoming changes and needs
Planning for sustainability (3 year plan) .

8. Budget Planning considerations
Are resources (including staffing) being allocated in line with current key priorities?
Does the budget plan identify spending / saving opportunities… and risks?
Does the school have sufficient reserves to cover any major changes (eg restructuring) and have any risks been identified?
How can better value for money be achieved from the budget? .

9. The Review of Efficiency in the Schools System (June 2013): key findings
The most efficient schools:
Deploy the workforce effectively, with a focus on developing high quality teachers
Make use of evidence to determine the right mix of teaching and education support staff
Employ or have access to financial expertise…

10. In-school financial expertise
Schools need access to staff with a high level of financial management competency because of the complexity of financial management issues in schools.
As governors/trustees are responsible for the effective use of funding delegated to the school, it is vitally important that they are confident that the school has access to appropriate financial expertise.

11. The Review of Efficiency in the Schools System (June 2013): key findings continued
The most efficient schools:
Make good use of financial benchmarking information to inform the school’s spending decisions
Make use of school clusters, sharing expertise, experience and data, as well as accessing economies of scale when making shared purchases
Have in place a strong governing body and leadership team that challenges the school’s spending

12. Financial benchmarking
How does your spending on teaching staff compare to similar schools?
How does your spending on other staff compare to similar schools?
How does your spending on goods and services compare to similar schools?

13. Schools financial benchmarking service

14. Schools financial benchmarking service
Benchmarking doesn’t answer questions – it raises areas for exploration.

15. Managing our school’s financial health
How do we know whether our school/trust is financially healthy?
What materials and tools are available to help?
School Resource Management – DfE’s online toolkit

16. School resource management toolkit
Produced by DfE and Education and Skills Funding Agency and contains:
Buying for schools guide, and case studies
Get started with school resource management checklist
Review and benchmark your finances
Plan your workforce and curriculum
Guidance for governors: what checks to make
Get financial advice for your school
School resource management training & peer support

17. Top 10 planning checks for governors
Part of the School Resource Management toolkit.
Use as a starting point for discussion with the SLT / governing board.

18. Top 10 planning checks for governors

19. Points 1-5: Staffing matters
This is where most of your budget is spent.
Are you spending enough?
Are you spending wisely?
Are your staffing arrangements set up to make the best possible positive difference in the key priority areas?

20. Staffing – key data
Governors should be able to scrutinise data on:
How much their school is spending on teachers and on support staff
The ratio of teachers to support staff
Pupil-teacher ratios (PTRs)

21. Staffing – strategic planning
Use the Top 10 Planning Checks for Governors to prompt SLT/governing board discussion.
Review the staffing structure regularly – have we got the right balance? How well does our structure match with what’s needed to deliver our curriculum and to address our school’s key priority improvement areas?
Ensure that decisions are informed by the evidence, as collated by the Education Endowment Foundation (eg EEF Teaching & Learning Toolkit)

22. Staffing – strategic planning
Reviewing our appointments process – do we have a good track record of making the right appointments?
Reviewing our use of the Teachers’ Pay Reform – does our pay policy support our strategic aims?

23. Point 7: 3-5 year budget projections
Same process as setting a one year budget plan
Should start from a blank page
Consider school improvement priorities
Estimate pupil numbers
Consider curriculum needs
Consider premises needs
Will any capital programmes affect the budget?
How will external factors impact our income or costs?

24. Setting the 3 year budget plan:
Likely staff costs
Pupil numbers
Budget changes
Long term commitments
Continuous review
3 year plan and school priorities

25. Point 8: Procurement and contracts
Does our school have effective procurement processes?
Does our school make use of available procurement services?
Can we increase the procurement knowledge within the school?
Does our school benefit from economies of scale?

26. School and trust collaborations
Table discussion:
What opportunities are there for your school to engage in joint procurement activities with other schools?
What are the challenges to joint procurement activities with other schools?
Does your school share staff/expertise/training with other schools?
Has your governing body discussed collaborative working? – What could this look like?

27. Reviewing efficiency
Three key questions:
Foundations – does the school have access to appropriate business management skills?
Practice – are effective processes, procedures and practices in place to promote efficiency?
Culture – is there an efficiency culture which permeates the whole school community?

28. Creating an efficiency culture
Make the link between spending decisions and pupil outcomes…. better spending decisions can help to raise attainment
Establish efficiency as a norm…….once we become aware that other organisations are more efficient we tend to change our behaviours
Require the use of information…..and ensure that your school uses all of the information available to it
Challenge inefficiency…..this may be time-consuming and involve risks but will often bring long term gains

29. Schools financial efficiency metric tool

30. Schools financial efficiency metric tool
Lists schools with similar SEN and FSM as your efficiency neighbours
Efficiency decile 1 = most efficient decile 10 = least efficient

31. What could be our next steps?
Conduct an internal review – using the Top 10 planning checks for governors, financial benchmarking and the efficiency metric.
Investigate what other schools are doing
Support your school to resolve those issues which are proving a barrier to becoming more financially healthy and efficient.

32. ??? Any questions? Clive.Haines@achievingforchildren.org.uk