To consider the report of the Head of Financial Services and the WAO Review into Education Finance.
Minutes:
Documents:
· Report of the Head of Financial Services
· WAO – Review of Education Finance (Powys County Council)
Discussion:
· The Chair informed the Committee that a joint working group had been set up between Audit Committee and the Education Scrutiny Working Group to consider the financial viability of schools. The Chair, Vice Chair and Councillor H Hulme were the representatives of the Audit Committee.
· The review concluded that improvements had been made but that there were further improvements that could be made
· Officers had been fully involved throughout the review
· A detailed action plan would be provided for the next meeting of the Audit Committee which would detail milestones. It was essential that this actively address driving the service forward.
· The Portfolio Holder confirmed that the report reflected the current position
· It was crucial that advice was provided early
· There needed to be a ‘reality check’ in some areas
· Challenge was needed across many support services
· The curriculum that could be provided at a school of 600 pupils was radically different to that which could be provided at a school of 400 pupils
· Deficits had accrued due to a number of factors including school and staffing structures together with a curriculum that must be suitable and deliverable and not aspirational
· The number of special responsibility payments could affect the budget significantly – these too, must be sustainable
· The Portfolio Holder was aware of some teaching staff undertaking pastoral roles for which they may not be trained
· The wide variation between schools’ financial positions was also an area for further investigation
· It was noted that the Welsh Government was to make additional funding available for Business Managers in schools and the Portfolio Holder urged the Authority to take advantage of this
· Schools need to have an understanding of both finance and the curriculum and the Portfolio Holder believed that this was an area for improvement
· The Chair noted that the WAO had reported in 2012, Price Waterhouse Coopers in 2015 and the Auditor General had also raised concerns but it did not appear that these had been acted upon. Schools had also been encouraged to balance their budgets but that this was insufficient in some cases.
· The Portfolio Holder was aware of the issues and stated her intention to remove delegation from those schools which did not co-operate. However the need for curriculum enabled officers to be in place prior to removing delegation was noted. It was essential to demonstrate fiscal prudence and there was a duty to enforce rules and regulations.
· The Committee remained concerned that the longer issues took to resolve, the greater the financial risk
· The Portfolio Holder acknowledged that support had been given to schools but the main concern was with those schools which have had assistance but have still not taken action to address budget issues
· School modernisation has been used as an excuse for not actively dealing with budgets but it was acknowledged that modernisation was a lengthy process and the current structure must be made to be viable.
· The Section 151 Officer advised that a two pronged approach was needed – financial and curriculum. Challenge Advisers need to ensure that the curriculum is affordable, right for the learner and deliverable. He reiterated the resourcing implications of withdrawing delegation but believed this should be tackled if appropriate to ensure the Authority maintains credibility.
· Members asked if Finance Officers could be sent into schools to try to redress budget deficits – the Portfolio Holder confirmed that this did happen but that governance issues must also be correct. A Governing Body should not allow a deficit budget to be set.
· The right support needs to be provided to schools, but the Governing Body must also take responsibility. LEA governors in particular should make strenuous efforts to bring deficit budgets back on course.
· Secondary schools employ Bursars or Business Managers but the roles and capabilities vary across the county. Long term planning is required.
· Finance Officers are on site a minimum of twice a year. Surgery sessions are also held. Training for governors is provided. Officers are available for advice at any time.
· The Chair asked if there was a structure for responsibility of deficit budgets and was advised that this was the responsibility of the Governing Body
· The Committee asked whether a Bursar/Business Manager’s role had been specified or if it had developed over time, what their remit was in relation to feeder primary schools, whether specific training was provided for LEA governors and if there was any scope for support from the private sector. It was noted that the service provided by Bursars/Business Managers varied and the role has changed over time. LEA governors should represent the LEA but tend to empathise with schools and not discharge their responsibilities fully.
· The Portfolio Holder was of the opinion that there was potential to develop clusters or co-operative working in rural schools
· The right people with the right skills need to be in the right places
· The culture in schools will also need to be addressed
· The Portfolio Holder would welcome being alerted to emerging issues by LEA governors
· The driver for school funding was pupil numbers
· The curriculum must be foremost as this drives results. Skills are not in place in some schools but it is a fundamental requirement. Despite budget pressures, curricula have not been adjusted.
· Efficiencies would suggest teaching to larger class sizes but this could be difficult to achieve in some areas such as Welsh medium where numbers tend to be lower
· Some software is available for curriculum management which, whilst not ideal, could be helpful in drafting timetables
· The incoming Director of Education had commented that Powys was a data rich county
· Governing Bodies should assess how staff are being utilized and must focus on outcomes – there is a coefficient of work rate and effectiveness
· New ways of working need to be identified across schools to ensure effective delivery
· Dual stream would be ideal but schools need to work together with peripatetic teachers and distance learning also being considered
· The WAO report highlighted that like other predominantly rural authorities, the Council’s budgeted education expenditure per pupil is well above the Wales average. However, the delegation rate is among the lowest in Wales with the result that delegated budgets per pupil in primary and secondary schools are below average, and well below those in similar authorities.
· ALN will be reviewed
· The effectiveness of the non-delegated budget will be assessed
· Members asked if the business community could be involved to offer a commercial perspective to schools – the Portfolio Holder thought that additional skills in Governing Bodies would enhance that role
· The Portfolio Holder noted that morale in schools could be improved – teachers away due to stress is of concern and the incoming Director of Education has been asked to undertake an investigation into the causes of stress in the workplace
· Some senior leadership teams in schools are reluctant to change
· The WAO stated that their report emphasised accountability for those within schools but also for the Local Authority
· The Portfolio Holder would consider withdrawing delegation after consideration of a school’s history – some may have failed to balance their budget but have taken mitigating action. Others have failed to introduce mitigation despite assistance.
· Whilst much has happened the pace of change has not been adequate
· The Portfolio Holder outlined her vision of changing the school structure consensually through closer working with communities.
· It was noted that the gross budget was ranked 6th in Wales but the retained budget ranked 18th across Wales. Transport costs per pupil were £513 and ALN £243. £1.8M was paid to Freedom Leisure for swimming facilities per annum. The Portfolio Holder noted the high cost of ALN provision and outlined her proposals for improved services whilst reducing costs.
· The Chair highlighted the need for a clear, written vision, going forward for all Portfolio areas for the next 5 years. The Portfolio Holder agreed but had been reluctant to commit to discussions prior to a meeting with the Minister. Clear proposals will be developed over the summer, and the Chair requested that costs be included.
Outcome:
· A clear direction of travel, including costs, to be developed in the near future
Supporting documents: