Agenda item

To receive an information on school balances over the last 5 years.

The report was submitted by the Schools Group Accountant.

It was reported that individual schools' balance levels had been analysed for this Report. It was elaborated that the Authority's balances for schools had been noted up to 2017 so as to compare the current situation with the situation prior to COVID-19. It was explained that schools' balances had increased during the pandemic period and that this could be seen nationally. However, it was emphasised that those monies saved during the pandemic were currently being used up very quickly. It was confirmed that the report only contained a snapshot of the balances as they were constantly changing. As a consequence, anyone assessing them should be very aware of their fluctuating nature before making decisions.

Three primary and three secondary schools were confirmed to be in financial deficit by the end of the 2023/24 financial year. It was explained that this was a small proportion of schools in deficit compared to other Authorities. It was emphasised that Finance and Education services were working with those schools to resolve debt and to plan so that the schools were in a better financial position in the future. It was noted that this could be developmental work to be realised over a few years.

It was considered how much of the balances had contributed to the development of a budget for 2024/25. An example was shared that most of the balances were earmarked as a large part of the following year's budget, resulting in a net low balance at the end of the financial year. In response, the Schools Group Accountant emphasised that the figures shown in the report were an update at the end of the financial year acknowledging that a large proportion of the funds were used for the establishment of new budgets on 1 April annually.

Secondary school balances were highlighted, and it was identified that different patterns could be found within the schools. It was noted that some schools' balances grew annually and others were using their balances more, resulting in relatively consistent figures on an annual basis. In response to the comments, the Schools Group Accountant confirmed that this stemmed from schools' individual plans and the needs that they had prioritised. It was also explained that an increase in staff numbers through temporary contracts during the pandemic had led to an increase in school staff across the county. It was elaborated that a large number of those contracts had now expired and in general there were fewer staff in schools. This was seen as having an impact on schools as fewer people were employed there but it helped them to stay within their budget.

A report on Ysgol y Moelwyn's balances was provided, noting that theirs had increased significantly in recent years. It was emphasised that there was no difference between this school and other schools in the county and it was not favoured in any way, except for local arrangements where the school was responsible for the public swimming pool. It was noted that officers would be in discussions with the school shortly to discuss their success with the balances so as to share good practice and strategies, if possible, with other schools in the County.

It was noted that in the past there was a requirement for schools with higher balances to spend these. However, it was thought prudent not to do so for schools with high balances at present as the information evidenced how quickly schools' situations could deteriorate. Instead, the emphasis should be on headteachers ensuring that the schools were scrupulously protected through the current period of financial uncertainty.

The need to look at these balances and compare them with the schools' pupil numbers was explained, to assess whether the largest schools had to make greater use of reserve balances to avoid debt, while the smaller schools could be run without using the balances.

It was assumed that schools' total balances would decline by the end of the current financial year to approach approximately £4million, returning to the position seen before the pandemic.

RESOLVED:

·       To accept the report, noting the observations made during the discussion.

·       To receive a further update at the next meeting comparing school balances with pupil numbers. It was agreed to accept the total balances as a percentage of the schools' full budget as part of this report.