6 minute read
SKILLS
How the pandemic has transformed academies’ finances
School finances were already in a challenging situation but the past year’s events have been put them under unusual stresses and strains. Rachel Barrett (pictured), director and head of academies at Duncan & Toplis, explains the impact using insights from a new report by the East Midlands chartered accountants.
Each year, Duncan & Toplis co-authors a major report into the finances of almost 1,400 academy schools in 300 academy trusts across the UK.
The Kreston Academies Benchmarking Report represents the finances of 15% of all academy schools in the UK, making it one of the largest surveys of its kind.
Since 2018/19, most academies have turned a budget surplus and last year, the number of trusts in cumulative deficit fell from 8% to just 5% during the last school year.
That schools were still able to turn a surplus at all during the last academic year may come as a surprise, but the disruption from Covid-19 only really began during the final months of the last school year, from the point when schools were first closed on 20 March.
Another important point is that, paradoxically, the period of the greatest disruption created the greatest opportunities for savings when it comes to school budgets: While closed, they were able to reduce the cost of staffing, maintenance and utilities, using savings to cover additional costs elsewhere.
Because secondary schools were closed for longer than primaries, their financial performance improved the most, with average surpluses excluding capital income rising from an average of £13,011 to more than £147,000.
TECHNOLOGY AND SUPPLIER COSTS
As was widely reported, a major barrier during the lockdowns has been inequality in the technology needed for remote learning.
This has meant significant differences between schools, with some able to switch to online delivery almost overnight, while others struggled to secure the tools they needed, particularly in deprived communities.
This meant some schools had to rapidly make large investments in technology, while others were able to make fewer new purchases.
Schools also needed to consider issues around their suppliers, caterers and contractors, with difficult questions consuming management time.
FINANCIAL CHALLENGES AHEAD
Looking at the current year, we can use some of these findings to anticipate the financial situations schools will be facing today, including the costs of reopening schools and making them Covid-secure.
In terms of remote learning, a survey we conducted in December showed 85% of schools increased IT spending in 2020/21.
Although it may feel like it’s been a year of lockdowns, schools have largely remained open throughout the 2020/21 academic year.
The consequence of this is that schools have had to shoulder the added costs of maintaining Covid security while remaining fully open for far longer than they did last year. As a result, the costs of extra cleaning, additional staffing and suppliers to cover higher levels of staff absence will have risen.
Fortunately, schools are being supported with the additional costs they face. The Government has allocated support schemes such as the Recovery Premium, funding to cover exceptional costs associated with coronavirus, and a £2.2bn increase in school funding for schools that should increase most local authority allocations by 3%.
However, many are retrospectively awarded, meaning schools must shoulder the immediate costs before claiming back for reimbursement.
Many schools have also been unable to access these funds, either because the claim criteria is too narrow or because they are expected to use up their reserves before claiming for Government support.
Very few schools we surveyed had made successful claims at the time of publication and even fewer had been reimbursed for their total additional spend. The challenges, exceptional costs and complications for academies across the UK continue to mount and we will have to wait and see just how badly school finances have been affected.
New town centre hub will boost careers
A Careers and Enterprise Hub has opened its doors in the heart of Loughborough to help people enhance their skills to access the jobs market, progress in their existing careers or launch a new business idea.
The hub, which is run by specialist advisers from Loughborough College and Loughborough University, will offer advice to people about education and training pathways to boost their skills.
It opened last month after Charnwood Borough Council purchased the building with help from a £750,000 funding boost via the Loughborough Town Deal.
Jo Maher, principal and CEO of Loughborough College, said it would “help unlock the potential and career aspirations of local people in our community”.
She added: “The Careers and Enterprise Hub perfectly positions the college to support the town’s skills-led recovery from Covid-19.”
A Loughborough University team will provide expert support to aspiring entrepreneurs looking to launch a new business.
Loughborough University’s Professor Chris Rielly added: “The hub represents a really exciting opportunity to equip individuals with new skills, enabling them to build businesses which are ‘fit for the future’, agile, focused on emerging markets and committed to scaleup and growth.”
Experts in cyber and space technology are bidding to create a £13m “skills factory” in Leicestershire to revitalise the region’s economy.
The Leicester and Leicestershire Institute of Technology in Space, Digital, Advanced Manufacturing, Engineering and Propulsion aims to help plug the skills gap in the region and help the area recover from the effects of the pandemic, in which Leicester has remained in lockdown for longer than anywhere else in the UK.
The provision covers the agriculture dimension and the provision of alternative fuel-based propulsion.
Now the joint bid, which has the backing of the Chamber, has taken a step closer to reality after the Department for Education (DfE) chose it to go through to the next round of applications for one of eight new institutes of technology in the UK.
The bid is centred on the themes of space, advanced manufacturing and digital skills. It will offer training opportunities for local people, help employers to meet skills needs, create jobs, and boost growth and productivity in the local economy as well as supporting the delivery of specialist skills and education elsewhere in the UK.
The delivery partnership involves the University of Leicester, De Montfort University Leicester (DMU), Leicester College, The SMB Group (Stephenson College & Brooksby Melton College), North Warwickshire and South Leicestershire College, the National Space Centre and employers including Airbus, Reaction Engines and WSP Engineering.
Each partner will bring their expertise in areas such as digital skills, engineering, space technology and manufacturing, supporting the Government’s “levelling up” agenda.
Professor Nishan Canagarajah, president and vice-chancellor of the University of Leicester, said reaching the final stage of the Government’s bidding process “not only demonstrates the university’s long track record in space science and research, but our commitment to providing skills-based opportunities in Leicester and the surrounding region”.
DMU vice-chancellor Professor Katie Normington added: “To win this bid would mean being able to really use the training expertise we have at DMU as a regional leader in apprenticeship delivery to bolster the development of crucial digital skills throughout the region.
“By working with Leicestershire education partners, we will be able to provide a comprehensive, ideal range of experience to ensure this institute is a catalyst for economic growth and innovation into the future.”
The Leicester and Leicestershire Local Enterprise Partnership’s economic recovery plan identifies a lack of digital skills and belowaverage productivity levels as factors inhibiting the area’s growth.
The need for skilled jobs will only increase as plans progress to open a freeport in the East Midlands, creating an estimated 60,000 new skilled jobs for the region, with a focus on industrial strengths such as advanced manufacturing to boost competitiveness and spur local and regional economic growth.
The Leicester and Leicestershire Institute of Technology would have links to Space Park Leicester
