Page last updated at 11:02 GMT, Wednesday, 25 February 2009

School surplus 'deprives pupils'

More than a third of schools allegedly have excess surpluses

Children are losing out on their funding entitlement because schools are holding too much money in reserve, claims a teachers' union.

Schools in England held surpluses of 2bn at the end of the last school year show annual figures, an increase of almost 15% on the previous year.

The National Association of Schoolmasters Union of Women Teachers (NASUWT) says this is "unacceptable".

But head teachers say there is a lack of clarity that needs resolving.


While schools are expected to keep a small reserve for unexpected spending requirements, anything above 5% of annual income for secondary schools and 8% for primaries is considered an "excessive" surplus.

Annual figures show that 38% of England's schools fell into this category, holding 592m in excess surpluses.

"The government believes that the national total of revenue balances and in particular the level of surplus held by some individual schools is too high," said Schools Minister Jim Knight.

There has already been a threat to claw back some of this excess if it has not been lowered by 2010-11 - though ministers dropped plans to act sooner.

Chris Keates, NASUWT general secretary, said that the amount held by some schools was "scandalous".

She said the holding back of money represented "the deprivation of youngsters of their full, in-year, per capita entitlements".

"The point which is missed consistently by those who seek to defend the stockpiling of public money is that these funds are allocated each year to be spent on the pupils, not on either saving for a rainy day or to fund some state-of-the-art building project," she said.

'Lack of definition'

But the National Association of Head Teachers (NAHT) said there were underlying issues.

Having received repeated warnings that budgets were about to get tighter, many schools had acted to protect services and facilities valued by parents and pupils from the ever changing financial climate.

The total balances included elements committed to specific projects as well as planned expenditure aimed at minimising disruption to staffing and pupil provision.

The multi-year budget process recently put in place for schools could justifiably result in an apparent increase in balances which might well resolve itself over time.

"School Leaders, especially those working in some of Britain's most disadvantaged areas, understand that whole school improvement, for staff and students, requires long term planning and a degree of financial stability rather than the hand-to-mouth existence promoted by some."

The overall surplus was less than 8% of the total budget, well within the notional contingency allocation approved by the Audit Commission, it said.

NAHT general secretary Mick Brookes said: "It is high time that this ongoing saga of school balances is resolved.

"There is lack of definition about the nature of these unspent funds.

"We suspect that much of this money is properly allocated and the amount of cash lying idle is minimal."

Does this issue affect your school? Are you hoarding - or saving prudently? If you are a parent, do you even know the state of your children's school's finances? How much money does the PTA contribute? Send us your thoughts using the form below:

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