“It is in order to get the maximum value from every pound we spend on the school system that I am taking the unprecedented step of promoting a national debate with schools, school leaders and their colleagues about what steps we can all take to ensure the best use of our school resources in the coming years. I see this as a way of improving the tools schools have available to them for securing greater efficiency, not the creation of a top-down menu of near-instructions. The aim is to help and support, not to direct.”
The Secretary of State for Education
Speaking at the Specialist Schools and Academies Trust annual conference (SSAT), the Secretary of State for Schools challenged the schools sector to have an honest and vigorous debate about making the best use of resources in the face of more challenging public finances.
The speech reveals (often through a sub-text, sometimes through omission) exactly where and how school money is going, and is in fact the key document that we can all use to guide our selling to schools.
He said that it was not for ministers to micromanage individual heads’ budgets but he pointed to a discussion document, Securing Our Future – Using Our Resources Well, which sets out four main areas which finances could be run more efficiently.
1. Greater value for money from sharper procurement, collective buying and better use of technology;
2. greater efficiency through the wider adoption of partnerships and shared services between schools;
3. stronger strategic financial planning – including through greater use of School Business Managers and more effective financial management skills;
4. more effective use of external advice, already available, in strengthening financial management – and setting out a clear future role for central and local government and expert School Improvement Partners in supporting frontline delivery.
He made no reference to the claw-back programme – rumours of which have been circulating for days, and it is possible to read into this that the government see claw-back (the reclaiming of money not used by a school in the designated financial year) as a major way of saving money in education next year.
Instead the secretary of state urged schools to use the support available now to help them make the right financial and investment decisions. This includes:
1. a free programme of financial consultancy support for every maintained school in England – giving schools tailored advice on planning and managing their workforce and management; strategic management; how schools can link with their neighbours; and more effective procurement;
2. proactively using the Department’s financial benchmarking service – which allows schools to compare their patterns of expenditure against schools operating in similar circumstances – with 10,000 schools already signed up;
3. tapping into the Department’s procurement advice and signing up to the online procurement trading system OPEN – already 54 local authorities are signed up and 10,400 schools expected to be using it within a year;
4. signing up to the Schools Recruitment Service, launched in October 2009 – an online system that helps to save schools time and money when recruiting permanent leadership, teaching and support staff;
5. using a new website, which signposts all the national resources available for schools – with clear case studies and to share expertise across the sector.
He announced that there would be a national event early in the new year for heads and local authorities, jointly led by the Department and National College for Leadership of Schools and Children’s Services, to draw together the sector’s collective financial expertise and experience – followed by series of regional and local events.
This is interestingly in contrast with the current reports coming from schools that report that no one but no one is being allowed to go on any course at all.
The smart meters announced will give ‘real-time’ digital read outs on how much electricity a building is using second-by-second – clearly demonstrating the impact of switching on and off individual pieces of electrical equipment, computers and lights on easy-to-read display monitors.
The move will be part of a major campaign launched early next year to cut (“slash” is the word the secretary of state used) demand for energy and change teachers and pupils’ behaviour in using electricity in every school in England – alongside ministers’ responses to their Zero Carbon Task Force’s final report, which will set out a clear roadmap to cutting carbon emissions in schools
Research by the Carbon Trust shows that smart meters and wider behavioural changes in using energy could see 10 to 15 per cent cuts in fuel bills – meaning the average one-form primary school could save up to £700 a year and the average 900-pupil secondary school more than £3,000 a year on fuel bills alone, potentially releasing millions of pounds across the entire system.
Ideas also at the front of the Secretary of State’s thinking include the opportunities for schools to work in federation; to use their collective buying power to get better procurement deals; to make the best use of money currently held in school balances and at how to spread best practice in the use of resources.
“It is in order to get the maximum value from every pound we spend on the school system that I am taking the unprecedented step of promoting a national debate with schools, school leaders and their colleagues about what steps we can all take to ensure the best use of our school resources in the coming years. I see this as a way of improving the tools schools have available to them for securing greater efficiency, not the creation of a top-down menu of near-instructions. The aim is to help and support, not to direct.”
Background
1. Securing Our Future – Using Our Resources Well is published at: http://publications.dcsf.gov.uk/default.aspx?PageFunction=productdetails&PageMode=publications&ProductId=DCSF-01097-2009&
2. The support package for schools includes:
• Free national consultancy programme for every maintained school in England – giving tailored, timely advice to schools that request help and guidance on how they can make the best use of their resources:
• Wider school workforce – how schools plan and manage their staffing;
• Leadership – how much time and experience school leaders have to focus on delivering value for money;
• Strategic management – how schools approach financial and resource management, including linking the two with school improvement;
• Collaboration and partnership – how schools work together – and with other organisations – to improve outcomes together;
• Challenge and Governance – the role of the Governing Body in supporting delivery of value for money; and
• Procurement performance – how schools approach procurement.
In this academic year a developed offer will be available to schools. Topics that are covered will remain the same but the delivery method will vary. One day consultancy support for an individual school is as offered before. However, an additional day of contract review is offered for those schools with particular issues with procurement; carrying out work on behalf of the Education Procurement Centre.
A tailored workshop is offered for a group of schools, usually within the same local authority which would focus on particular local issues and also encourage collaboration between schools.
A total of three days consultancy for schools is also offered in particularly challenging circumstances as identified by the local authority (this might be for example that the school is in, or is in danger of reaching a large deficit).
For more information please see: http://www.consultancyforschools.co.uk &
http://www.fmsis.info/news/?id=51
Procurement and Technology
Almost all procurement is currently done at individual school level and in some instances by individuals with limited procurement experience. Better procurement can lead to significant savings and more sustainable and better quality goods and services in schools, and given that some £7bn to 8bn is spent annually by schools on non-staff expenditure so potential savings are significant. Collective buying offers great scope for better value for money, and recent studies have shown potential in many areas – including ICT procurement, facilities management, energy contract, the use of supply agencies and photocopier contracts. DCSF has recently launched the OPEN online procurement platform to support schools’ in their procurement. To date 4000 schools have signed onto the system and 2600 schools are actively procuring through it. Savings derived from sharper procurement would be available for higher priority investment.
The huge investment of the last 12 years in information and communications technology in schools is an important area for review. In many schools the benefits realised from ICT are limited. Becta’s Harnessing Technology survey shows that only a quarter of all schools are using ICT effectively across all their business functions. Many other schools use technology imaginatively in some areas of their work such as tracking pupil progress, teaching in some subjects or communicating with parents. But in spite of some good practice, these schools are not deriving the full benefit. Becta’s self-evaluation framework gives schools a ready tool to help plan their use of technology more effectively to improve outcomes and efficiency. 16,000 schools have accessed the framework, and significant umbers are making progress. But better exploitation of ICT across the system would yield better outcomes at lower cost, especially where schools use it as a shared resource.
The use of energy needs to be considered alongside its cost to schools. Schools could achieve significant savings from energy reduction through simple changes in behaviour of those working and studying there. The Buildings Research Establishment (BRE) conservatively assessed opportunities for reducing energy demand from schools in 2006 and identified a number of management measure which can be implemented at little or no cost, such as good housekeeping practices associated with heating, lighting and general behaviour. BRE estimated that implementing these and other similar management measures could deliver 7 per cent on fuel bills for a typical primary school and between 4 and 7 per cent for second schools. With English schools spending over £400m pa, the savings are potentially significant.
Resource use and financial management
The White Paper makes clear that the better use of resources is essential to the implementation of the vision of the 21st Century School. As staffing on average absorbs about 80 per cent of schools’ budgets, the use and deployment of staff is a vital consideration in looking at effectiveness and efficiency in schools, as effective workforce remodelling shows. Many schools plan on an incremental basis building on historic plans. With budget constraints and ambitious aims for their pupils schools a more strategic look at the use of all their resources, human and material, to determine the optimum mix of resource for their circumstances is important. At the same time collaborative opportunities for getting better outcomes for their pupils and, where available, cost efficiencies in parallel should also be considered. Schools that fail to take a strategic view will find the delivery of their outcomes challenging.
Good financial planning needs skilled staff to support it, and schools have increasingly invested in higher levels of financial skills. Many secondary schools now have business managers, who bring expert skills in procurement and finance which National College research demonstrates can make a significant impact. Improvements though have been uneven: for example business managers are less common in primary schools, but we believe they have a real contribution to make there too, albeit often on a shared basis. The National College’s work shows that a business manager for a school or group of schools can realise initial savings very quickly, and often deliver a significant surplus over the cost of their salary through a combination of cost savings and additional income. Business managers have the time and expertise to look carefully at the way a school uses its resources in a way that the head and other senior managers cannot afford the time to do.
Partnerships and shared services
The White Paper places great emphasis on the improvements in outcomes for pupils that can arise from collaboration and federation. Schools are stronger when they work in partnership and are better able to meet all of their pupils needs. There are many benefits to schools from working in partnership and plenty of current examples of schools working together, for example on behaviour and sports or to increase the curriculum offer to pupils. Federations, hard or soft, allow our best leaders to share their knowledge and experience more widely across the school system, and are an important part of our approach to raising standards. We are currently consulting on a system of accreditation for providers seeking to run chains of schools.
Federations should always be driven by local need and circumstances and the first priority must always be to ask whether they will improve outcomes for children. We do not believe it is right for federations to be centrally mandated, but we do want to explore ways in which federations can be encouraged and in which increased collaboration can be facilitated. This is why we have asked the National College to develop a national Leadership Models and Partnership Programme, which will support schools and Local Authorities to develop fit for purpose approaches. The National College’s new models of leadership website (http://www.nationalcollege.org.uk/modelsofleadership) includes over 60 case studies of innovative and entrepreneurial leadership partnerships.
Federation has not primarily been driven by cost saving, but reduced costs can accompany improvements in outcomes, and must be welcome in a challenging environment for expenditure. There is firm evidence that opportunities for greater efficiency exist in federation and we want to ensure that this is maximised. The Audit Commission’s Valuable Lessons report published earlier this year found that:
“While there may be increased costs through federation – for example, increased travel and integration of computer systems – there can also be significant cost savings, for example by:
o making a broader curriculum more cost-effective;
o making joint appointments;
o achieving economies of scale, for example by aggregating purchasing; and
o saving on planning and administrative time. (para 63)”
The report identifies examples of revenue savings of between 2 and 6 per cent in secondary schools. Similarly, in small primary schools, the ‘Better Together’ research for DCSF published this year identified net savings from salaries of over £58,000 when an Executive Head was appointed across three small first schools.
Clearly the scope for savings from a federation depends on the way in which it is organised, as the case studies on federation show. We see federation as a growing trend in ensuring a better offer for pupils, and we need to derive savings from it where the design makes that possible.
Supporting schools – the role of local and national partners
School Improvement Partners
The White Paper clarifies the role and position of SIPs as the primary intermediary between schools and their LAs and as such key to interaction with schools. Their role is enhanced by the White Paper in parallel with a more devolved approach to school improvement. In particular the White Paper expects SIPs to have a wider role in brokering support. SIPs’ leverage over weaker performing schools will be increased by making part of these schools’ funding for improvement contingent on the SIP signing off their schools improvement plans, and ensuring there is appropriate investment in improvement priorities. The use of resource will therefore need to be a key part of their conversation with schools. This is a significant shift in the role of the SIP, and requires a cadre of SIPs with a wide range of skills and the ability both to analyse a school’s performance in a practical way and to coach the head and senior team in new ways of working.
Role of the local authority
The role of local authorities as commissioners of children’s services is set out in the White Paper. A parallel issue is how much they should be involved in helping schools to make better use of their resources. Local authorities can support schools in a variety of ways: they have always been involved in supporting procurement and many are now engaged in the introduction of OPEN. They have a role in supporting the Schools Forum which can include the examination of efficiencies, and many have been actively engaged in fostering collaboration. The funding framework set by the local formula has a strong influence on schools expenditure, and can provide incentives and disincentives to more efficient resource use.
The role of DCSF
The White Paper describes a more devolved system with less being run from the centre. But DCSF still has an important role in supporting the system. The DCSF already promotes better resource use by schools through a number of its programmes. The DCSF benchmarking website is widely used by schools to check their expenditure pattern against their peers’. The current consultancy offer allows schools access to free consultancy on delivering better value for money.
That’s the statement. We’ll be decoding it more deeply in the next few days
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