Schools may have to make redundancies to avoid plummeting into financial black hole

Council report warns number of schools in deficit budget could increase after funding allocation confirmed

SEVERAL West Berkshire schools could have to make redundancies to avoid plummeting into a financial black hole, a new council report has warned.

The report revealed that the funding allocation for schools will not be enough to cover an increase in costs for many.

It states: “Real term reductions in funding allocations will inevitably lead to staffing restructures and possible redundancies in schools.

“For many schools their funding allocation will not increase by anywhere near the amount required to cover current increases in costs; the number of schools at risk of deficit will increase, and the non-viability of small schools may become a reality.

“It is imperative that the work which commenced in 2017/18 on supporting schools in financial difficulty continues.

“The gains for most schools are not significant and many will still have difficulty in balancing their individual budgets moving forward, particularly the 20 schools where pupil numbers have decreased and funding has gone down.”

West Berkshire Council opposition leader Lee Dillon (Lib Dem, Thatcham North) described the situation as “a mess”.

He added: “It is clear that the financial settlement for schools is not enough.

“School staff and governors are being asked to take tough decisions through no fault of their own.

“With staff not being replaced, nursery provisions being examined and other staff being asked to step up and cover posts, this does not bode well for our children's education.

“It is time the Government gave our schools the funding they need to give our children the education they deserve without the fear of schools having to close.

“The council are meeting with schools to give budget support, but if there isn’t enough cash no spreadsheet in the world will sort out the mess we are seeing.”

However, the council’s portfolio holder for education, Lynne Doherty (Con, Northcroft) said that with careful financial planning, no school should be going into a deficit budget.

She added that there was a process that West Berkshire Council has put in place for those schools that are in the difficult position.

The increase in approximately £1.3m in overall funding on a like-for-like basis for West Berkshire schools represents a significant improvement from the original proposal, which would have seen around half of the district’s schools funding reduced.

But the report warns: “Although all schools will see an increase to their pupil-led funding, for many the increase is minimal and nowhere near the level of inflation, and these schools will continue to struggle to set a balanced budget.

“Small schools in particular will see an impact and the future viability of many is questionable.

“It is likely that the number of schools in deficit will increase, where they do not act fast enough to make the necessary structural changes.

The NWN previously reported how 15 schools were in deficit in the 2016/17 financial year.

For schools that gain funding under the new formula, additional funding is capped at three per cent per pupil (as per the National Funding Formula).

For schools that lose funding under the new formula, a minimum funding guarantee of an additional 0.1 per cent per pupil increase is applied (this is the maximum affordable).

The council admits the cost of unmanageable school deficits or closing schools may fall on the council.