School Forum

14 December 2010

Budget 2011/12

• Schools Funding announcement• Schools budget 2010/11• Budget issues

– Mainstreaming grants– Equal pay– Redundancy and retirement costs

• Business for January Forum

School Funding announcement• Headlines from last night’s settlement –

posted at 6pm!• Hampshire DSG settlement• One year • Mainstreaming• MFG • Pupil premium• Academy funding and LACSEG recoupment• Early years

School funding announcement• One year settlement for 2011/12 only• Mainstreaming grants including diploma

formula grant (not previously highlighted as in base line)

• Flat cash settlement …. – For all authorities– Hampshire

• 2010/11 Grants per pupil £515.74• 2010/11 DSG per pupil £4,131.89• 2011/12 GUF per pupil £4,647.63

– With cash floor to protect those with fast falling pupil numbers

School Funding announcement• Minimum Funding Guarantee

– No school with budget cut of more than 1.5% per pupil

– In most areas LAs should be able to offer greater protection and in consultation with Schools Forums set a higher guarantee

– Pupil premium not included in calculation of guarantee and must be added after guarantee applied

Pupil premium• April 2011 introduction• Grant based on Jan 2011 census, children

eligible for FSM years R to 11– “Ever free school meals” aimed for 2012/13

• £430 per deprived child flat rate nationally for 2011/12

• Deprived pupils in– Maintained schools and academies, non maintained

settings publically funded– Special schools, independent schools, PRUs– Children looked after for more than six months– Premium for service children of £200

Pupil premium• Hold schools accountable for how they

use premium– New measures in performance tables that

capture achievement if pupils covered by premium

– Require schools to publish on line how they have used the premium

• Ensure parents and others aware of progress and attainment and concentrate schools’ minds on using it appropriately

Pupil premiumestimate from 2010/11data

FSM Data Pupil Premium£

Primary 9,700 4,171,000

Secondary 5,300 2,279,000

Special 546 234,780

Service children 5,166 1,033,200

Children Looked After

665 285,950

Total 21,377 8,003,930

Academy funding 2011/12

• Budget lines calculated net of income not gross• LA budgets reduce this year, LACSEG will

reduce accordingly• Central school improvement grants end so

excluded from calculations for this year– Removes current LACSEG of £312 per pupil

• CLG topslice from LAs will start for 2011/12, and will not be targeted at individual LAs but top sliced nationally– Less turbulence, but could be disproportionate impact

• Updated ready reckoner promised imminently

Early Years settlement

• No pupil premium• Standards Funds for EFE £7.752m in

2010/11 included in cash baseline– Assume therefore it is mainstreamed, but

through different approach to schools grants• More work required• Will continue with arrangement where

LAs with less than 90% of 3yo pop’n take up free entitlement funded as though they did– No longer a benefit for us

To do …

• Much work to do to fully unpack settlement

• Track through mainstreamed grants• LACSEG reductions to LA grant• Removal of Dual registration for

excluded pupils• Standards fund for EFE transfer

Schools Budget 2010/11

Cash Limit £000

Period 7

Variance

£000

%

LMS Contingency 9,817 -1,693 -17.2

Payments for 3 and 4 year olds 39,566 +651 +1.6

Statemented Pupils 10,087 -945 -9.4

Inter Authority Recoupment 630 +212 +33.7

Out of County Special Schools 9,534 -349 -3.7

Other (primarily directly allocated to Schools)

769,598 -509 -0.1

Total 839,232

-2,633 -0.3

Schools Budget 2011/12

• Base budget– Pupil numbers– Cash settlement – no inflation

• Headroom from 2010/11 position– Risk appetite on current underspends

given one off headroom

• Current pressures

Pupil numbers

2010/11

DSGpositio

n

Change to

2011/12

Change 11/12

to 12/1

3

Change

12/13 to 13/14

Early Years (FTE) 8,780 0 132 134

Reception 13,890 47 -254 209

Primary schools years 1 to 6

80,002 -76 793 653

Secondary to year 11 68,365 - 223 - 987 -1,031

Special schools and other aspects

3,372 0 0 0

Totals 174,409 -252 -316 -35

Pupil numbers – net cost pressure

2011/12£m

2012/13£m

2013/14£m

DSG forecast reduction 1.041 1.306 0.145

Changes to ISB and base budget

0.617 1.061 0.386

Net pressure/ (headroom)

0.424 0.245 (0.241)

Current 2011/12 headroom Change

To 2011/

12

2011/12 to 2012/13

Para £000 £000

Carry forward already agreed (one-off)

3.3 4,660 -4,660

Additional 2010/11 underspend 2.1 2,600 -2,600

Statemented Pupils 3.30 100 0

Business Rates 3.30 443 0

FMSiS 3.31 50 0

Total 7,853 -7,260

£7.853m in 2011/12 and an ongoing £597,000

in 2012/13

Current 2011/12 pressuresChange

To 2011/1

2

2011/12

to 2012/1

3

Para £000 £000

DSG – Pupil numbers 3.20 424 245

Equal Pay 3.35 3,100 1,900

Carbon Tax 3.37 1,000 -1,000

Schools-related premature retirement costs etc

3.9 400

Admissions, employer’s obligations and insurance

3.40 443

Independent Investigations 3.45 10

Total 5,377 1,145

Current 2011/12 headroom• Significant one off funding

– Consider risk appetite for budget assumptions around on going underspends • Eg:- SEN statementing and out county

placements

– Consider one off funding for costs of restructuring and redundancy in schools• Potential MFG issues

Budget issues – mainstreaming grants• flat cash settlement for the new schools budget • grants are not currently expected to be materially

reduced/topsliced before being added into the Dedicated Schools Grant.

• receive the total value of 2010/11 allocations, adjusted for : – changes in overall pupil numbers

» the removal of funds allocated on the basis of sixth form pupil numbers

– the exclusion of funds relating to known Academies– any clearly identified one off items.

• Settlement added diploma grant funding £811,000 not previously referenced

Budget issues – mainstreaming grants2010/11 Grants £'000

School Development Grant (SDG)

21,697

School Standards Grant (SSG)

28,004

Schools Standard Grant Personalisation (SSG-P) 6,482

Specialist School Status 9,828

School Lunch Grant 1,692

Ethnic Minority Achievement Grant (EMAG)

494

One to One Tuition 5,614

Extended Schools 6,874

National Strategies 7,152

Total

87,837

Budget issues – mainstreaming grants• Schools Development Grant• combination of per pupil and flat rate

produces a reasonable fit, to Support Staff element– Advanced Skills Teachers – retain current

approach– Excellence in Cities grant - £1.41m over 16

schools (1 special, 2 secondary and 13 primary)– Leadership Incentive Grant (LIG) - £611,000 at

5 secondary schools – Model long term approach using some existing

low attainment and deprivation factors and balance with pupil premium

Budget issues – mainstreaming grants• School Standards Grant (SSG

and SSG-P) – combination of flat rate and per pupil

will broadly fit– SSG-P uses frozen data from 2006– bring more detail to the January

meeting.

Budget issues – mainstreaming grants• Specialist School Funding

– Four schools get part year funding in 2010/11, propose finding £116,000 in 2011/12 to give full year effect

– Two secondary schools receive no funding, some have second and third specialism. Initially propose the allocations be retained with those schools currently receiving them, seeking to move to move to standard formula over three year period

– Quirk with 1,001st to the 1,200th pupil not recognised for funding purposes. Cost of a simplification so all pupils above the 1,000th were recognised would be £0.784m

Budget issues – mainstreaming grants• School lunch grant

– retain current formula and include it as part of the school meals management partnership line

• Ethnic Minority Achievement Grant – Schools Forum previously agreed to hold

centrally as “needs are real, dispersed and variable so schools are unable to build individual school capacity to meet the needs”

– Propose to continue

Budget issues – mainstreaming grants• Potential headroom and flexibility £19.64m

– Extended schools funding– National Strategies – One to one tuition

• None are currently delegated to individual schools

• All previously expected to cease• Consider first for any Schools Budget

flexibility and to offset any top slicing before the grants are added into DSG

Budget issues – Equal Pay

• Budget strategy for funding Option B– Seek borrowing of £80m, revenue funding

for costs of borrowing £5.5m pa– 2011/12 funds set aside £2.4m – £5.5 m revenue cost of borrowing in

2011/12 requires further £3.1m (ongoing provision)

– 2012/13 further £1.9m ongoing provision

Budget issues – Equal Pay

• Effect top slice equally or differentiate?– By school type – aided and foundation– By school phase

• Aided schools – currently only one claim, but more could be generated if

it is successful – Potential insurance cover for aided schools– Aided schools borrowing from school balances loan

scheme• Schools Forum 2008 decision set aside £0.5 m

per annum was collective with all schools impacted

• Provision in budget shares for the costs of Pay and Benefits was shared between all schools

Budget issues – Equal Pay

All schools All schools except

Aided

All schools except

Aided and schools Foundation

in 2001

Average % smoothed over all

0.91% 0.98% 1.08%

By phasePrimary 1.14% Secondary 0.58% Special 1.54%.

Budget issues - Redundancy and retirement

• Net cost met by the local authority budget in 2009/10 was £2.810m – Continuing payments from previous years met

centrally £2.455m– New cases – Share charged to individual schools

£0.280m– New cases – Share met centrally

£0.355m• Propose moving solely the budget provision for

new commitments of £0.4m to the Schools Budget and then meeting all the resulting future costs that are funded centrally from that budget

• Pressure of £0.4 m a year for Schools Budget budget proposals for 2011/12

HCC position

• Current budget guidelines are for 8% cash limit reductions for services for 2011/12 and 2012/13 with activity pressures to be absorbed

• Settlement headlines looking consistent with that planning scenario given front loading of cuts over 4 years

January Forum business

• School group pressures and issues– Presentations

• Full analysis of Hampshire school funding settlement

• Modelling of – Absorbed inflation impacts?– mainstreaming grant proposals– Teachers pay reform grant – SEN formula changes

• Formal consideration of Equal Pay funding strategy

• Consideration of MFG/ transitional protection• March Forum for central expenditure limit and

January 2011pupil number changes