Schools and financial efficency

September 29, 2009 12:28 PM

Few things are as complex as the organisational structure of the Ministry of Defence. A true organogram of the department would probably need to use a fourth dimension. But a close rival in complexitiy must be the mechanisms for funding the state schools system. 

The Department for Children, Schools and Families sits on the top of the pile, jealously guarding access to the credit card. Over 150 spatially significant local authorities are then squashed beneath that department, responsible for distributing central funds to the schools in their areas, but entirely neutered in terms of meaningful decision making. Buzzing about this heap are the various 'semi-autonomous' bodies, responsible for everything from rebuilding classrooms and updating ICT, to curriculum content, teaching standards and pay.

Amidst it all schools struggle away with a bizarre mix of spending autonomy and centralised direction. Head teachers are informed that money is available to rebuild the French block, but to access it the school must work as the junior partner in a public-private partnership, dominated by a giant quango, the local authority and a contractor. The inner city school desperate to retain its struggling staff is promised help, but when that comes it's not in terms of extra funding or head-teacher empowerment, but a new (centrally drafted) golden handcuffs contract for new teachers.

It should be of no surprise then that few schools have particular financial expertise. Why should they? Most spending important spending decisions are made elsewhere.

This lack of financial nous was certainly the conclusion of Richard Handover's report for DCSF. Leaked to the BBC, the report concludes in no uncertain terms that civil servants and head teachers have no idea what value for money means: "Financial efficiency... is not seen as a core responsibility of management at any level."

Away from the headline grabbing examples ("£50,000 spent installing three toilets in a primary school" and "£35,000 on a £1,000 photocopier") the thrust of the inquiry was that the department - and schools themselves - are just bad at spending money. Many millions are lost because civil servants and school administrators rarely have to think about the actual cost implications; even if the new French block ends up costing £12 million when it was only supposed to cost £1 million, teachers will still get paid exactly the same, the food served in the canteen will not change and kids will still not have access to sports everyday.

Ed Balls is a very clever man, which made his wilful refusal to accept the need for spending cuts all the more distasteful. Now that he has relented, and begun to talk seriously about what needs to be done, a proper debate can start about how education is funded in this country. Savings will have to be made in the short term; Richard Handover recommends cutting the number of teaching assistants, a growth industry that appears to have had no beneficial impact for children (and even in some cases has been harmful - see here). Ed Balls has suggested cutting back bureaucrats and senior school staff. People are rightly cautious at the notion of reducing the number of school leaders, but Balls has had some considerable success with the 'Federation' programme he initiated - where one 'super-head' is properly empowered to meaningfully manage a number of struggling schools - so it may be a sensible move. Such measures though, while important, are just the first step in what must be much more wholesale reform, which would return power (in this case financial responsibility) back to schools themselves. Financial nous would follow; parents, teachers and children would start to make decisions themselves about their school. 

Few things are as complex as the organisational structure of the Ministry of Defence. A true organogram of the department would probably need to use a fourth dimension. But a close rival in complexitiy must be the mechanisms for funding the state schools system. 

The Department for Children, Schools and Families sits on the top of the pile, jealously guarding access to the credit card. Over 150 spatially significant local authorities are then squashed beneath that department, responsible for distributing central funds to the schools in their areas, but entirely neutered in terms of meaningful decision making. Buzzing about this heap are the various 'semi-autonomous' bodies, responsible for everything from rebuilding classrooms and updating ICT, to curriculum content, teaching standards and pay.

Amidst it all schools struggle away with a bizarre mix of spending autonomy and centralised direction. Head teachers are informed that money is available to rebuild the French block, but to access it the school must work as the junior partner in a public-private partnership, dominated by a giant quango, the local authority and a contractor. The inner city school desperate to retain its struggling staff is promised help, but when that comes it's not in terms of extra funding or head-teacher empowerment, but a new (centrally drafted) golden handcuffs contract for new teachers.

It should be of no surprise then that few schools have particular financial expertise. Why should they? Most spending important spending decisions are made elsewhere.

This lack of financial nous was certainly the conclusion of Richard Handover's report for DCSF. Leaked to the BBC, the report concludes in no uncertain terms that civil servants and head teachers have no idea what value for money means: "Financial efficiency... is not seen as a core responsibility of management at any level."

Away from the headline grabbing examples ("£50,000 spent installing three toilets in a primary school" and "£35,000 on a £1,000 photocopier") the thrust of the inquiry was that the department - and schools themselves - are just bad at spending money. Many millions are lost because civil servants and school administrators rarely have to think about the actual cost implications; even if the new French block ends up costing £12 million when it was only supposed to cost £1 million, teachers will still get paid exactly the same, the food served in the canteen will not change and kids will still not have access to sports everyday.

Ed Balls is a very clever man, which made his wilful refusal to accept the need for spending cuts all the more distasteful. Now that he has relented, and begun to talk seriously about what needs to be done, a proper debate can start about how education is funded in this country. Savings will have to be made in the short term; Richard Handover recommends cutting the number of teaching assistants, a growth industry that appears to have had no beneficial impact for children (and even in some cases has been harmful - see here). Ed Balls has suggested cutting back bureaucrats and senior school staff. People are rightly cautious at the notion of reducing the number of school leaders, but Balls has had some considerable success with the 'Federation' programme he initiated - where one 'super-head' is properly empowered to meaningfully manage a number of struggling schools - so it may be a sensible move. Such measures though, while important, are just the first step in what must be much more wholesale reform, which would return power (in this case financial responsibility) back to schools themselves. Financial nous would follow; parents, teachers and children would start to make decisions themselves about their school. 

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