School Funding 2016-17 & Forward Financial Planning Shropshire - PowerPoint PPT Presentation

School Funding 2016-17 & Forward Financial Planning Shropshire Governors/Headteachers/School Business Managers Lord Hill Hotel, Shrewsbury Wednesday 7 October 2015, 4.30pm to 6.00pm 1

• Welcome and introductions • Presentation covers 2 key areas: � School Funding 2016-17 – update on the Government’s announcement of funding for schools for next financial year � Forward Financial Planning – the Shropshire picture and the importance of forward financial planning by schools 2

School Funding 2016-17 3

School Funding 2016-17 Background • Significant reforms to the local school funding formula since 2012-13 • Local authority, through and with Shropshire Schools Forum, have managed the required formula changes • Government acknowledges current national schools funding system is unfair and out-of-date • Government’s aim is to move to a National Fair Funding Formula 4

School Funding 2016-17 Headlines • Shropshire’s Schools Block per pupil unit of funding in 2016-17 will be the same value as in 2015-16 including the additional Minimum Funding Level allocation of £10.3m • Minimum Funding Guarantee (MFG) will continue in 2016- 17 at minus 1.5% • No proposed changes to Shropshire’s local funding formula in 2016-17 • Individual school budget shares for 2016-17 will be based on October 2015 census data and published with maintained schools late January/early February 2016. Academies will receive notification from the EFA. 5

School Funding 2016-17 Allowable Formula Factors 1. Basic Entitlement (Age Weighted Pupil Unit) 8. Lump Sum 2. Deprivation 9. Split Sites 3. Prior Attainment 10. Rates 4. Looked After Children 11. Private Finance Initiatives 5. English as an Additional Language 12. London Fringe 6. Pupil Mobility 13. Post 16 7. Sparsity 14. Exceptional Premises Factors 6

Government’s Manifesto 2015 • Amount of money following a child into school will be protected • Continuation of the pupil premium, protected at current rates • Support for families by providing free meals to all infants • Make schools funding fairer 7

Forward Financial Planning 8

Understanding the Shropshire Picture Demographic Challenge • Shropshire is bucking the national trend with overall pupil numbers forecast to fall by 3.2% by 2018 (3.7% in primary and 2.6% in secondary) • Shropshire will have more unfilled places by 2018 • Housing developments are not generating material growth in pupil numbers • In the period 2004 to 2013, there were 10,795 housing completions in Shropshire while pupil numbers fell by 3,750 (9.6%) 9

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Understanding the Shropshire Picture Impact on Dedicated Schools Grant (DSG) and Individual School Budgets • Falling rolls will reduce the overall DSG received by Shropshire over the next 4 years by approximately £5m • Shropshire received £4,402 per pupil in 2015-16 • Individual schools with falling rolls will receive less funding as the majority of funding is based on pupil- led factors 11

Understanding the Shropshire Picture Projected number on roll and budget variances 2016-17 to 2019-20 2016-17 2017-18 2018-19 2019-20 Var from 2015-16 Var from 2016-17 Var from 2017-18 Var from 2018-19 Total variations NOR £ NOR £ NOR £ NOR £ NOR £ Small Primary (50 on roll) 0 361 -4 -12,499 -8 -25,438 -7 -22,466 -19 -60,042 Medium Primary (180 on roll) -12 -39,849 -3 -9,628 -13 -45,025 -8 -28,986 -36 -123,488 Large Primary (420 on roll) -17 -56,741 -14 -47,834 -2 -7,737 -17 -63,824 -50 -176,136 Secondary (700 on roll) -53 -265,521 -23 -105,663 -5 -24,204 6 21,770 -75 -373,618 12

Understanding the Shropshire Picture Pupil Place Planning • Fall in pupil numbers not evenly spread across the county – some areas will see modest growth in pupil numbers • In next 4 academic years, through to 2019/20, an additional 8 classrooms will be required for this growth • Five planning areas are affected: Market Drayton, Oswestry, Shifnal, Shrewsbury and Whitchurch • A consultation on a School Place Planning paper will get underway later this term • Meetings will take place in each of the five planning areas to consider the options 13

Understanding your Budget What income streams do schools have? � Budget Share � Pupil Premium � High Needs Top-Up Funding � Other Specific Grants � Donations/Lettings � Other 14

Understanding your Budget 15

Understanding your Budget Impact on income from: � Demography � Number of free school meal (FSM) pupils � High Needs pupils � Sparsity � Minimum Funding Guarantee (MFG) – does not protect against a falling roll 16

Understanding your Budget What expenditure commitments do schools have? � Staffing accounts for over 75% of school revenue expenditure � Cost pressures – pay awards, incremental progression, increasing employers pension contributions, non-pay inflation costs � Timescales for making reductions – take early action � Priorities in line with School Development Plan 17

Understanding your Budget School Deficit Budget Protocol for Maintained Schools • Schools planning a deficit budget must first get approval from the local authority • Schools must follow the Protocol for Schools Planning and Managing a Deficit Budget, available on the Shropshire Learning Gateway • Schools will only be allowed a deficit budget in exceptional circumstances • Schools placed in Special Measures will not be allowed a deficit budget 18

Understanding your Budget Schools Financial Value Standard (SFVS) • The SFVS is a mandatory requirement for all local authority maintained schools • Designed to help schools manage their finances and give assurance that they have secure financial management in place • It is primarily aimed at governors • Schools must complete the SFVS assessment form on an annual basis and return a copy, signed by the Chair of Governors, to the local authority by 31 March each year 19

Financial Planning Tools q Modelling Tool q Benchmarking Tool 20

Modelling Tool • Allows schools and governing bodies to analyse and model future year budget shares based on projected numbers • Provides headteachers and governing bodies with a method of appraising and managing future year budgets, in particular where these budgets are likely to reduce • Uses latest 2015-16 funding values to estimate future year budget shares • Shows the local authority’s forecast aggregate number on roll through to 2019-20 for the linked secondary school • Federation/collaboration modelling tool is available 21

Shropshire Council - School Funding Modelling Tool 32360 An Example School Pupil Forecast 2016-17 to 2019-20 131 140 2015-16 2016-17 2017-18 2018-19 2019-20 120 Oct 14 Census Oct 15 Census Oct 16 Census Oct 17 Census Oct 18 Census 109 120 Nor Nor Nor Nor Nor 131 94 Reception Uplift 0 0 0 0 0 88 100 4+ 13 10 11 6 6 105 5+ 20 14 10 11 6 98 80 6+ 17 19 13 9 11 84 77 7+ 17 17 19 13 9 60 A 8+ 22 15 15 15 15 40 9+ 23 15 15 15 15 C 10+ 19 15 15 15 15 20 11+ 0 0 0 0 0 Total 131 105 98 84 77 0 Oct 14 Census Oct 15 Census Oct 16 Census Oct 17 Census Oct 18 Census Local Authority NOR Forecast School Modified Forecast LA Forecast (without housing) (without housing) 131 120 109 94 88 Estimated Future Years Budget Shares 32360 An Example School Budget Share Forecast 2016-17 to 2019-20 2015-16 2016-17 2017-18 2018-19 2019-20 £600,000 Act Est Est Est Est £518,481 Nor 131 105 98 84 77 £482,115 £500,000 £445,173 £518,481 FSM % 6.11% 6.11% 6.11% 6.11% 6.11% £393,957 LPA % 4.69% 4.69% 4.69% 4.69% 4.69% £372,663 £400,000 £431,122 £407,732 £ £ £ £ £ B £359,937 Pupil Led 421,769 338,884 316,699 271,313 247,932 £300,000 £335,352 Fixed 74,170 74,170 74,170 74,170 74,170 AEN/SEN 22,542 18,068 16,863 14,454 13,250 £200,000 MFG 0 0 0 0 0 Total Estimated Budget Share £ 518,481 431,122 407,732 359,937 335,352 £100,000 Budget share variation £ to prev -21,276 -87,359 -23,390 -47,795 -24,585 £- % variation to prev yr -3.94 -16.85 -5.43 -11.72 -6.83 2015-16 2016-17 2017-18 2018-19 2019-20 School Modified Budget £ LA Estimated Budget £ LA Budget Share Forecast £ 518,481 482,115 445,173 393,957 372,663 De-delegation Linked Secondary School Area Data -125 2015-16 2016-17 2017-18 2018-19 2019-20 Cumulative primary NOR change for linked secondary school Act Est Est Est Est area. £ £ £ £ £ Estimated De-delegation 3,228 2,587 2,415 2,070 1,897 Funding Per Pupil D £ £ £ £ £ Forecast Funding 3,958 4,106 4,161 4,285 4,355 Support with the use of this tool can be provided Shropshire Average Funding 4,109 4,118 4,124 4,127 4,130 by the traded Schools Finance Support Service. Historic Closing Revenue Balances (Included at gold level) Year Ending March 2010 March 2011 March 2012 March 2013 March 2014 £ £ £ £ £ Final Closing Revenue Balance 48,658 19,601 26,510 25,078 42,535 22