Mr Gove and the Triple A rating

Mr Gove and the Triple A rating

Accident or design? That’s the question the Chancellor of the Exchequer should be asking the Secretary of State for Education about the £3 billion or so currently sitting in school’s bank accounts. A figure that has been steadily rising since the coalition came to power in 2010 with the promise that schools would largely protected from the current round of economic hardship facing the rest of the public sector.

Data published by the DfE earlier this year showed that by the end of the last financial year schools had reserves in excess of seven per cent of their annual revenue incomes. With a government fighting recession, and keen to find ways of spending more without raising taxes, urging schools to spend some the taxpayers cash held in their accounts might help unlock some local economic paralysis if the cash went to local projects employing local workers.

Not only might the effect of schools spending £500 million a year on job creation schemes across the country, targeted at the either the low paid and long-term unemployed or alternatively new graduates yet to find a job make good political sense, but it might also actually help the economy. However, Mr Gove has been strangely silent on this key issue of the moment, preferring to fiddle around with school structures and the curriculum which, whatever their value, are longer-term issues in the current economic crisis.

Ministers who are apparently not alert to the bigger picture in cabinet, and the contributions their department can make to solve it, either aren’t up to the job or want a quiet life. There is a third alternative; they recognise that economic failure might help their own career prospects. Now nobody would accuse Mr Gove of such a cynical approach to politics and he can claim to have limited authority over the primary sector, although with some many secondary schools now academies he has much more room for intervention with that group of schools.

Before the Labour Party starts calling for Mr Gove’s head over this issue, they will need to see what steps the local authorities controlled by them, and the many Labour Party members serving as school governors, have taken to challenge the strategy of local schools building up reserves for a rainy day. The recent Ofsted report on the pupil premium, and their earlier interim findings, should have alerted the DfE to this issue even if Mr Gove ignored the Statistical Bulletin when it appeared in his ministerial box.

Perhaps it is time for that the guardian of public expenditure, the Public Accounts Committee, to intervene. After all, its chairman isn’t exactly unfamiliar with education. It may also be time for David Laws to stamp his foot about school spending. After all, it won’t help the Lib Dems if all that pupil premium and catch-up cash they have secured for schools has just made its way straight into the school’s saving account. As a former Chief Secretary to the Treasury, albeit briefly, he cannot be blind to the financial figures that cross his desk and that of his even more economically literate adviser.

The inclination by schools to save is laudable, but surely if there was ever a time to for schools to spend, it is now.

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