Are academies hoarding their cash?

What’s the use of giving schools money they don’t spend? This has been a theme running through this blog ever since the first entry way back in January. The latest figures for academies and the other esoteric school types funded from Westminster shows that these schools were in some cases no better than their maintained counterparts in using revenue cash to support the learning of their pupils. https://www.gov.uk/government/publications/income-and-expenditure-in-academies-in-england-academic-year-2011-to-2012

No doubt the Treasury will eventually ask why school budgets should be protected if the cash handed to them is promptly put in the bank. Mr Clegg might also ask whether schools are really helping in his drive for a million new jobs by sitting on plies of cash.

Anyway a few numbers:

For 2011/12, the median total income (£ Per Pupil) for secondary academies with Key Stage 4 was £6,333, compared with £7,880 in 2010/11. The decline between the two years may indicate exactly how much initial converter academies were funded in excess of what they had previously received as maintained schools.

According to the DfE, the changing composition of secondary academies, with increasing numbers of converters, has narrowed the difference in total income (£ Per Pupil) between academies and maintained schools (secondary with KS4). For 2011/12 the median total income (£ Per Pupil) for academies (secondary with KS4) was £713 higher than maintained schools (secondary with KS4), compared with £2,469 in 2010/11. Many might ask why median total income per pupil in academies is still more than £700 higher than median per pupil income in maintained schools.

For 2011/12, the median total expenditure (£ Per Pupil) for secondary academies with Key Stage 4 was £6,058, compared with £7,405 in 2010/11. For 2011/12 the median total expenditure (£ Per Pupil) for academies (secondary with KS4) was £556 higher than maintained schools (secondary with KS4), compared with £2,052 in 2010/11. Nevertheless, an academy with median income and expenditure per pupil still banked £275 per pupil. For a school of 1,000 pupils that’s £275,000 just over 4% compared with 6% in the previous year. However, as this is the median figure it may not be as helpful as either the mean or modal class would be.

The trends are similar for secondary schools without Key Stage 4 and for primary and special school academies, although the small numbers make comparisons not really sensible.

A quick bit of arithmetic with the raw data suggests that the overall balance in academy bank accounts might be in the order of £175 million including muli-academy trusts where data is available. Around 100 academies may be sitting on cash pies in excess of £1 million each, and this figure is supposed to exclude any reserves held by the schools before they became an academy. However, there are also a large number of academies that appear to have spent more than their incomes.

We will need to see a few more years of data in order to discover whether these initial figures represent a trend. However, we won’t need to wait to discover whether the portion of grant income spend on teaching costs is similar to that in maintained schools. After all, one of the reasons for providing academies with their freedom was to allow them to spend their funding as they see fit to improve the standard of education of their pupils.

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