Local authorities are starting to warn schools that they must spend the money in this year’s generous financial settlement, or else the government will remove it. The fear is that the state will not only remove the unspent money, but also will reduce the school’s budget for the following year on the grounds that if the money was not needed this year, it won’t be needed next year.
Some schools clearly believe that the softer approach of the Labour government in the past will continue, in which schools were often wrapped on the knuckles, but didn’t always have the money removed. Where it was removed from the school it was generally handed back to the LA with the instruction that it should be redistributed among other schools.
To believe that the Coalition government will act in the same way seems the height of folly, and that is causing local authorities to warn schools that they will have absolutely no compassion from the authority if they do choose to try and keep money in a bank account for some ill-defined and un-priced future project – especially if that project was the same one used as an excuse last year.
National figures released by the Labour Government earlier this year showed schools across the country were sitting on more than £1.7 billion, with 33 per cent of schools having bank balances which were officially declared “excessive”.
In Northamptonshire, a new county council report has shown at the end of the last financial year the figure had risen to £49.7 million, prompting councillors at a cabinet meeting on 8 June to call for schools to make use of the money or potentially face the Government taking some of it back.
County council leader, Cllr Jim Harker said: “Nearly £50 million is a massive sum and I can’t see how it can be justified.
“We’re told it’s earmarked for projects but during recent years the money hasn’t gone down, it’s gone up. Every year it’s not being spent.”
Cllr Harker was backed by the council’s cabinet member for finance Bill Parker, who said the new Government could decide to take the money off the schools.
He said: “It’s a frustrating report and I’m sure the new Government has got its eyes, not just on the schools balances situation in Northamptonshire, but nationally too, so we may see these figures move. This money should be spent on the pupils it was allocated for.
“The schools have managed to justify some of the money and the schools forum has agreed it will work to reduce this over the next 12 months.”
The report showed about £2.7 million is being held by nurseries, nearly £30 million is in primary school balances, just over £13 million belongs to secondary and middle schools and nearly £4 million is held by special schools.
Schools have told the council about £12 million of the money has been earmarked for building projects and the rest is to pay for ongoing running costs.
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