Nine out of 10 schools will run out of money by the next school year, as the massive burden of increasing energy bills and salaries takes their toll, observer can reveal.
Early data from the National Association of School Principals — results of a survey of its members later this month — shows that 50% of presidents say their school will be in deficit this year, and nearly all expect it to be in the red by next year. September, when their reserves ran out. This comes in the form of Jeremy Hunt He explained that all departments, including education, are expected to make cuts as part of the government’s debt reduction plan, which will be announced on October 31.
School administrators and academic leaders warn that further spending cuts will push many schools and academic confidence into a cliff, and will result in most schools losing essential faculty and support. “There are no easy solutions left,” said Paul Whiteman, NAHT general secretary. “Schools are cut to the bone. That means hours of teaching, teaching assistants and teachers are cut off.”
Reverend Steve Chalke, whose foundation Oasis operates 52 academies in England, said: “At this burn rate, in less than three years we will be bankrupt. Nobody is in a position to continue eating their reserves for long.” Chalk said electricity and gas costs for schools in his chain have skyrocketed from £26,000 a year to £89,000, even with a six-month energy price cap.
The foundation also has to find an additional £4.5m to increase teachers’ salaries, which was announced this summer after school budgets were set. The increase – which stood at 5% for most teachers and remains well below inflation – is seen as crucial but has left schools faltering because it came without new funding.
Chalk said he is “totally disappointed” that the government is planning further cuts. He added that “any government that neglects the welfare and education of its children would have done better to save for future mental health bills and benefits, and to invest in the justice system.”
A spokesperson for the Department of Education said: “We understand that schools are facing cost pressures due to the international events that have driven up energy prices.” It added that in addition to the energy relief scheme, schools would receive 53.8 billion pounds of core funding this year “including a cash increase of 4 billion pounds”.
But Johnny Otley, chief executive of the Education Alliance Academy Trust, which operates seven schools in Hull and East Yorkshire, said: “I know an executive of a large, successful trust who says that after an unfunded teacher salary increase, they won’t have a continuing concern next year unless there is Additional financing.
Otley’s trust uses reserves to manage energy, repayments and other costs, but he said, “There comes a point where the money simply runs out.” Gary Ratcliffe, chief executive of Galaxy Trust, which operates three primary schools in Dartford, Kent, said his confidence would be fine this year, but “next year will be very difficult if there are more unplanned announcements.” He warned that a “very large funding crisis” was looming.
Ratcliffe’s confidence lies in spending more on mental health support for children and employees who are in a cost-of-living crisis. The school regularly provides food for desperate families, as well as helping parents claim extra benefits or challenge rent increases.
“Families who did not need support before come to us,” he said. “There’s a lot of shame for the hourly father who can, but he still has to go to school and ask for help.”
This year has been uncertain, said Leora Crudas, chief executive of the Federation of Schools Associations, but the next was looking really difficult: “Many funds have to use some or all of their reserves. But the reserves can only be spent once. The government should step in on the Urgently. Public education must be adequately funded by the state.”
Julia Harnden, a finance specialist for the Association of School and College Leaders, said ministers must act now to avoid an impending educational disaster. “These additional costs will necessitate staff reductions, which means more classrooms, fewer curricular options, and less support for students,” she said.