Budget Outturn and School Balances 2018/19
To receive the above report.
James Norris, Head of Finance (AfC), introduced the report to the Forum and explained the purpose of the report was to provide a summary of the final outturn position of the Schools Budget 2018/19, the funding held in the DSG reserves and also, the level of maintained school balances held at 31 March 2019. James Norris asked Members of the Forum to note the contents of the report and to approve the carry forward of the deficit balance on the DSG reserve. He explained table one of the report summarised the financial position and showed the full outturn had favourable movements but the high needs block was still seeing budget pressures.
With regards to the high needs block, significant reduction in costs reflected a number of cost saving strategies including 0% inflation increases on providers, successful negotiation rates for new high cost placements, developing a more robust tribunal process and the continuous implementation of a more collaborative and inclusive approach within schools to retain pupils with special educational needs rather than seeking high cost alternative provision. The savings led to cost avoidance of (£327,000); clarity from ESFA of changes in funding arrangements for Further Education and colleges which had previously been in dispute resulting in the release of provision (£102,000); reduction in Alternative Provision Outreach costs following implementation of new contract (£76,000); with others at (£9,000). All of the money had been released into the forecast.
James Norris stated in the last quarter, the overspend had reduced as reported to Cabinet and Council. The overall position was that the net in-year underspend was a favourable movement on the dedicated schools grant reserve deficit which as at 31 March 2018, was a deficit of £1,212,000; the revised deficit as at 31 March 2019 had been reduced to £917,000 gross of earmarked balances.
The Director of Children’s Services stated the Borough would be one of the few local authorities to not have to report to the DfE as the Council had a deficit of less than 1%. He went on to say the SEN tribunal process was fair and robust, giving an example of a recent tribunal decision where they agreed with the Local Authority that for one particular child there was suitable educational provision in a maintained school resulting in cost avoidance exceeding £192,000 per annum. If the Borough had been unsuccessful at the Tribunal, it would have meant sending three children to a special placement. Hugh Boulter asked if the Borough and schools had identified all areas where savings could be made. James Norris confirmed work was still ongoing to identify other saving opportunities. The Director of Children’s Services state the Council had also held prices of placements down and had appointed an officer to look to try and hold prices down for all placements. The Borough had also received £368,000 extra from central government which had helped.
The Director of Children’s Services directed Members to table three of the report which showed the general reserve but there was an earmarked reserve of £134,000 so the official reported position sat at £783,000 in deficit and with effect from 2018/19 the ESFA introduced a new requirement on local authorities that have a cumulative deficit exceeding 1% of their budget allocations.
The Maintained School Balances had gone from £1.9m to £1.4m so there had been a significant year on year impact. There were 30 schools with surplus balances and eight schools with a deficit. Appendix A of the report set out the school by school balances. Members needed to be aware that some schools included their breakfast club budgets into their school budgets so not all schools were compared like for like. Tracey Anne Nevitt, AfC Finance, confirmed all breakfast club funds should be included in school budgets as per government guidelines; if the schools were audited, they would be advised to move breakfast club funds from private funds into school budgets.
RESOLVED UNANIMOUSLY: That the Schools Forum noted contents of the report and approved the carry forward of the deficit balance on the DSG reserve.