To receive the above report.

James Norris introduced the report to Members, which provided the outturn position of the Schools Budget 2019-20 and the position finalised for the last financial year. The report covered the level of Dedicated Schools Grant (DSG) deficit held at the end of the financial year and the level of school balances for maintained schools.

The schools budget had £64,000,000 allocated, £34,000,000 of which was allocated directly to schools and the remaining £29,000,000 was managed by the local authority. Of the £29,000,000, there was a net overspend of £242,000 for 2019/2020. With the net overspend combined with £917,000 deficit position brought forward, there was a net in-year overspend of £1,159,000. With the combined DSG earmarked reserves of £134,000 from 2019/20, the overall net deficit was £1,025,000.

There was a requirement of the School Forum to approve the deficit carried forward to 2021/22.

The net deficit was a cumulative deficit of 0.83% of the overall school budget allocation, and it was previously a target to remain under the 1% threshold to avoid submitting a Deficit Recovery Plan. However, the government guidelines had changed, therefore all authority’s in a deficit position at the end of the financial year had to submit a Deficit Recovery Plan.

The template of the Deficit Recovery Plan was still being created by the Department of Education (DfE) and Achieving for Children (AfC) had some input in the template. The template was unlikely to be released until a number of weeks and the submission was likely to be in Autumn 2020.

There was a net surplus of £1,552,000 in the maintained school balance, which was a net favourable movement of £132,000 compared to the previous year.

The Royal Borough of Windsor and Maidenhead (RBWM) did not have the control mechanism to recover excessive balances that schools held, but it was now considering this due to the financial position the authority was in. The reclaim excess balance had been estimated to be approximately £1,400,000.

The Chairman said reclaiming excessive surplus, which was done by accruing for a project or a rainy-day fund, may prove unpopular with schools, especially when doing a three-year budget with increasing costs. He understood why the local authority would reclaim excess balance, but this was something to be managed carefully, as schools may have saved that money for a future budget.

James Norris said the excessive balance in total at the end of the financial year was £950,000, and schools identified in their annual return that they had commitments of approximately £700,000. Therefore, the authority would not look at the committed element, but rather the £250,000 of further funds that was not currently shown as committed. The Chairman said the remaining uncommitted amount could quickly become committed. The Members were informed that this was just a consideration and the funds would be redistributed to the schools.

The Chairman asked for the year on year comparison of deficit and the Members were informed that there was an increase of £242,000 from last year’s position and an increase of £180,000 from the year prior. There was a steady increase in the year on year comparison in the wrong direction.

Hugh Boulter, Representative for Furze Platt Senior School, asked if the Deficit Recovery Plan was like an action plan on how to use the deficit, and therefore was there a target to meet in a years’ time. The Members were informed that the template was not yet released, and it was anticipated that the recovery plan was likely to be for the next three to five years.

Kevin McDaniel, Director of Children Services, said this was a precursor to the introduction to the National Funding Formula. If the Formula was introduced, the Schools Forum would not have a say in the way money was devolved locally, therefore there were plans to reduce debts over the next five years.

The overall net balance was a combination of money spent on Early Years, all schools up to and including Year 11, the High Needs Block and the Central Services. The sum of this needed to be brought to zero. The potential reclaim on surplus balance was one of several ideas that could be brought forward, and the Forum would have to make some tough decisions for the coming year to get the trend down. The Chairman said it was likely that surplus money would be spent in areas that were not needed if surplus sums were taken from schools.

The Members noted the contents of the report and approved the deficit carried forward.

RESOLVED UNANIMOUSLY: That the deficit balance on the Dedicated Schools Grant reserve to be carried forward to 2021-22 be approved.