Agenda item

(To receive a report from Mark Popplewell, Head of Finance – Children's Services, which provides the Schools' Forum with information regarding Lincolnshire's maintained schools carry forwards at 31 March 2017)

Consideration was given to a report from Elizabeth Bowes, Strategic Finance Manager, Schools Finance Team, which provided the Schools' Forum with information regarding to Lincolnshire's maintained schools carry forwards as at 31 March 2017.

The Strategic Finance Manager, Schools Finance Team guided the Forum through the report, and highlighted that Maintained Schools were permitted to carry forward underspends from one year to the next, subject to the provisions of the Local Authority's school carry forward policy.

Information relating to the school carry forwards for 2016/17 was detailed on page 47 of the report presented.  The report highlighted that for all sectors the average carry forward was 4.74%; and that the policy introduced on 1 April 2004 allowed primary and special schools to carry forward for any purpose up to 8% of their budget share, or £30k (whichever was greater) and that nursery and secondary schools could carry forward 10% and 5% of their budget shares respectively.  It was highlighted that additional sums could only be carried forward if they were earmarked for specific, costed, time limited, capital projects that were consistent with the priorities set out in the school's Asset Management Plan.  It was noted that schools that exceeded the carry forward policy were requested to complete a pro-forma detailing how the additional sums were to be spent.

The report highlighted that at the end of 2016/17 the number of schools with a budget share deficit was 49, (2 nursery; 41 primary; 4 secondary; and 2 special schools), which represented an increase of 28 on the previous year. 

Officers highlighted that as a result of the LA implementing a new financial system on 1 April 2015, this had resulted in a second challenging year for schools with the coding of their payroll costs between grants and budget share.  It was highlighted further that the number of schools with net overspends had reduced to 25 schools when considering the budget share and grants position overall.  The Forum was advised that the number of schools with net overspends had increased on previous years and it was recognised that the Dedicated Schools Grant had been cash flat for a number of years had contributed to the financial pressures schools were facing.  It was also believed that overspends could be attributed to a lack of regular budget monitoring, inaccurate forecasting; and the incorrect setting of school expenditure budgets.  As a result of the increase in overspends, it was noted that plans were in place to deliver extensive training for all maintained schools.

Some Forum members felt that the report presented did not accurately reflect the issues some schools had encountered with Agresso; i.e. having to run a paper based spreadsheet alongside the system; and to the fact some schools were still encountering some problems, particularly in relation to payroll issues.

Officers clarified that most problems with the Agresso system had been during 2015/16, and that during that period the LA had made some concessions.  It was highlighted that there was a medium term finance plan that had been in place for some years to assist schools in planning to deal with potential overspends.  With regard to Agresso issues raised, the Forum noted that this had improved however; there were still ongoing issues with payroll.  The LA was well aware of the impact the introduction of the system had had on schools staff; and acknowledged that the system was not working perfectly, but things were moving forward; and officers were content with the direction of travel.  

Appendix A to the report provided the Forum with a list of School Carry Forwards, including grants (Pupil Premium and Universal Infant Free School Meal) for 2016/17. 

A Forum member raised a question on what the LA was doing with schools with large carry forwards.  An officer advised that maintained schools were required to complete a proforma on its intended use in line with LA policy.  This was then reviewed by the LA and approved if acceptable, before the carry forward was released to the school.  The following year, the LA would review the school's financial reports to ensure that the works had been undertaken as prescribed in the proforma submitted.

RESOLVED

That the report concerning School Carry Forwards 2016/17 presented be noted.