As the landscape of education changes & most schools become self-managing academies, the future funding of education is set to be increasingly challenging.

With the announcement, prior to Christmas, of the potential required cuts to the school’s budget of £3bn by 2020 is it time for a fresh look at how schools operate financially?

With most long established institutions, the ability to change and examine new ways of operating is a challenge.  With the landscape of education changing whereby most schools will be academies and therefore self-managing, compounds this challenge.

As today’s report states, approximately 60% of secondary schools will be or are currently operating in deficit, there is a radical change needed to manage the operating expenses of any school.  Worryingly the call seems to be from the sector is that this will result in staff cuts.  Whilst it is inevitable that some staff cuts will take place due to the size of the required cuts there could be other areas of opportunity that can be realised.

Having worked with a variety of schools and institutions we are often faced with a reluctance of “changing from what we have always done”.  The reliance on existing recognised buying clubs and council run procurement activity has not produced the required savings or efficiencies that schools require to meet the future demands of expenditure cuts.

Whilst dealing with some schools that are open to change, we have been able to use our experience from other sectors in how we have optimised operating costs. Whilst commercial businesses recognise the need for outside expertise, the school’s environment seems reluctant to accept this.

Suppliers are keen to work in the education environment but are often prohibited due to the use of framework agreements or OJEU.  Therefore, the availability of alternative sources of supply and a challenge to existing costs may be limited again making the challenge of cutting costs difficult.

Commercial businesses have long faced the challenge of ensuring costs are comparable to income and it could be argued (as I have on previous blogs) that schools must now operate in a similar manner.  This and, I believe, any future government need to balance the fiscal budget and therefore this challenge will not diminish but will increase.  Schools need to look at new ways of operating and explore services that are outside of the existing ones that have been used. As a wise man once said;

“If you always do what you’ve always done, you will always get what you’ve always got” in the case of schools this could be a £3bn budget gap.