Contact: Sarah Pook, (01962) 847045; [email protected]

1 Summary

1.1 The following decision is sought:

That the Executive Lead Member for Children's Services (Education):

1. approves the proposals from Schools Forum to consider further changes to the criteria for claw back contained in the Scheme for Financial Management of Schools to take effect for 2008/09 balances.

2. Notes the decisions made on claw back of balances for 2007/08.

3. Asks for all County Councillors to be sent details from the Section 52 outturn related to the outturn balances for schools in their area.

2 Reason

2.1 School balances in Hampshire have increased again during 2007/08 by £5.8m. They now total £46.8m or 7.23% of allocations (these figures include early years balances). School balances have been under scrutiny for some time locally and nationally as this is money delegated to schools to spend on current pupils. Nationally the Department for Children, Schools and Families (DCSF) is looking to reduce balances to ensure delegated funding is delivering improvements in education for current pupils, the Audit Commission is reviewing the value for money of a system where funding goes unspent and locally there is a concern that as a low funded authority for education, increasing balances could be an adverse indication of need.

2.2 New powers were given to local authorities to help to encourage schools to develop their budget planning and reduce balances, these include a new power to claw back excessive, uncommitted balances. This claw back power has been exercised for the first time this year. Nine schools were proposed for clawback totalling £283,529. Schools Forum agreed to an appeals process such that schools could appeal to a sub committee of Schools Forum, ensuring that the proposals were subject to review by their peers. One appeal was upheld and Schools Forum confirmed the use of clawback for eight schools totalling £215,798 which represents an average of 1.27% of budgets shares for the schools involved or 3.48% of their balances.

2.3 School level detail on balances is published annually as the Section 52 return to the DCSF on the outturn position at the close of a financial year. Hampshire County Council's S52 return will be published in August for 2007/08.

3 Other options considered and rejected:

3.1 Other options have been discussed with Schools Forum. The key issue is the approach to the use of claw back and whether the intention in using it is to change behaviour in schools and their approach to budget management to encourage all schools to make full use of their revenue budgets for the current children or to recover significant sums from a number of schools. The former is the intended approach and hence the recommendations in this report are seen to support that route.

4 Conflicts of interest declared by the decision maker or other Executive member consulted - none

5 Dispensation granted by the Standards Committee - none

6 Reason(s) for the matter being dealt with if urgent - none.

Approved by: Date:

Councillor David Kirk
Executive Lead Member for Children's Services