Agenda item

Mr John Simmonds, Cabinet Member for Finance and Ms Lynda McMullan, Director of Finance will attend the meeting between 10.15am and 11.00am to answer Members’ questions on this item.  

Mrs Sarah Hohler, Cabinet Member for Children, Families and Education and Mrs Rosalind Turner, Managing Director Children, Families & Education will attend the meeting between 10.15am and 11.00am to answer Members’ questions relating to the funding for academies contained within this item.

Mrs Hohler, Mr Simmonds, Ms Carey, Ms McMullan, Mr Abbott and Mr Wood were present for this item.

(1)   Ms McMullan explained that she would be taking on the role for the South East lead for Finance, which would involve being a representative for the South East Strategic Authorities.  Mr Manning asked for clarification on how this role might unfold.  Ms McMullan explained that the Council was offering its services and was waiting to see how other Authorities wanted to engage with the Council, useful debates could be had about what would actually make a difference.  Mr Christie asked whether this was the most appropriate time to be taking on additional roles, Mr Simmonds explained that it was important to share experiences and find the best way forward in the difficult economic circumstances, combining efforts would ensure benefits for Kent County Council.    The Chairman stated that presumably the Council were looking for cuts which would have the least effect on the residents of Kent so sharing best practice would be beneficial, Mr Simmonds explained that the Council was analysing the ways in which the services were delivered and looking at best practice in other authorities.  There were opportunities to work with other authorities and organisations and the Council was constantly looking at ways of delivering services in a more effective and efficient way.

(2)   In response to a question from Mr Christie, Ms McMullan confirmed that the same offer was made to the previous Government.  Meetings were held with Michael Lyons and there was input jointly across Kent into the comprehensive spending review.  

(3)   In response to a comment from the Chairman about conflicting evidence in the media and the effect of academies on the Local Authority.  Mrs Hohler explained that the Council faced a challenge and opportunity to think about how services were delivered without affecting standards.  The in-year cuts were particularly challenging.  A restructure was ongoing in the Children, Families and Education (CFE) Directorate to meet existing budget pressures and throughout this the staff had been resilient and patient.  CFE had a core budget of £213million which included special needs services, training and services provided to schools for example, there was not a lot of flexibility within the CFE budget because most of the budget was ring-fenced as Direct Service Grant. 

(4)   There had been an invitation from the Government to all schools to register their interest to become ‘new academies’ online.  If a school had been judged as outstanding by Ofsted it could fast track to becoming an academy.  A number of schools expressed interest and one issue of concern was transport and how it would be provided, if new academies changed the school hours or term times this could have huge implications on KCC budgets as the transport provider.  It was a complicated picture that was constantly changing. 

(5)   The Council had written to all schools to offer to discuss their issues, problems and concerns.  The discussions had to date had been useful and productive and Governors had asked lots of questions. 

(6)   The Chairman asked about the differences to the school budget, what information had been shared with the Headteachers at this stage.  Mr Abbott circulated to Members a presentation which had been given to Headteachers on the budgetary issues.  The picture was moving on a daily basis, but currently if a school elected to move to academy status it took its existing formula budget and this remained linked to the Kent formula.  A share was then taken of the centrally retained budget.  An academy took its share in line with the current Department for Education (DfE) methodology for 16 of the 32 budgets that made up the 8.7% share of the budget (pro-rata per pupil head).  There would also be an additional top-up from the DfE in recognition of essential services schools should be involved in.  As well as a grant for VAT and an insurance top-up as schools would no longer be able to get insurance from the local authority.  There was also an assurance that as a school moved to academy status it would look to partner and support neighbouring schools, there was no additional funding for this at present.  If every ‘outstanding’ school in Kent moved to academy status £1.9million would be lost.  The principle by which a budget was allocated to an academy was on a per pupil basis, this was problematic in terms of methodology and pressures and would be discussed further. 

(7)   The Chairman asked whether the attainment of academy status involved consultation with parents or the community surrounding the school.  Mrs Hohler explained that consulting the community and parents was not formally in the process, however the schools and governors were encouraged to consult with the parents and communities.  The Government had offered £25,000 to each school moving to academy status to help with the legal fees and transfer costs, but there were queries over whether this was enough.  

(8)   Mr Christie explained that in his experience parents were concerned about being unaware about the future of their school and whether it would become an academy at the end of the year.  It was essential that Members were kept informed to allow them to share information with concerned parents.  Did the Council know which schools in Kent had applied for academy status? Was the Council suggesting to the Government that the move to academies was too quick, that the process should slow down and that there should be greater consultation with the public?

(9)   Mrs Hohler explained that when she met Mr Gove before the election she had explained that the name academy was confusing and that the Ofsted criteria was a crude measure.  There had been some excellent Member briefings and the Cabinet Member for Education had written to Members to brief them on the current situation.  The timing was difficult at the end of the term, it was critical that parents were kept informed and many Governors were putting the academy idea on the backburner until further information was available and there was the opportunity for consultation. 

(10)          In Kent over 70 schools had been judged as ‘outstanding’ and could therefore be fast tracked, at this point two schools had begun to proceed to academy status and these were Fulston Manor School in Swale and Castle Community College in Deal.  Collaboration between schools in Kent had been excellent, the Cabinet Member was pleased that schools were being encouraged to work together and to support each other.

(11)          Mr Manning asked what happened if the scheme failed and what liability did the Council have.  Mr Abbott explained that the Council’s liability, as far as it was understood, would be nothing as the school would be an independent academy.  It was currently assumed that transport issues would remain with the County Council, however financially the school would stand alone.   School reserves, loans, standards and leadership issues were still to be resolved with the DfE. 

(12)          Mr Chell asked about the latest budgets for schools, was it possible to firm up the second and third year budgets.  Projected budgets were based on a zero increase and until the results of the comprehensive spending review in September were published no further information was available. 

(13)          Mr Jarvis expressed his concerns about the speed things were progressing, there was the potential for money to be wasted.  Mrs Hohler explained that it was difficult to predict whether the Government’s policy on schools would save money in the long term.  Regarding free schools there were concerns that transport issues in a county like Kent would be extremely difficult to maintain. 

(14)          Mrs Rook asked why only the outstanding schools had been invited to become academies.  Were the outstanding schools who were expressing an interest in becoming an academy expecting Building Schools for the Future (BSF) money, and why couldn’t an academy claim back VAT.

(15)          Mrs Hohler explained that it was not clear why only outstanding schools had been invited to become academies.  In relation to BSF, a school had had reassurance from the DfE that expressing an interest in becoming an academy, whilst in a BSF wave, wouldn’t have an effect on the BSF funding, which was surprising although issues were still to be resolved.  In relation to VAT Mr Abbott explained that the legal basis of academies set them up as companies and therefore they had to pay VAT. 

(16)          Mr Christie asked, accepting that it was not on the agenda, for clarification over free schools and their implementation timeline.  Was the Cabinet Member for Children, Families and Education prepared to use the political weight of the Council to ask the Government to slow down the process?  Mrs Hohler confirmed that the implementation time for free schools was September 2011, and it was important to use Members to listen locally and make the Council aware of any groups in the County who might be thinking about setting up a free school to allow the Council to have a dialogue with such groups.  A joint letter to Mr Gove expressed concerns that the Council did not want unintended consequences from the process, a series of questions were also asked but no reply had been received and there were still a lot of unanswered questions.  The Chairman explained that she had received a request via the LGA for comments, suggestions and views from local councillors about the proposals and a briefing had been requested from Mrs Turner on the issues surrounding the proposals.

(17)          Mr Hotson stated that to date only 2 of the county’s 70 outstanding schools had expressed an interest in becoming an academy, it was necessary to wait and see how the process unfolded and it would be helpful if an appropriate Committee would monitor and have an update on the progress, particularly in relation to the relevant budgets.  Mrs Hohler explained that to date Members had been briefed by letter, with email links, this issue was also on the agenda for the relevant Children, Families and Education Policy Overview and Scrutiny Committee for 20 July. 

(18)          Mrs Law expressed her concern about the schools that might be left behind, how was it possible to raise the standards in schools that had not achieved outstanding in their Ofsted inspection.  Mr Abbott explained that there was nothing more substantial at this stage but one of the clear messages from the Government was that they were looking to make better use of the pupil premium.  For schools that remained with the local authority it was important to ensure that the current restructure worked through the issues.