As austerity continues to effect the education sector and the incidence of deficits and financial failure becomes more common, the focus on academy financial efficiency and sustainability becomes more and more pressing.
A method of financial resource planning that is becoming ever more popular is Integrated Curriculum Financial Planning, (‘ICFP’). This method essentially involves taking a ‘clean slate’ approach to curriculum planning by firstly clarifying: what are the educational needs of all pupils at the academy? The next question to follow this is: can we afford to run this curriculum? The purpose of balancing needs with affordability helps to ensure that the children are put first by effectively delivering the greatest good to the greatest many.
While these questions and considerations are not new, what might be different is firstly the fresh annual evaluation of whether the academy is meeting the needs of its students rather than just rolling forward the same curriculum year on year. Secondly, while balancing the budget has always been a primary focus, the use of a more analytical approach to considering curriculum affordability – with ratios that can be compared to other schools and trusts provides much greater scrutiny and a stronger basis for decision making.
The ratios and statistics applied by academies for considering financial health and curriculum planning do vary but the three at the heart of this method are:
- Cost per lesson (Broadly calculated as total teaching staff cost divided by number of teaching periods);
- Teacher contact ratio (Broadly calculated as average number of teaching periods divided by total number of periods); and
- Curriculum headroom/ bonus (Essentially a positive or negative statistic based on class size as a % of average class size)
The above calculations help to arm governors and leaders with clear information which can help answer key questions such as: what are the optimal number of periods? Are staff efficiently utilised? Are class sizes efficient? What are the costs of free periods of teaching staff? Is a new teacher needed? Is it viable to keep running a particular subject?
Such is the importance that has been assigned to ICFP that the DfE has made the introduction of this method a condition of grant funding for recipients of the MAT Development and Improvement Fund. To help trusts introduce ICFP, additional funding grants are being given, (‘ICFP Funding’) to buy in an external, independent service to evaluate the Trust’s financial efficiency and make recommendations for improvement. This external evaluation is completed as Annex K of the grant offer letter.
We are available to help trusts with this review and believe that we can provide a very useful pair of independent, fresh eyes. If you would like further information on how we can help you, please do get in touch with our Academies & Education team.