Local authority schools face financial 'meltdown,' says study

Schools that stay under local authority control face financial "meltdown" as a result of the Government's drive to boost the flagship academies programme, a study warns today.

Schools have been told they will get extra funding if they opt to become academies - with cash held by councils to provide services like special educational needs support and truancy officers passed on to them.

However, a "ready reckoner" produced by the Department for Education showing how much each will get reveals some will get substantially more than others.

In Islington in north London, for instance secondary schools will get £1,322 per pupil while in Buckinghamshire the figure is only £217.

This is because authorities differ widely in the way they calculate how much cash they hold back from schools.

In some, the overall cost of administration and of other children's services is included in the calculation.

The upshot, according to local government expert Martin Rogers, is that these authorities would lose so much cash if schools opted out that they would face "a financial catastrophe".

Mr Rogers, who has produced a study on the situation for the National Union of Teachers, added: "One authority said it would face meltdown if a number of schools opted out."In others, it could also pose a financial catastrophe as they have to cut the budgets of the school that remain with them as they lose cash. It could lead to cuts in other services that they run.

"I think undoubtedly it does act as a bribe to schools to become academies but I don't think it's intentional."

The most likely scenario was that the academies themselves would face cuts in the year following their decision to leave council control as Education Secretary Michael Gove would be unable to sustain the extra finance because of the pressure for public spending cuts.

Christine Blower, general secretary of the NUT, added: "Already the unforeseen consequences of the government's adventure with academies are emerging.

"The Government's approach to funding means that schools that remain with local authorities will be faced with major cuts, as will children's services which have nothing to do with education.

"In short, both schools and local authorities will face meltdown because of the Government's chaotic funding arrangements for its unacceptable academies scheme."

Mr Gove wrote to all schools after the election urging them to consider becoming academies. Those declared "outstanding" as a result of their Ofsted inspection will be able to automatically transfer to academy status from September.

A spokesman for the Department for Education said: "The effect of academy conversion on local authority services is something which the department has under consideration and expects to discuss with local authorities shortly.

"But the calculator (ready reckoner) is about funding paid to academies, not the effect on local authorities. Only some of this money is recouped from local authorities, the rest comes from other funds."

Meanwhile, more than 22,500 university jobs will be lost in England alone if the Government pushes ahead with 25 per cent budget cuts, a union warns today.The University and College Union says this would lead to some of the largest class sizes in the developed world - threatening the UK's position as the second most popular destination in the world for foreign students.