Why next year's sums could be a disaster

Today's survey of education budgets by The Independent shows that this summer has become Groundhog Day in many of the nation's state schools.

It reveals that one in five schools is asking parents for extra contributions to help to ease funding problems. Margaret Morrissey, spokeswoman for the National Confederation of Parent Teachers Associations, reckons the results are an underestimate of what is happening.

The call for higher parental contributions mirrors what happened in the dying years of John Major's government - when cuts began to bite into essential items provided by schools. Hence the feeling this year is generating of Groundhog Day (the 1990s film in which each day was the same for the central character)

In a sense, though, the call for more parental contributions is not the most worrying aspect to emerge from our survey. The finding that one school in five has eaten up all its reserves this year and is dreading the impact of next year's funding settlement shows where the real difficulties lie.

We did not even ask questions on next year's funding. All we did was to leave a section blank for heads to comment on their position - and that is where this information came to light. It would not be unreasonable to suppose, therefore, that a higher percentage of schools might fall into this worrying category.

A survey of a limited number of schools cannot, by itself, be guaranteed to present a perfect picture of the impact of this year's funding settlement on schools. But we did seek to make the survey as representative as possible by contacting schools in every authority and our results reflect a wide geographical spread.

Even within the Department for Education and Skills, there is now an admission that the Government was slow to react to the impact of this year's funding settlement. The question now is what will happen next year.

Charles Clarke, the Secretary of State for Education, will promise later this week to try to secure a "reasonable" real terms increase in funding per pupil for every school in the land.

This will be difficult to achieve and will need the support of local education authorities (LEAs), which are still the final arbiters of which school gets what increase.

Mr Clarke will also be seeking much more central control over how LEAs spend their money. A battle is said to be going on in the Cabinet over whether to revert to a direct-grant system for funding schools from Whitehall - removing LEAs from the equation - but Mr Clarke's aides acknowledge that this would have to be a longer-term solution. A note of caution should be raised with supporters of this system: when this Government ended the Conservatives' system of grant-maintained schools, returning schools that had opted out of LEA control, some cases emerged of schools having frittered away their finances on perks instead of essentials. To monitor school spending from the centre is not as easy as it is with efficient local authority control of the procedure.

Mr Clarke is also pressing for a pay deal to cover two and a half years for teachers and for limits on performance- related pay rises for staff to give heads more control over the spiralling costs of meeting their salaries bills. His evidence to the school teachers' pay review body published last Friday shows that - if all senior teachers are allowed to move up the profession's upper pay scale with impunity - an extra £700m a year would have to be found. He wants to restrict the numbers proceeding up the scale to one in three. He also plans to give LEAs an early indication of the funding settlements for the next two years.

All this is to the good. But most of the headteachers in our survey and their leaders in the teachers' trade unions doubt whether financial stability will be achieved without an increase from Gordon Brown, the Chancellor, when he announces his comprehensive spending review settlement for education to cover the next two years.

The headteachers who see little hope for their schools

By Richard Garner

ANN HOLLAND HEAD, COTSWOLD SCHOOL, BOURTON-ON-THE-WATER, GLOUCESTERSHIRE

Ann Holland says she has "enormous worries" about how her school will cope with funding next year. The 830-pupil school, a co-educational comprehensive for pupils aged 11 to 18, has drained its reserves to zero to make up a £200,000 shortfall in this year's budget.

It has thus been spared the teacher redundancies, going round with the begging bowl to parents or cutting subjects from the curriculum that many other schools have faced.

But it has still had to increase the workload of its management team, at a time when the Government is boasting of its ground-breaking agreement with most of the teachers' unions to reduce workload from September.

Mrs Holland has also already had to cast a critical eye over expansion schemes. "This is a good and very successful school," she said. It was praised in last week's report by Ofsted, the education standards watchdog, for the way it has improved the performance of boys.

The difference in the proportion of boys and girls getting five good GCSE grade passes is only one fifth of that nationally. Yet Mrs Holland is anxious to pursue improvements. "We are an ambitious school," she said. "We want to improve our hard play area. We also want to expand the number of vocational GCSEs we offer. At present we only offer one (information technology) but we'd like to increase it to two or three."

The school's priorities could not be closer to those of the Government, yet Mrs Holland says the expansion plans have had to be put on hold.

JACKIE KEARNS HEAD, IMPINGTON VILLAGE COLLEGE, CAMBRIDGESHIRE

Jackie Kearns put her finger on the real problem that is causing the funding crisis in so many schools this year. The head of Impington Village College in Cambridgeshire was given what might seem a generous 7.2 per cent increase in the budget of the 1,400-pupil school.

But the cost of employing her teachers had rocketed by 20 per cent, through incremental pay rises, national insurance and pension contributions and a performance-related rise. Salaries are 96 per cent of the school's total budget.

The upshot? A £500,000 shortfall that will lead to staffing reductions and which could pose a threat to some of the ground-breaking innovations at this internationally renowned school.

Impington is one of the longest-established community colleges in the country, opening at the start of the Second World War and offering a range of opportunities for adults, including sports facilities, adult education courses and a workplace nursery. Now its 65-year-old tradition can be kept going only by franchising the operation to the local further education college and allowing it to take over.

In addition, its thriving sixth-form has acted as a magnet to international students and it is one of the few state institutions in the country to pioneer the international baccalaureate, the route that the former chief schools inspector Mike Tomlinson is expected to outline for the rest of the state sector when he publishes an interim report revealing the first thoughts of his inquiry into 14 to19 education on Wednesday.