Current proposals to reform the £5bn per year Scottish education system could expose schools to significant financial risks, because of a lack of the necessary skills and governance framework, according to CIPFA Scotland
The institute’s comments form part of its submission to the Scottish government’s consultation on ‘Empowering Teachers, Parents and Communities to Achieve Excellence and Equity in Education: A Governance Review’. The consultation closed on 6 January 2017.
CIPFA claims that the proposal to take schools out of local authority control means that Scotland’s 2,500 schools could be left without adequate direction, support and skills to manage their finances sustainably.
In its submission, CIPFA argues that the Scottish government will need to create new governance arrangements to support any reform. For example, if schools are to manage their own finances, independently of local authorities, then staff will need the relevant skills and expertise. This may mean the head teacher role will need to become more commercially focused.
In addition, how schools will access local authority reserves and how resources will be allocated directly to schools will need to be established. How future capital investment in schools will be funded will be a key issue, considering the Scottish public sector has limited borrowing powers, and the VAT status of individual schools will need to be addressed. There will need to be clarity on the future ownership of PFI/NPD assets valued at £4bn.
Don Peebles, head of CIPFA Scotland, said: ‘Without detailed plans to replace the financial management role of local authorities, schools could be left rudderless which would expose them to great financial risk.
‘The proposals also raise significant question marks over whether schools have the relevant skills and expertise to manage their own finances.
‘We hope the reform will bring about the desired change but CIPFA believes that structural changes alone will not deliver improvements to educational outcomes. We need only look to England to see how academisation has delivered a raft of failures in school governance and financial management, and has not succeeded in delivering any significant improvement in educational attainment.’
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