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Lincolnshire schools put aside cash for pay rises

By Lincolnshire Echo  |  Posted: October 13, 2012

Schools have been thrifty in recent years, in anticipation of pay freezes being lifted

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Schools have stockpiled millions of pounds in preparation for a huge bill when pay freezes are lifted.

Local authority-funded schools are permitted to carry forward what they have not spent in one financial year to the next, under Lincolnshire County Council's financing scheme.

A new council report has revealed that governing bodies undertook a more prudent approach with their last budget.

Nearly £20 million has been saved by primary, secondary, nursery and special schools in the county combined, which was added on to their 2012/2013 budgets.

This is an increase of £8.621 million – or 76 per cent – from 2010/11's underspend of £11.357 million. The county council believes that one of the main contributing factors to schools taking a more frugal approach is the current public sector pay freeze.

Although the Government's Comprehensive Spending Review allowed for a growth in school funding, there was no cash put aside for schools to issue their staff with pay awards.

This means that if the Government announces a pay increase for teacher and staff salaries, then the schools will have to foot the bill themselves.

And as the bulk of a school's budget is spent on staff, it is believed many schools have taken the decision to squirrel away extra funds in preparation for when pay freezes are lifted. Some schools, however, could be building up reserves of funding to finance new project and pay for new equipment.

Tony Warnock, the head of finance for the county council's children's and specialist services, said that it was wise for schools to take such a sensible approach.

He said: "We do believe that the money given to schools each year should be spent on the pupils.

"However, we also think it's prudent to carry forward a reasonable level of reserves.

"For primary, nursery and special schools we advise reserves of around 8 per cent, but for secondary we say 5 per cent.

"Anything above that means we ask that the money is earmarked for other projects.

"Our local authority schools are all operating in a sensible manner."

St Peter in Eastgate school, Lincoln, saved the most out of any primary school, with 29.25 per cent of its annual budget, equating to £125,916, while Gainsborough Nursery was the most frugal nursery school, saving 28.49 per cent, or £104, 950.

Jule Holmes, 48, a mum of two from West Parade, Lincoln, said: "Although it would be nice to see that money spent on the pupils, on something like computer equipment or trips, I'd rather know that the schools are staying financially secure."

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