Add real value to education

In these hard economic times, the government should save money by ceasing the endless stream of initiatives aimed at schools and colleges and concentrate on the core purpose of teaching and learning, says John Dunford.

'Doing more with less' is a phrase that I am starting to hear more often in Whitehall. It is what all public services will be expected to do over the next few years.

There are three strong indicators of a less rosy financial future for schools and colleges.

Firstly, we have long known that the government's spending review for 2011-13 would be less generous than recent ones. Public expenditure simply cannot continue to grow at the rate of the last ten years. There is even a view that, in this climate of uncertainty, the review may be postponed until the situation is clarified.

The second factor, and very much an unknown quantity, is the medium-term effect of the credit crunch. Sometime, somehow, the bail out of the financial sector needs to be repaid and public expenditure will undoubtedly pay its share of that price, perhaps over a very long period. It is possible that the government will get a good price when it sells its recentlyacquired share of the banks and that will offset some of the bad news.

Thirdly, and by far the clearest indicator we have had, was the Budget statement on 22 April which protected education budgets for 2010-11 but indicated a very different situation from 2011-12 onwards.

There is, of course, also the possibility of a change of government in 2010 with all the financial uncertainty that that brings.

Some commentators believe that the extent of the economic gloom has been over-played and that there need not be the level of retrenchment in public services that is widely anticipated. If the UK can increase its growth, revenue will increase to the Treasury and less will be required from tax rises or public expenditure cuts.

On even the most optimistic predictions, however, the years of plenty for education expenditure are over, at least for the foreseeable future. Yet public expectations of the education service will continue to rise. People want education to improve every year and governments of all colours reflect that in their increasing demands on us.

Doing more with less is unavoidable. What are the implications? And is there anything we can do to prepare?

Better procurement on ICT

Perhaps a better mantra than 'doing more with less' would be 'doing better with less'. In a world without real-terms funding increases - already a reality in many schools and colleges - and even real-terms cuts, it isn't sensible to pretend that we can expand activities into new areas.

Schools and colleges have already cut out many of the inefficiencies that had crept in during the years of plenty, although there are still savings to be secured through better procurement on ICT and utilities. Doing better with less means focusing on what we are doing already and doing it better.

Equally, we have a right to expect that the government will make savings by refraining from introducing lots of new initiatives, instead letting schools and colleges focus on the core mission of learning and teaching.

That means a move away from an announcement a week, many with bits of funding attached. This money needs to go into core budgets, so that schools and colleges can decide where to spend the money for optimal results.

ASCL members who were leading schools and colleges in the second half of the 1980s and 1990s have experience of managing with declining resources. Benchmarking became a popular activity as we tried to squeeze as much as possible out of diminishing resources. A high proportion of ASCL members, however, have only been in leadership during a period of expanding public finance. There will be much to be learned.

According to Robert Chope of the Institute for Fiscal Studies (IFS), the hole in the Treasury's finances is likely to be of the order of £40 billion per year by 2015. In addition, the government is facing a possible loss of £130 billion on the rescue of the banks. Servicing the debt will take a sizeable slice of public expenditure.

The IFS estimates that measures put in place by the Chancellor, such as the rise in National Insurance contributions from 2011, will go halfway to meeting that debt.

There are only two ways to fill the hole - raising taxes and decreasing public expenditure - although economic growth also eases the deficit. The first is always politically unpalatable, so it is certain that spending departments, such as education, health and defence, will bear the brunt of providing a solution.

According to George Osborne, the shadow chancellor of the exchequer, the government's plans for 0.7 per cent growth in public expenditure are too generous. He said on the Today programme on 6 April that the Conservatives "will have to make difficult decisions in this area", including public sector pay and pensions.

Vince Cable, the Liberal Democrat Treasury spokesman, has said that public sector pensions will have to become less generous, although it is difficult to see how that can have any effect before 2015, since pension reform is always so long term.

Of direct interest to ASCL members, George Osborne also referred to high salaries in the public sector, such as those earned by local authority chief executives and quango bosses, saying that he "wants to send a powerful signal that the age of excess is over".

School and college leaders earn every penny of their salaries, which are by no means high in comparison to their responsibilities, so ASCL will be watching Mr Osborne's announcements carefully.

Threat to BSF

David Laws, the Liberal Democrat education spokesman who has considerable experience in the financial sector, has said that the cost of debt interest and unemployment benefit alone will mean a 2 per cent decrease in expenditure on public services.

A government looking for major savings in the public sector is certain to look at very expensive items such as ID cards, Contactpoint, Trident and the raising of the education leaving age, he believes.

The most obvious candidate to add to this list from education is the Building Schools for the Future (BSF) programme, which we shall have to fight hard to preserve for those further down the queue.

The sting in the tail of the 2009 budget was the determination to make a 1 per cent efficiency saving across the whole service. Any increases that are made to school budgets will therefore have to be seen in the context of this saving.

There are implications here too in terms of difficult decisions for local authorities: for example, closure or federation of small schools or cutting back on out-of-authority special needs provision.

Those schools with high unit costs will need to take action to reduce them. Where steps are not taken, there will be repercussions for other more cost-effective schools to suffer reductions.

There are similar and very tricky implications for the commissioning of post-16 provision and cost effective delivery, which may spell the end of small sixth forms.

During this period of concern about the financial situation, ASCL will be a strong voice warning about the dangers of cutting back and articulating the benefits of investment in education during a time of economic difficulty.

I said in my address to ASCL's annual conference in March, that "in such dire fiscal times, education is more important than ever. The future of the country literally depends on how successful we are in developing the talents and skills of our young people.

"We must hope that the credit crunch will bring change not only in the value of our shares, but in the values of our society; a change from the foolishness of toxic loans and the selfishness of huge bonuses to a stronger recognition of our shared professional commitment to the welfare and life opportunities of others that are at the heart of the value set of ASCL members."

The government must invest in our schools and colleges and we will produce the young people that society needs in the future.

ASCL will continue to persuade the government that it needs to use money efficiently. In particular, that means stopping all the pilots and initiatives that soak up a few million here and several million there. We shall tell the government that it needs to help us to focus, not diversify - and that means putting more into core budgets and less into a rainbow of initiatives.

ASCL will also promote the importance of bursars and business managers in schools. At a time when good financial planning and efficient use of resources will be paramount, these senior support staff will really come into their own.

Finally, ASCL will do its best to provide the support that members will need to get through this difficult financial period successfully, doing better with less, and doing it effectively and efficiently.