The TES is reporting exclusive new research that, they claim, suggests state school debt is on course to more than double in just two years.
TES asked local authorities in England and Wales how much money maintained schools had asked to borrow from them to cover their budget deficits in each of the past three years.
Results came in from more than three-quarters of the councils – 137 of the 174 – and the numbers paint a worrying picture. The total amount they gave schools permission to borrow rose from £35.8 million to £51.7 million between the 2013-14 and 2014-15 financial years.
In November, the total for 2015-16 already stood at £56.7 million, with nearly half the financial year to go.
The figures, obtained under the Freedom of Information Act, also reveal that the average permitted deficit per school is now £122,828, approaching double the £66,580 figure from 2013-14.
“The cost pressures on schools are really biting,” said Malcolm Trobe, deputy general secretary of the Association of School and College Leaders union…
See more on this in today’s edition of TES
I’m not an accountant by my understanding of deficit is that it is the additional debt an institution incurs over a single year, rather than the total debt (which is the sum of all deficits and surpluses).
The article seems to use debt and deficit as the same thing but is actually talking about deficits, not overall debt. It would be very interesting to also know what the total debt/surplus levels are.
For example, a school running a deficit of £122k (the average permitted amount reported above) could run up a total debt of half a million pounds if it borrowed at this level for just 4 years. However, this is an average figure that covers small primaries and large secondaries, so no doubt the levels at the higher end are considerably greater.
How significant are these figures compared to overall budgets and what do you think the extra borrowing is being used for?
Also, these are figures for maintained schools, how would you see things for academies?
Please give us your insights and opinions in the comments or via Twitter…
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