Cost of living: Schools with healthy reserves face budget pressure

Higher electricity bills and raising cash to pay staff is still a problem for a school with a million-pound buffer, the principal said.

Ysgol Friars in Bangor, Gwynedd, has taken over £974,000 from last year, as figures show the pandemic has left school reserves behind across Wales.

A union called the numbers a “smoke screen” because most of the reserves are earmarked for specific projects.

The Welsh Government said it recognizes the pressure on public services.

A recent survey of school leaders found that pressure on school budgets could lead to staff cuts across Wales.

Ysgol Monks leader Neil Foden said the 1,400-pupil secondary school’s electricity bill had doubled.

“That will probably cost us between £45,000 and £50,000 this financial year, with a significant increase in the following financial year,” said Mr Foden.

The cost of just about everything — from maintenance to copy paper — has gone up, he said.

But he said his biggest concern was where the money would come from to pay a 5% increase in teachers’ salaries and the salaries of other staff.

Salaries make up about 80-85% of the total school budget.

A union has warned of possible layoffs, which Mr Foden has ruled out for his school.

But he said he expects tough decisions for some schools in the long term.

“I wouldn’t be at all surprised if by the end of the 2023-2024 school year there will be schools that are laying off staff, both teaching and non-teaching,” he said.

Ysgol Friars is one of nearly 1,000 schools in Wales to have more than 10% of their spending in reserve at the end of March 2022.

Overall schools had reserves of £301m, equivalent to £659 per pupil, up from £32m in 2019-20.

Mr Foden said that bringing nearly a million pounds into this financial year was “absolutely unknown to us”.

“Under normal circumstances, you wouldn’t even dream of a scale that big,” he said.

Partly a quirk of the pandemic, schools spent less on bills during the shutdown and received a refund when exams were cancelled.

Additionally, additional Welsh Government grant money awarded at the end of the financial year also boosted budgets.

“But it’s already gone down,” Mr Foden said, explaining how the renovation of the school library and the hiring of counselors to meet the increased demand for mental health support since the pandemic had left a big dent in hard cash .

The principal believes reserves could help as a short-term ‘financial buffer’ for higher-cost schools.

But 44 of Wales’ 1,479 schools started the financial year in the red.

The Association of School and College Leaders said the reserves mainly consist of funds for specific projects, not ongoing costs like covering salaries.

Eithne Hughes, the union’s director in Wales, said it was “a bad state of affairs” if the funds earmarked for the Covid recovery were used to “prop up the whole education system”.

She called it “a smoke screen to hide the fact that we have a real and significant funding problem in our schools.”

“Some of the things they’re going to do is they’re going to try to downsize, and once they downsize, those classes are going to be bigger,” she said.

“I’m hearing from some schools where those class sizes will be up to 38 at the secondary level.

“It’s just unbearable now.”

A recent survey by school leaders’ union NAHT Cymru indicated that many of their members are considering downsizing.

Hywel Parry, head of Ysgol John Bright Secondary School in Llandudno, Conwy County, said financial planning is difficult when there is so much uncertainty about utility bills and other costs.

“We are now looking at potentially catastrophic budget cuts,” he said.

“At what stage are we unable to continue providing safe education to learners under the proposed cuts?

“It just adds to that impending sense of doom.”

Hugo Hutchison, principal at Monmouth Comprehensive School, which has 1,700 students, said principals were concerned about the warnings they were hearing about cuts.

“We have invested tremendously in supporting wellbeing – recovering from the pandemic and caring for the mental health and wellbeing of students and staff,” he said.

“No school could afford this measure if we had the cuts that are currently being discussed.”

The Welsh Government said it recognizes the financial pressures of inflation and energy costs on public services and is calling for more funding from the UK government.

A spokesman added that “the overall reserves of the school budget remain very high” and that local authorities and schools would be supported in their use.