Sharon Wallwork provides comprehensive advice on dealing with a decline in student numbers. She argues that, far from being something that only schools in specific circumstances should be concerned about, all educational institutions need to assess the risks of declining numbers and the huge financial implications this can bring
A GROWING CHALLENGE faced by our schools today is how to lead the school successfully through a period of falling numbers on roll. This has more often been an issue facing the primary sector but, inevitably, will affect the secondary schools in the years to come. The impact of falling rolls is far-reaching. As well as the obvious budget cuts, there will be other repercussions that will need to be planned for and managed strategically to avoid impeding the school’s development. A combination of long-term business planning and stringent management will be needed in developing a strategy to overcome this risk.
Causes of falling rolls
The face of education is changing as a result of government initiatives and the reshaping of children’s services, particularly following the launch of Every Child Matters. Combine this with a national fall in birth rate and it is all too obvious that school structures will be affected. With the exception of over-subscribed and selective schools, the drop in birth rate will quickly be felt in schools and will lead to increased competition between neighbouring establishments, all of whom are eager to attract the declining school age population. This will have a less immediate effect on oversubscribed or selective schools, although they may experience a decline in, say, academic achievement resulting from a smaller field of students to pick from. The main causes of falling rolls include:
- decline in birth rate, reflecting the national trend
- re-organisation of local schools – often following a local authority review of places available. In some cases this has led the authority to reduce the school’s PAN (pupil admission number)
- parental preference – an increase in ‘parent power’ has allowed parents more freedom of choice over their child’s school
- neighbourhood migration – closure of a local industry may lead to mass localised unemployment, forcing families to leave the area in their search for employment.
Usually the fall in roll will be gradual and a downward trend will be apparent by reviewing the termly data collection and school census information. However, the school should not delay in considering the impact of a continual decline and should, at an early stage, consider the options for the future and prepare a business continuity plan. Remember, this is only a plan and should numbers pick up again no further action may be necessary. However, the fundamentals of risk management are that we should identify the risks and be prepared with control measures to minimise damage.
Risk management is paramount
Schools, as public funded bodies, are traditionally low risk-taking organisations and resistant to changes in areas beyond the curriculum. However, falling rolls are one risk that cannot be ignored and the school must look for ways either to capitalise the drop in numbers to its advantage or, where this cannot be done, to alleviate the ensuing problems. A risk-mapping exercise should be conducted to ascertain both the impact of a fall in rolls and the probability of it happening/continuing. A high-impact, high-probability risk calls for risk mitigation to reduce the severity of its effect. Avoidance is not an option.
Business continuity planning
The plan will show the school’s current strategy – how is it managing the finances, the class structure, and the staffing levels. The school should look to its vision and values and decide whether these are appropriate in the current times. The plan should then look ahead to predicted future numbers and the implications on income directly linked to student numbers, and expenditure, in particular staffing costs.
Risks faced by the school should be identified and considered. These may include:
- overprovision of school places in the area resulting in competition from neighbouring schools
- financial pressures, for example, increased costs of teaching staff moving through threshold
- the risk of highly valued, key staff moving on to more up-and-coming establishments
- senior staff ‘biding time’ until retirement
- competition from local diversification and extension of services, eg neighbouring schools offering out-of-hours facilities such as extended childcare provision
- resistance to change.
The school managers and governors should discuss the appropriate approach to control these risks, examining the school’s approach to risk-taking.
Options for the future should be identified. Should the school resize, for example scaling down from say a two-form entry primary to single-form entry in the coming years? The alternative could be to diversify, perhaps offering extended services such as a children’s centre or a base for healthcare provision. The school managers may need to think outside the box to utilise the resources they have, primarily the buildings and the links with the community, to find an additional income source to replace that lost from falling numbers.
A timescale for proposed scenarios should be established. This must be carefully linked to the staffing model of the school in order to plan for retraining or, indeed, redundancies. Progress needs to be monitored and evaluated, with the plan reviewed or revised as needed.
Management needs should be identified, with particular regard to individuals’ roles and responsibilities. A project team should be formed, the members having the appropriate decision-making authority. An example of this would be headteacher, bursar or senior administrator, other senior manager, together with a representative from the governing body. At all stages the plan must be monitored and progress should be evaluated. The plan is not ‘set in stone’ but can be revised as necessary or in response to changes in external factors.
Constructing your business continuity plan
1. Collect information
A strategic information collection exercise needs to be undertaken to determine the appropriate analytical approach needed to effectively inform and assist strategic planning. Data should be collected about the school, its community, the service it offers, the current environment and, as far as possible, the view of the future environment. Analysing this information shows what stakeholders consider to be important about the school and its future, and provides facts and figures to support decision-making. School managers will need to set goals for the future and all decisions made and changes introduced should be in support of these goals. It will not be an easy task and there will be a need to act sensitively. In the worst case scenario there may be staff redundancies which inevitably lead to a huge drop in morale.
2. SWOT analysis
An analysis of the strengths, weaknesses, opportunities and threats facing the school, both now and in the future, facilitates divergent thinking. This exercise may identify many valuable strengths and opportunities, but also highlights significant threats facing the school. Strategic thinking is needed; both to minimise weaknesses and to respond to threats which otherwise may lead to the eventual demise of the school. Those aspects of the past which are currently useful to the school and would be expected to continue into the future need to be drawn on and adapted to support the changing direction of the school. In recognition of the need to strike a balance between short-
and long-term thinking the project team should meet for a ‘strategic seeing’ exercise.
This is a chance to see ahead: to brainstorm future direction of the school and possible courses of action, simultaneously being aware of current needs. Look holistically at the school, its relationships and ways of working, delving into these to identify where there is potential for change which supports the future of the school.
3. Pestle analysis
Pestle analysis, although less-commonly used, is a very beneficial management exercise used to assess the significance of various factors relating to the risk (in this case the risk of falling rolls). It helps to identify possible actions required to minimise the adverse effects. The project team get together and brainstorm ideas and information. Trends and factors identified should be grouped into the Pestle categories – political, economic, social, technological, legal and environmental. These can be recorded in a table with suggestions for required action. For example, a look at the social issues facing the school may highlight an increase in behavioural problems. The school could liaise with the local authority behaviour support team and offer parenting or family support outreach sessions. Another growing trend is childhood obesity and you may be able to work in conjunction with the local health authority, offering nutrition advice and obesity clinics or seek funding for a healthy breakfast club. Any of these activities can attract funding and utilise otherwise empty classrooms.
4. Consider available options
All available options should be considered, however diverse they might first appear. Thinking laterally may lead to a solution hitherto not thought of. In extreme cases, bold action or radical diversification may be the only way to secure a future for the school – albeit in a totally different form from the current set-up – ‘You can’t cross a chasm by taking small steps’. The options may be unappealing – after all, what headteacher wants to downsize his school (and maybe his/her earning potential!). However, if well-managed, a long-term plan can lead to successful outcomes. There is no set list of options. Each school is at the mercy of very different factors but, conversely, each school can draw on its individual strengths and move forward. Options may include:
a) Downsizing
The school accepts that numbers are in decline and plans to move forward with a different entry set-up and reduction in planned admission level (PAN). This should be agreed with the local authority who will need to do a local consultation exercise, projecting anticipated student numbers into the future.
Class sizes and structure will need to change, taking account of DfES class size restrictions. Vertical integration (mixed year groups) may need to be phased in for the affected key stage(s). This may be unpalatable to the teachers as it will affect their planning and curriculum delivery – a Year 1 teacher may have to teach a mixed class of Year 1 and 2 students.
If, as in this example, the only option is to downsize, then the staff should not only be kept informed, but should also be able to contribute to the planning process. The school management must recognise that staff will be unsettled and worried about their own future, and involving them in decisions which may affect them directly will help reassure and, in fact, retain the staff.
Of course, a smaller school requires less staff, both teaching and support, so redundancies may be inevitable. Also, as the number on the school roll reduces, consideration may have to be given to deputy head release time or even headteacher teaching commitment quotient.
Redundancy is usually a last resort, both for financial reasons and in recognition of the massive blow to staff morale. As soon as the decline in roll is accepted as a continual trend the school’s managers should be thinking even more carefully with regard to recruitment. This is a valid time for the use of temporary contracts, but be sure to word the contract carefully to reflect this clearly. As always, when issuing temporary contracts, take advice from your human resources advisers. Keep them informed from an early stage as they will be needed if you have to go down the redundancy route.
Where possible, do not commit the school to long-term financial agreements which will be an extra burden when working with a reduced budget. If you can get by without a new photocopier, for instance, don’t sign up to a five-year lease! School leaders and bursars are experienced in balancing the demands of the school within the budgetary constraints but now this will be even more of a challenge. This will be more of an issue in the early stages of downsizing as, once the numbers and staffing structure have stabilised at the lower level, budget planning and monitoring should even out. You will need to involve the local authority finance team who should assist at each stage of the plan. They are also best placed to look for additional short-term funding or, for example, to allow you to draw down future capital funding to ease your way through this period of change.
b) Horizontal diversification
While accepting that numbers on roll are dropping, look to ways of expanding other activities. Have discussions with your local children’s services team or extended schools coordinator. Look through the council’s strategic plans for opportunities to involve the school in future planned services. Match the facilities and resources you have with the future needs. If there are plans for, say, a neighbourhood nursery, put together a proposal showing why your school would be the ideal site for it. A school is often at the heart of the community so is well-placed to deliver community-based services.
Look at the use of your buildings and consider how this could be extended. There is a growing move towards offering ‘joined-up’ services, particularly within health, education and social services. Your local primary care trust may be looking for a base for community GPs or health clinics. Use any spare capacity within your school to embrace new initiatives. Of course, these must all be in keeping with the school’s aims and be beneficial to the stakeholders – the parents, students, governors, staff, local authority and neighbours. Look at retraining and redeploying existing staff within these new areas, so avoiding redundancy. Assess their skills and make full use of them.
c) Merger
Some local authorities have recognised that collaboration between schools can be a key mechanism for addressing the problem of falling rolls. The option to retain the individual school’s identity can still be an option here, with the schools acting as a split site establishment. Financial incentives may be available, such as medium-term protection of existing budgets or a split site allowance. In the scenario of a school with low standards, where there is little confidence that things will get better, a merger with a more successful school may boost its recovery. The declining establishment will benefit from the knowledge and leadership of its partner and this should have a positive effect on parental demand for places.
5. Timescale
Plans should be drawn up with a realistic timetable. You will need to build in adequate time for consultation and information gathering, but should act swiftly enough to respond to the falling rolls. In a situation with a gradual decline in roll there will be more time to lay down plans and to evaluate the effectiveness of your actions.
Ensure that your budget planning reflects your new vision for the future. Reserves will need to be managed tightly and any forecast deficit must be flagged up to your local authority without delay. Link the budget to your revised long-term school development plan so that priority needs are addressed. The school must maintain a high quality of delivery and standards throughout the period of change. Undertake a backward mapping exercise, starting from a fixed point in the future and working back to the present. This exercise would also be useful in the earlier stages when evaluating available options since it can highlight difficulties in achieving the desired scenario.
Conclusion
Remain positive. Work with the information you have gathered and think laterally about the options available to your school. Look beyond the present for a way to secure the school’s place in the future of the local educational environment. If your school is not viable long-term you may have the opportunity to merge with another school facing the same drop in numbers. See this as an opportunity to combine strengths.
Be supportive during the initial discussions and beyond. Some of the project team will struggle with the initial concept, wanting to come straight to a clear-cut solution as opposed to ideas and realistic hopes, the achievement of which will depend on multiple factors outside their control. The school administrator or bursar can lend an invaluable voice of reason, backed up with facts and figures.
Many assumptions about school organisation will be challenged as the school is forced to confront the changing face of society and, closer to home, the declining roll of the school. Use convergent thinking to rein in the ideas and come up with a reduced number of flexible, but achievable, options. There will be painful decisions to be made and you will need to support your school’s managers in these. However, if the school manages and comes through the process effectively, it will end up with a strong team who will be able to use the lessons of the past in order to face the challenge of the future.
Sharon Wallwork is business manager at Torquay Grammar School for Girls.