Ruth Bradbury outlines the things that all senior school finance managers need to know in order to contribute effectively to the running of their school

The role of the school business/ finance manager is a hugely complex and responsible one but – until recently at least – there has been little acknowledgement of the demands of the post, or any framework or guidance to help newly or recently appointed individuals. Even with the higher profile of the role brought about by workforce re-modelling and the introduction of qualifications such as the Certificate in School Business Management, there is often little support for post holders on the ground in what can be at times a rather isolated job.

Furthermore, the culture of a school community is so strong, and its members can become so immersed in it, that established staff can very often assume that everybody they come across is fully appraised of the key issues and jargon of the education world.

This can pose problems for almost anyone (I know teachers who have sat through entire meetings too embarrassed to ask the meaning of a particular acronym), but for business managers – especially those who have been recruited from outside of the education sector – it can significantly impede their progress, and thus their effectiveness.

In this article, I have attempted to cast my mind back to the first year that I spent in my current post, and to come up with a summary of all of the things that I didn’t fully grasp which – had I understood them – would have made things so much easier for me. Whilst some of this is directed towards people who are relatively new in post, I am sure that there are some sections which may help clarify things even for long-serving staff. There are also a number of tips and suggestions included within the text to ensure that newly gained understanding can inform good practice and can support teaching and learning.

Understand school structure and roles

If you have ever tried to draw up a structure diagram for a large secondary school, you will realize how complex things can become. Most teaching staff have at least two roles (subject teacher and form tutor), and will report to different managers in those roles (eg head of department for subject teaching, head of year for form tutor responsibilities). Individuals may also hold teaching and learning responsibility (TLR) points for separate initiatives or projects (eg gifted and talented or enterprise learning coordination) and may report directly to the headteacher or leadership team in those roles. To make things even more confusing, the headteacher and other school leaders will also be teachers in particular departments, and will therefore report to the heads of those departments in their teaching roles!

Things aren’t necessarily simpler when it comes to support staff either. Whilst most schools have an outwardly straightforward line management structure for support staff, often headed by the business manager, the recent growth in student-focused support staff roles (such as pastoral managers or cover supervisors) means that a lot of day-to-day direction of those roles may now come from non-teachers.

If you want to understand how things work in a school, then the key is very often having a grasp of who is in charge of what. At the very least, then, it is important to understand:

  • leadership team responsibilities
  • the academic structure – heads of faculty/department and teachers in those departments
  • the pastoral structure – heads of year, any pastoral support staff and form tutors
  • additional responsibilities (TLRs) – who has responsibility for what
  • the support staff structure – day-to-day line management and informal reporting lines.

It is also worth obtaining a broad understanding of the nature of the roles. Further ideas for this are contained within the section on ‘core business’ below.

Organizational structure is not the only thing in schools that is complicated. Teachers’ pay is also notoriously difficult to understand, especially for people who may be working in the education sector for the first time. As with many things in the education world, people will assume that you have full knowledge of the intricacies of the pay structure, and it can be very difficult to admit that you don’t. In financial management terms, however, an understanding is of course absolutely vital if you are to budget and monitor expenditure successfully. There is not enough room in this article to outline the pay structure in detail. However, a summary of the key knowledge you will need is outlined below:

General pay structure knowledge

  • An understanding of the purposes of the three main pay spines (main scale, upper scale and leadership spine), and current salary rates.
  • Knowledge of the threshold process and eligibility criteria.
  • An understanding of the role of teaching and learning responsibility points (TLRs) and the upper and lower limits of the ranges.

Specific knowledge in relation to your school

  • Which members of staff are on which point of the pay spine, and when their next increment is due (automatically every September for M1-M6; every two years by application on the upper pay spine).
  • Which members of staff are eligible to apply to go through the threshold (ie. are currently on M6) and when they would be transferred to the upper pay spine if successful (no earlier than one year after reaching M6).
  • Which members of staff are eligible for upper pay spine progression, and how this is assessed and implemented in your school.
  • Which members of staff hold TLR points.
  • The specific TLR ranges allocated within your school.
  • Which members of staff are subject to salary safeguarding as a result of the transition from management allowances to TLRs.

Unfortunately, although the above summary describes perfectly the current situation on teachers’ pay, it is one of the least stable aspects of school finance owing to frequent government changes. Further changes are earmarked in 2007 to performance management, which are likely to have an important bearing on future arrangements.

Understand school funding

Budget allocations to individual schools are calculated using a number of different methodologies and formulae. It is important that business/finance managers have a basic understanding of this process – not only so that they can check that allocations are correct, but also so that they are aware of the implications for funding on any significant changes in the school set-up (eg a reduction in student numbers, an increase in free school meal applications, etc.). Full details should be obtainable from your local authority, but a brief overview of the most common funding sources/ mechanisms is provided below:

Age-weighted pupil units (AWPUs)

The bulk of your main Section 52 budget allocation, this is determined by the number of students your school has in each age group. These numbers are multiplied by authority-wide standard rates (pupil units) to come up with an overall allocation for each school. One important thing to note is that AWPU funding is allocated in advance for a full financial year (April to March) and will therefore be based on estimated student numbers in Year 7 (Year 1 in primary) in September. When actual student numbers are known, your allocation will be adjusted to reflect this. Thus significantly higher or lower numbers than expected in September will have an in-year financial impact, and this should be taken into account in your out-turn estimates as soon as actual student figures are known in September.

Other formula allocations (often referred to as ‘non-AWPU’ allocations)

There are, of course, aspects of school expenses which do not depend solely on student numbers. Individual local authorities are entitled to devise their own formulae for these based on what they consider to be the most rational or logical data. However, the formula that they use must be applied consistently across all schools. Examples of this type of allocation may include premises costs (often a fixed amount per square meter), or SEN funding (often based on number of statemented students and/or numbers of students with particular categories of learning difficulty). It is worth familiarizing yourself with and checking the formulae used by your local authority – firstly to make sure that the base data used is correct, but also so that you will be able to understand the funding implications for any significant changes in that base data – eg an increase in school area due to the building of a new extension, or a reduction of students qualifying for free school meals.

Sixth form funding

Allocated by the Learning and Skills Council via local authorities, the majority of sixth form funding is based on a ‘tariff’ system for individual courses, based upon guided learning hours required and resource requirements. Schools are funded on the basis of individual courses taken rather than simple student numbers. Funding for each financial year is based on the students and courses in place in the previous September – it is therefore important to understand that a drop in sixth-form numbers this September will directly affect the income you receive in 2007-08, and that this needs to be taken into account in financial planning for the future.

Standards Fund

Up until this year, the Standards Fund was made up of a substantial number of separate grants designed to be directed by schools to particular areas. In 2006-07, however, many of these grants have been rationalized into one grant, known as the School Development Grant (SDG), which is allocated by local authorities on a formula basis. The SDG can be spent on any purpose to improve the standard of teaching, learning and achievement in schools, although the guidance states that schools should have regard to the former purposes of the grants that have been incorporated.

Whilst the SDG now incorporates the majority of former Standards Fund grants, there are a number of small grants which are still allocated separately. Details of these, together with further information on the Standards Fund, can be found at the web address provided at the end of this article.

School Standards Grant

The School Standards Grant is an annual allocation to schools paid on a flat-rate plus formula basis: for a secondary school in 2006-07, for example, the rate is £11,000 plus £98 per student. This grant can be used for any purpose of the school, including community and extended schools operations – activities which cannot currently be funded from the main Section 52 budget. This is particularly relevant in the light of government plans for all schools to develop extended services, specifically childcare provision.

Specific Formula Grant

This is an allocation made to schools to partly cover the additional costs of the introduction of the teachers’ pay structure, including threshold and performance pay. Previously known as the Threshold Grant, it is based on the number of post-threshold teachers in post at a school.

Understand core business

The key purpose of a school is to educate and prepare young people for their futures, and the key purpose of a school business or finance manager is, therefore, to ensure that resources are allocated to ensure that this is done in the most effective way possible. In order to do this, it is essential that you have an overview and understanding of educational issues, of school strategic plans, and of the day-to-day practicalities of teaching and learning in their school. Part of this understanding will come naturally from listening – and contributing – to discussions at leadership team meetings (so if you’re not a member of your school’s leadership team, this can be one of the strong points of your case to become one), but there are other things that it is worth doing to enhance and develop your understanding further. These can include:

Meeting with heads of department to get an overview of their subject areas, including the identification of particular issues where you may be able to contribute. These could range from straightforward infrastructure requirements such the installation of additional electrical sockets to make it easier for students to use laptops in lessons, to discussions about introduction of classroom assistants or the resourcing of a new subject at A-level. In addition to the practical outcomes of meetings such as these, you will find that they will help you to develop positive working relationships with departments, which can only benefit the school as a whole.

Observing lessons to gain an insight into the practicalities of teaching and learning. It is likely that what takes place in a classroom will have changed quite dramatically since you were at school (it certainly has since I was), and watching a few lessons will give you the opportunity to be updated on classroom practice and – at the same time – to get an appreciation of exactly what is involved in engaging a group of 30 young people for an hour or more. Again, too, you will get the opportunity to think about the practicalities of classroom life, and possibly come up with ideas to make the teacher’s role easier and more effective. Ask the advice of senior colleagues as to which staff would be best to observe, and make sure that you seek the permission of those staff rather than just turning up in their classrooms. In the majority of cases they will be more than pleased to show you what they can do!

Gaining awareness of the National Curriculum – whilst I wouldn’t necessarily recommend that you read the National Curriculum from cover to cover, it would seem to me only logical that any senior member of staff in an organization should have at least a basic knowledge of its main content and focus. As well as helping you to understand some more aspects of ‘education-speak’, a grasp of the school’s statutory educational responsibilities will undoubtedly help you to obtain an informed outlook and a whole-school approach, both of which are fundamental for effective business management.

Knowing (and contributing to) school improvement priorities – school improvement planning, focusing on the quality of teaching and learning and the raising of attainment, is a fundamental aspect of the role of the headteacher and leadership team. In recent years there has been a drive to introduce rigorous self-evaluation in schools, and to reinforce the links between this and the improvement planning process. A key document relating to this is the school Self-Evaluation Form (SEF). This form is one of the cornerstones of the new inspection system, and it requires schools to assess their own performance and identify key priorities for development in the following areas:

  • views of learners, parents/carers and other stakeholders
  • achievement and standards
  • personal development and wellbeing
  • quality of provision
  • leadership and management.

The SEF is completed by the headteacher via the Ofsted website, and is available for inspectors to view at any time. In an inspection, it will serve as a basis for discussions with the inspection team, and will enable them to focus on the strengths and weaknesses which have been identified.

In addition to its inspection purposes, the SEF is also a valuable tool for continuing school improvement. Its status as a ‘live’ document which is regularly updated means that it is the most current analysis of strengths, weaknesses and development priorities and it thus has a key role to play in informing the school improvement plan (SIP). Ideally, the SIP should focus on identifying actions to address the priorities identified in the SEF, together with any additional development requirements which have not been highlighted in the self-evaluation process. Certainly, there should be clear links between the SEF and the SIP, as they are both important strategic documents which must complement and reinforce one another if school improvement is to be a robust and coherent process.

As a key leader in the school, it is important that the business manager is aware of the priorities identified in the SEF and the SIP, and of how he or she can contribute to addressing them. Ways in which this can be achieved will include:

  • costing and resourcing proposed developments and ensuring their inclusion in the annual spending plan
  • ensuring staff and infrastructure support for improvement initiatives (eg data entry staffing for achievement monitoring, network access and technician support for integration of ICT)
  • publicizing and promoting school improvement priorities to staff within their area of responsibility.

In addition to these practical contributions, an understanding of the broad context of school improvement will enable the business manager to gain more of a feel for the values and direction of the school, and thus become a more effective whole-school leader.

Understand national context and initiatives

Developments and improvements in schools are not only informed by internal aspects such as the Self-Evaluation Form, but also by national policies and agendas. It is therefore crucial that you have an overview of any significant national strategies which affect your school and have an impact on provision. Some ways of ensuring that you stay up to date with developments can include:

  • reading the newspapers, especially the TES
  • regularly checking relevant websites, including the DfES, Teachernet, the Specialist Schools Trust, Ofsted and NCSL (see below for addresses)
  • subscribing to a document summary service such as that provided by the University of Bristol School of Education (www.bristol.ac.uk/education/enterprise/docsum). This will provide you with easily digestible monthly summaries of important documents from the government and other sources.

Ruth Bradbury is assistant headteacher (resources) at Westhoughton High School in Bolton

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