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Budget areas to be redrawn for LEAs

Local management of schools. The Government believes that it is now time for a further push to extend local management, with a new national LMS framework.

It therefore intends to redefine the Potential Schools Budget (PSB), and to raise to 95 per cent the proportion which LEAs must delegate to schools.

The Government will consider what guidance is needed, particularly to help governing bodies make best use of the power which LMS gives them.

In deciding future Grants for Educational Support and Training programmes, the Government will look at the level of funding needed for governor support in the light of the proposals in this White Paper, and whether those funds should be separately identified.

There remains outside the PSB a block of school-related spending, covering building projects, transport, specific grants and other items. The Government will monitor levels of expenditure on all items managed centrally by LEAs. It does not expect these to rise at the expense of schools' delegated budgets.

The Government proposes to leave other items currently outside the PSB where they are. The main ones are: * Capital spending; * LEA contributions to specific grants; * The educational psychology service and special educational needs administration costs; nThe education welfare service; * Home to school transport; * Pupil support; The Government considers that, except for spending on pupils with SEN statements, all items within the Potential Schools Budget should be delegated to schools, either in whole or in large part. These include: Educational support services,premises services, staff-related services, advisory and inspection services, and management and administration services.

The Government proposes to redefine the Potential Schools Budget to take out spending on pupils with SEN statements in mainstream schools, and to bring in spending on school meals, milk and LEA initiatives.

The Government wishes to apply a challenging but realistic minimum requirement for delegation, and proposes to set this at 95 per cent of the redefined PSB, compared with the current requirement of 85 per cent (90 in Wales).

This would bring an additional Pounds 1.3 billion of school spending within the formal delegation requirement in England, representing some Pounds 200 per pupil; and an additional Pounds 600 million, or Pounds 90 per pupil, compared with what LEAs now delegate.

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