The issues raised in the news item and by the head of George White school in Norfolk go to the heart of issues plaguing education. The short-termism of education authorities and nearly all government departments has disastrous consequences for long-term planning and efficiency.
It also induces financial waste as schools rush to spend or commit money at the end of the financial year to prevent it being clawed back. Possibly the head of George White should have taken the time-honoured (dishonest) route of inventing binding contractual commitments for the future. An examination of the school's website shows the county council's claims about previous warnings and consultation are a little hollow. The council had accepted the school's plans as reasonable at previous consultations. It then changed its rules, or reinterpreted their criteria, without notice.
No wonder the school is angry, as their plans had previously been agreed by the council and Ofsted, but the money was clawed back.
Also missing from your story is that budgets are for a three-year period.
Normally, organisations are given a three-year budget to plan effectively.
Deficits or surpluses from one year can be dealt with or planned for in subsequent years, but if authorities change the rules mid-stream, who will trust them again?