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Double-edged sword tied to a pot of gold

Formula Capital gives schools the freedom to get on with plans for development, but it means heads must take more responsibility for the upkeep of their buildings. Stephen Hoare reports.

From next month, all schools except city technology colleges will receive a minimum of an extra pound;4,000 a year to improve their buildings. The Department for Education and Employment, under its Formula Capital plan, is giving nearly pound;190 million a year directly to schools, instead of local authorities. The money can only be spent on capital projects, such as major roof repairs, rewiring, boiler replacement or the creation of specialist teaching spaces.

The grant is on top of any money schools already receive under the local management formula for repairs and maintenance and any Standards Fund grants for upgrading security. It is also additional to the New Deal for Schools money that was available to help bring schools up to a national standard and in particular for primaries to abolish antiquated outdoor toilets.

The pound;4,000 lump sum will be topped up with a per pupil allocation of pound;10 for primaries, pound;15 for secondaries and pound;30 for special needs pupils in both phases. This means a 250-pupil primary school will get at least another pound;6,500 and a 1,000-pupil secondary could receive more than pound;19,000 a year from now on.

Schools can save the money over three years for a major project. Or, if they are part of an education action zone, several schools can pool their money in a single scheme.

But local authorities will keep their influence on schools' capital spending through another pot of money, Seed Challenge Capital, which will be distributed to schools looking to raise money for projects that will be match funded by the private sector. With pound;30 million on offer, each authority can expect to receive pound;200,000 on average.

Alan Docksey, head of finance for Surrey, believes Formula Capital is a result of the Government listening to the complaints of headteachers of former grant-maintained schools who had enjoyed control of their building budgets. "GM schools had a similar allocation. It was an area of responsibility that they lost."

If former GM school heads are now happy at regaining control of their budget, many others still regard building work as a heavy responsibility - as much for health and safety and contractual issues as for budgeting. They will miss the old division of responsibility for maintenance, under which schools looked after the inside of the building - the furniture and decorating - while the local authority had the landlord's responsibility for the structure and services such as heating and ventilation.

Peter Lidiard, Hampshire's schools property manager, argues that schools need the support of their local authority. "The money you need to spend on buildings has very little to do with pupil numbers One school might need a lot of expensive external redecorating because of its timber work, whereas a brick building will need hardly any," he says. "Under Fair Funding all schools gave us their money back so we could allocate it."

But central allocation does not always work to a school's advantage, particularly if its works come low on the authority's priority list. Formula Capital gives schools a new freedom: their development plans are no longer dependent on approval by the local authority. If they have the money, schools can get on with their project.

Andy Hayman, head of Forest Lodge primary in Leicester, which has 400 pupils, reckons with his pound;8,000 a year Formula Capital grant he could tackle work that has been put on hold by the over-stretched city council. "We're in a 50-year-old building," he says. "The inside toilets need a complete refurbishment and there's damp in one corridor. That means repointing and damp-proofing an exterior wall."

The change in funding is altering the role of local authorities to one of advice and support. Some are doing this is by involving schools in drawing up asset management plans to decide spending priorities and waiting times for building works so that they can budget for them.

The Government is expecting authorities to keep a check on what schools are spending and to advise on which schemes qualify for Formula Capital funds and which must be paid for out of revenue for running repairs. This is a sensitive issue because schools are expected to ring fence their capital funding. Although they can add repairs money to capital funding to create a bigger pot, they cannot do the reverse.

At Surrey, Mr Docksey's priority is writing guidelines for schools to help them differentiate projects. He believes that local authorities also need to get the message across to schools that they are no longer the Big Brother that will step in to sort out all repairs. He says: "Schools have the perception this is extra money. We have difficulty in explaining to them that they've got the money we would have had. A lot of the building work is now their responsibility."


Under the Formula Capital plan, a primary school with 400 pupils will receive pound;8,000 next year. A 1,000 pupil secondary school will get pound;19,000. Saved over three years, the primary will have pound;24,000 and the secondary pound;57,000, plus any accumulated interest. What could their money buy?



CCTV security New boiler

Rewiring Major roof repairs

Improvements to toilets Window replacement

Playground furniture Landscaping


Major roof repairs Classroom conversion

Upgrading the boiler

Lighting and fencing


DFEE stand K11

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