Have we made a clear link between the budget and the school development plan?
HM chief inspector's report says: "In more effective schools, spending is guided by agreed policies and linked carefully to school development priorities, sometimes through modelling of alternative budget projections. Plans are often drawn up by senior staff drawing on trends in the number of pupils on roll, staffing and other running costs. When based on reliable financial forecasts, these provide valuable guidance for decisions on longer-term developments" Are the governors making enough use of their discretion over teachers' pay?
The Audit Commission has found that even in schools with large budget surpluses, governors are often reluctant to use their discretion because it would be divisive. But giving all staff, regardless of performance, an automatic annual pay rise can push pupil-teacher ratios up. It is probably not the most efficient way to manage a limited budget, though it might seem fair.
Have we got the right staffing mix and are people spending their time appropriately?
Peter Downes, head of Hinchinbrooke School in Cambridgeshire and a regular conference speaker on financial management, says: "In order to explore this issue you need to disaggregate the costs within your school. You need to know the cost per hour of a head, of a deputy, of teachers and of other members of staff. You can then look at these and ask if people high up the pyramid are doing things which could be more effectively and more cheaply done by people lower down the pyramid."
Do we know why we have a budget surplus or deficit?
If schools find themselves with a surplus at the end of the financial year, they need to be clear whether they are saving money for a particular purpose or if they have been overcautious in their spending. Schools in deficit need to have a clear plan for eliminating it.
Do we shop around for the best deals and negotiate the lowest prices?
Schools have financial muscle and can pay less than the list price for many goods and services.
There is now scope for driving down the costs of gas, electricity, oil and water. Contracts also need to be monitored and, if they have been properly negotiated in the first place, schools should be able to demand refunds for poor performance.
Do we waste fuel and water?
By monitoring the use, as distinct from the costs, of these items, schools may find they are wasting energy, for example, by leaving the lights on for too long or failing to sectionalise the heating of their buildings.
Do we know what we are really paying for goods and services?
Schools tend to take decisions in isolation, says Stephen Clyne of EFM Ltd, a company which manages school premises. If they decide to buy new equipment, they often look at the price without considering maintenance costs. When negotiating cleaning or catering contracts they do not always cost the time of the senior member of staff who will supervise them.
Do we support our administration with the right technology?
Peter Downes points out that something as simple as a telephone system which gives outside callers direct access to the people they want to speak to can save the school receptionist's time, and so cut costs.