...and be sure it's well spent
In his latest annual report the Chief Inspector of Schools says: "Financial control is a strength and is good in the large majority of schools. Financial management is more variable...The evaluation of cost effectiveness remains a weakness in one-third of schools."
When working with tight budgets governing bodies need to cost existing provision in order to make the best use of available resources. It is also particularly important for them to cost development proposals. They can then measure the educational benefits to be gained from any increased expenditure.
Costing developments should be part of a governing body's drive to achieve better value for money. The requirement to make an evaluation of the value for money achieved by a school is now a key aspect of the Office for Standards in Education inspection framework. It is literally the bottom line in the OFSTED summary report for parents.
Value for money has three elements: economy, efficiency and effectiveness. Costing is integral to all three. Economy relates to expenditure. It is minimising the cost while maintaining quality or the careful use of resources and the need to keep costs down.
Efficiency is achieving the maximum output from given resources. An efficient school makes the best possible use of all available resources to achieve high educational outcomes at thelowest cost. Effectiveness is the extent to which the school's agreed aims and objectives are achieved. An effective school achieves high educational outcomes for its pupils.
Simple cost-benefit analysis can be extremely useful for governors. Through costing what the school provides at present and proposed developments governors can ask: can greater effectiveness be achieved at similar cost? Or could similar effectiveness be achieved at lower cost?
Calculating costs can appear a complex task but senior school staff can, after making a few simple calculations, give governing bodies accurate information. Curricular costs are based around the number of teachers a school employs, the amount they teach and the size of their classes.
Governors as a matter of routine should be given the following curricular information:
* The pupil-teacher ratio in the school
* The average class size for each year group
* The average teacher contact time. (The time teachers spend teaching as opposed to undertaking other duties.)
All this then needs to be costed because the cost of changes to this provision can be remarkably high. In my own school, which has just over 900 pupils, the cost of reducing class size by one pupil in Years 7 to 11 would be Pounds 51,584. A reduction in the teacher contact time by one per cent from the present 76.8 per cent would cost Pounds 19,022. Costs such as these need to be understood before any changes are made.
When making a decision about a curricular development it would be helpful for governing bodies to know: the average teaching staff salary; the average cost of teaching one period in the timetable cycle and the sum given to the school to educate each additional pupil (the age-weighted pupil unit).
The cost of teaching the curriculum to each year group can then be calculated. These costs can be set against the income derived from that year group. In many schools the staffing demands of some year groups, especially the sixth form, are therefore subsidised by other classes. This situation may be acceptable to a governing body but it shouldat least be aware of inequalities in expenditure.
When the curriculum is changed costs need tobe analysed. Resourcing the national curriculum in primary schools, for example, had massive cost implications.
Changes to the curriculum, too, can result in additional staffing costs. The recent requirement, for example, to teach design technology to all pupils in key stage 4 has brought additional staffing costs to many secondary schools because the subject is taught in smaller classes and therefore requires more teachers. In my own school the same group of pupils are taught English by seven teachers and design and technology by eight.
Costing is particularly important when making changes to the sixth form curriculum. Very often new subjects are introduced into the sixth form which do not bring in income by attracting additional students to the school and merely dilute numbers - and therefore the cost efficiency - in other subjects. Detailed cost analysis is needed when making a decision about curricular development (see checklist).
Governing bodies do not want to become so cost conscious that they are caricatured as people who know the price of everything and the value of nothing. Penny-pinching can soon reduce school effectiveness. But costing is important. By costing existing provision and proposed developments governing bodies will spend public money more wisely. Good value for money is ultimately for the benefit of all pupils.
* Clearly define the development; those led by enthusiasts tend to grow in cost.
* Assess start-up costs; a new A-level in photography, for example, may initially cost more than one in psychology.
* Assess costs over an extended period; which are likely to change?
* Spot the hidden costs; staffing will be the main one but there may also be the learning resources, development time, in-service training, learning support staff, reprographics, maintenance, secretarial and other administrative support, examination fees, heating, lighting, etc.
* Include other less tangible costs. What will the effect of the development be upon other members of the school staff and the school's relationship with neighbouring schools?
* Assess any income to be derived from the project; will it attract additional students or attract any sponsorship or grant?
* Assess any cost reductions to be gained from the development.
* Having taken costs into account itemise the benefits to be gained. Assess these in the light of the school's priorities.
* Come to a conclusion. Is the development cost-effective; Does it help to raise standards?
Martin Titchmarsh is headteacher of the Nobel School, Stevenage