Private firms cost councils

7th January 2005 at 00:00
Companies in charge of local education services are spending the most on administration. Graeme Paton reports

Private companies running local education services are spending on average a third more on administration than councils do, figures obtained by a headteachers' association have found.

The National Association of Head Teachers analysis of budgets for this financial year, shows the London borough of Southwark, where schools are in the hands of Cambridge Education Associates, spends pound;133 per pupil on administration, the highest in the country and more than twice the London borough average. The next costliest council is Islington, also involved in a deal with CEA, where costs are pound;99 per pupil.

In all, administration spending at seven out of the eight councils with links to private companies is above the national average. The only council to buck the trend is Bradford, which is involved in a partnership with Serco. However, the authority was criticised this week after it was revealed that it intends to transfer pound;1 million of schools' money to Serco's contract for 20056. Bradford council is proposing to move the cash from its central schools budget to the budget of the LEA, run by Education Bradford, a subsidiary of Serco.

Mark Carriline, Bradford council's assistant chief executive, insisted headteachers were not being short-changed. "We have come a long way in the last few years, but there is still a big job to be done on school improvement and behaviour issues," he said.

David Hart, general secretary of the NAHT, said: "It seems outrageous that central administration costs are so much higher where local authorities have outsourced education."

On average, local education authorities intend to spend pound;57 per pupil on administration this financial year. In London boroughs the average jumps to pound;63. But an analysis of the figures carried out for the NAHT shows Southwark and Islington easily top the admin costs league table.

Swindon, which is involved in a three-year partnership with the Tribal Group, exceeds the national average by almost 50 per cent, with pound;80 per pupil spent on administration. Hackney, Wal-tham Forest, Leeds and Walsall councils, which are all involved in deals with the private sector, also spend more than the rest of England. A ninth LEA, Haringey, which ended its contract with Capita on August 31 last year, will spend pound;83 per pupil this year. But high costs are not restricted to the private sector. Portsmouth, Nottingham and London's Merton all spend more than pound;90 per pupil.

Wendy Sagar, head of education finance at Southwark, said the authority's spending appeared so high because extra costs had listed as "administration" in its contract with CEA when they should have been accounted for elsewhere in the budget. CEA was unavailable for comment.

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