Watchdog seeks tighter controls over budgets

22nd May 2009 at 01:00
Council admits it failed to check bonuses school

Audit Commission calls for local authorities to get tough

Schools will have much less freedom to manage their own budgets, with tougher controls from Ofsted and local councils, if a public spending watchdog gets its way.

The Audit Commission is concerned that many headteachers lack the expertise to run large and complex budgets. It wants them to undergo greater supervision.

The commission says local councils have "distanced themselves" from monitoring and challenging school budgets and wants them to conduct more financial audits.

Its call came as Brent Council, which last week suspended the head, deputy and bursar of Copland Community School over allegations of serious financial mismanagement, admitted to The TES that it had not audited the secondary.

The Audit Commission has been told that the senior management team at the north-west London school took Pounds 1 million in bonuses over the past seven years.

In a statement to The TES, the local authority said: "Brent Council does not audit Copland School. The school appoints its own independent auditors directly."

The Department for Children, Schools and Families said councils had a responsibility to ensure public money was spent properly and that "most" sent auditors to schools, including foundation schools like Copland, "every year or two".

The Audit Commission's plans could amount to the first major reversal in more than two decades of increasing school autonomy, just as heads prepare for the fall-out from the biggest public spending squeeze in a generation.

The commission argues that schools should face the same checks and sanctions over finances as they do over academic standards. The shrinking public purse will only bolster its case.

In evidence to the Commons schools select committee, the watchdog says: "Around pound;37.5 billion per annum is spent in schools. It is important to demonstrate that these sums are well spent. School expenditure represents the largest single element of local government expenditure, but attracts the least detailed financial scrutiny."

The Audit Commission will apply more pressure next month in a report expected to call for Ofsted to look at results achieved by schools in relation to money spent.

Growing school autonomy and delegation of funding means local councils have "very limited up-to-date knowledge of the state of schools' finances", the watchdog says. It notes that schools with budget deficits have remained at about 2,000 for the past eight years.

That figure would have been much lower if school finance had the same monitoring, challenge and support as teaching and learning, according to the commission.

But John Dunford, general secretary of the Association of School and College Leaders, said: "We already have enough accountability. If the current accountability is not doing its job, then it should be improved, not increased."

The watchdog wants all chairs of school governors and governing body finance committees to receive mandatory training in financial management.

Phil Revell, chief executive of the National Governors' Association, said this would need a change in the law and could paralyse governing bodies if volunteer governors were unavailable for training.

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