Would you trust a company to handle your school's finances?

30th May 2008 at 01:00
YES says Dean Kelly: schools should focus on teaching
YES says Dean Kelly: schools should focus on teaching

Employing outside companies for specific functions in schools has become a topic of contention. Many in the teaching profession equate it to the privatisation of the state's role as an educator. But outsourcing, correctly executed, supports the role of the state. It frees teachers to teach, since everything else can be outsourced.

The private sector would describe this as "business process outsourcing": devolving non-core functions (in schools, anything besides teaching, pastoral care and activities involving pupils) to a partner able to deliver a more effective service, usually through economies of scale. Many of the world's largest firms take the view "What can't we outsource?" before asking "Why not?"

Managing school finances represents perhaps the greatest opportunity. It is often the responsibility of staff who do not possess the requisite business acumen or brought-in managers without the experience to improve the school's position.

Unfortunately, many heads lack external comparisons to gauge their financial situation, It is easy to see why some schools struggle to make ends meet or raise adequate funding from the community. Well regulated external specialists could transform their fiscal performance.

Sourcing new income streams, wider funding opportunities and - for any spare cash - skilled investment advice are all areas where external expertise could bring improvements. The entire financial management of many schools should be outsourced; or at least, the isolation of bursars ended.

Purchasing would also benefit from outsourcing. Many schools deploy the cheapest equipment or employ staff on the lowest salaries, even if the inefficiencies exceed immediate savings. A school procurement specialist would combine scale and efficiency to create better results. Information technology is an obvious area. Too often, schools use in-house teams that struggle to keep pace with latest developments.

Optimising the use of school facilities could also be outsourced. Sports and music equipment, halls and playing fields can often be made available to raise funds and increase community spirit. Facilities management specialists could maximise revenues while creating a hub for local activities.

Then there is staffing. This is a minefield of human resources and compliance issues. Building strong relationships with recruitment specialists should allow for an effective process, saving schools a great deal of time and money.

Much of the antipathy towards outsourcing is ideological. But teaching unions have campaigned to get teachers back into classrooms and away from administration. And processes such as payroll and contract management are already outsourced to the local authority.

So, schools should take control and outsource to organisations able to deal with complex administrative financial issues and managed under strict service-level agreements with predefined targets. This would free teaching staff to do what they do best, namely teach.

Dean Kelly is chief executive of Synarbor, a recruitment agency for the education and social work sectors

NO says Ray Tarleton: a company would not have the same vision

spring brings a new financial year and I can't wait to get my hands on the budget. Not only do we have next year's spending to plan, but there is also a reasonable carry forward to allocate to priority projects, such as new laptops, lathes and a whiteboard or two. It's just like Christmas.

Money drives all initiatives. We have been carrying devolved capital for a couple of years to pay for some building projects that will cost nearly pound;750,000. We will have new photography, media and dining facilities in the autumn if all goes to plan. It is a big bang for our buck.

And we have a dozen or more administrative changes to make where staff are changing roles, altering working hours or filling new posts.

Each of these issues involves complex decisions. To make it all happen, we need to have a finance team both physically available and mentally turned on to what we are trying to achieve. They are 10 seconds' walk from my office. One of the four is always available, unless they are on bursar training. I'm in and out of finance every day.

Financial and strategic decisions are rarely separate. They are also sometimes personal to the school, concerned with staff pay and grades. While I have no problem with payroll running the salary cheques each month or the bank holding our accounts, I want to be in control of the decisions. These outsourcing companies do what we tell them because their remit is limited. I would never let my bank manager make decisions for me.

My finance team is totally focused on our school. They are involved in everything we do; they are a constant source of advice, a check against error, and part of the human face of the school. But they can also be scarier than any auditor, and they have a direct line to the chair of governors, who drops in each week. Dare anyone send a non-order invoice? Try using your credit card to buy something at the last minute and see the reaction.

Achieving value for money? It's in their DNA. My head of religious studies has just heard that finance can negotiate a 30 per cent reduction on a large text-book order, saving pound;700. As for rail deals, they could compete with any travel agent.

Value added isn't just about exam results. This is our school, our pupils, our money and it matters to us all.

We run our own catering and cleaning operations and have an expert information technology team. All the staff are our employees with a commitment to our values and aspirations. So, for example, our ICT technicians know how respond to site-specific problems. Imagine if they were outsourced: the frustration of having to ring a helpdesk and be put on hold.

The finance team cost 1.14 per cent of my budget. To provide the same level of service, a private company would have to lease its staff to us. Could they at that cost?

I can see them eyeing the carry-forward and funding for buildings. We might find our spring Christmas stockings would be empty.

Ray Tarleton is principal of South Dartmoor Community College in Ashburton, Devon, which has 1,650 pupils, 250 employees (120 teachers), and an annual budget of pound;8 million.

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