Half of trusts ‘against central pooling’ of school budgets

A small poll suggests MAT leaders value centralised funding but are wary of deterring potential new trust schools

A small poll suggests MAT leaders value centralised funding but are wary of deterring potential new trust schools

Half of multi-academy trusts in a recent poll said they do not want central teams to manage all funding through “GAG pooling” – despite many seeing the benefits.

The survey found 50 per cent of trust leaders were wary of centralising general annual grant funding “due to the negative impact this could have on schools wanting to join their trust”.

The poll of 83 chief executives and chief operating and finance officers was carried out as part of the MAT Growth Survey 2022, due to be published next month.

Most academy trusts top-slice a percentage of individual schools’ GAG funding for everyday spending to fund central operations.

But recent years have seen a sharp rise in trusts handling income centrally, and allocating it to schools in proportion to their needs through their own tailored formulas. The Kreston Academies Benchmark Report earlier this year found 14 per cent using GAG pooling, up from 0.8 per cent in 2017.

The latest poll, by MAT finance software provider IMP Software, saw 94 per cent of chief executives and chief finance and operating officers report that centralising more of their funding or operations could make them more effective organisations.

Among trusts that already use GAG pooling, almost three-quarters said their levels of centralisation were either a positive or neutral factor for those looking to join.

But other leaders’ wariness is likely to reflect some schools’ fears over what the Kreston report called “a perception that in the short term some schools will gain and others will lose out”.

In a schools bill debate earlier this year, one peer called for more transparency over MATs’ pooling formulas, noting efforts to equalise schools’ funding via the national funding formula.

Others in the sector want clearer guidance to help trusts and allay concerns, with limited information in the academy trust handbook. But another peer praised its flexibility in allowing the “redistribution of wealth”.

Source Kreston Academies Benchmark Report

MAT chiefs may be especially cautious given how many wish to expand trusts, with the government’s white paper this year stating trusts should aim to have at least 10 schools or 7,500 pupils.

Among those polled, half said they were targeting growth by one or two schools over the next 18 months, a third reported seeking between three and five new schools, and 8.5 per cent were aiming for five or more.

More than 90 per cent were “confident” about meeting the growth target, with around two-thirds currently managing less than 10 schools.

Will Jordan, co-founder of IMP Software, said many trusts, particuilarly newer ones, did not yet have “the organisational strategy or underpinning systems in place” to meet the government’s aims.

He also warned the sector was being “told to grow amid a budget crisis and without a clear picture of how they can evaluate and plan for it”.

MAT finance chiefs face “ever-changing goalposts…and an increasingly volatile budget position, including substantial teacher and support staff pay awards, energy price increases and no additional funding”.

He called for “much greater recognition for the job MAT finance professionals do”, with nominations open online for the MAT Finance Awards, which IMP Software supports, from now until 31 December.

Categories include MAT finance leader, team, champion, rising star and project of the year. the judging panel includes Confederation of School Trusts CEO Leora Cruddas, Institute of School Business Leadership CEO Stephen Morales, and Bishop Fleming audit partner Pam Tuckett. Winners will be announced in early January.

Schools Week is media partner for the 2022 MAT Finance Awards

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