Schools won’t be paying back savings

By Elgan Hearn, Local Democracy Reporter

Assurances have been given that schools in Powys with money in the bank will not be forced to hand it back.

A financial report on Powys County Council’s (PCC) schools will go in front of the cabinet on June 18 and was looked at by the Learning and Skills Scrutiny Committee.

While 28 schools are facing budget deficits, 65 are in the black as many of those have saved money for a rainy day.

A mechanism called “claw-back” could be triggered if a primary school has more than £50,000 surplus. For secondary schools the figure is £100,000.

A PCC list has been drawn up of schools that could be subject to this. And a list for those that already meet the criteria.

Guilsfield councillor, David Jones, said: “Looking at the schools that are being lined up for claw-back. They tend to be primary schools and have taken some hard decisions in the last few years.

“They have reduced staffing, re-graded staff. Some are predicting they will go into deficit in the next 18 months or so.”

Cllr Jones believed if they were subject to claw-back the schools would go into the red earlier.

Head of finance, Jane Thomas, said: “Claw-back regulation is something we have to consider as it’s part of our statutory regulations. That’s why it’s in the report paper and the financial scheme for schools sets out the action we would take.”

Ms Thomas went on to say that late allocations of funding for school budgets as well as uncertainty about teachers’ pay had caused the extra money to be held at some schools.

Ms Thomas added: “I may be wrong, but I don’t expect that we will be clawing back from any school, particularly those forecasting a deficit position, because when they explain how they are going to use that it will be quite clear that it’s about dealing with that deficit.

“Some schools know they have issues coming along that they will need that for. It’s not a tool to hit schools with, it’s a requirement and we have never taken claw-back from a school.”

Portfolio holder for finance, Cllr Aled Davies, added: “The important word in the report is: potential. You have to go through the process because of legislation, we never have initiated claw-back and undoubtedly schools will have plans of how they will use their surplus.”