Leading efficient and effective schools

Primary

1

Purpose of the day

To develop governors’:

• ability to meet their responsibilities for efficiency and value for money (Governors Handbook, Section 7.3)

• knowledge and understanding of the key findings and recommendations in the ‘Review of efficiency in the schools system’ 2013

• awareness of the ‘efficiency review tool’ and how to use it in their schools

Programme

• Setting the scene• Managing the business of schools• Staffing matters• Effective procurement• Protecting the public purse• Establishing an efficiency culture• Moving to action

What do we know about our most efficient schools?Review of efficiency in the schools system, 2013

What do we understand by efficiency?

‘There was a strong and consistent response that being efficient meant getting the most out of the money available to give children the best quality of education.’

(Review of efficiency, p34)

Similar schools…..similar spending …. different levels of attainment

Schoolswith similar average total expenditure per pupil (range £4,000 -£4,800 per pupil)

Similar schools…..similar spending …. different levels of attainment

Schoolswith similar average total expenditure per pupil (range £4,000 -£4,800 per pupil)

Review of efficiency in the schools system: key findings

The most efficient schools:

1. Deploy the workforce effectively, with a focus on developing high quality teachers

2. Make use of evidence to determine the right mix of teaching and education support staff

3. Employ or have access to a skilled school business manager who takes on a leadership role

4. Make good use of financial benchmarking information, to inform the school’s own spending decisions

5. Make use of school clusters, sharing expertise, experience and data, as well as accessing economies of scale when making shared purchases

6. Manage down back office costs and running costs

7. Have in place a strong governing body and leadership team that challenges the school’s spending

Responsibilities for efficiency strategies?

Solid foundations

How are you managing the business of your school?

Do you have access to appropriate specialist expertise?

Benefits of employing an SBM

Reduction in SLT workload – focus more time on teaching and learning

Financial gains (PwC study: over 7 year period SBMs generated £306m in savings or income)

– Implementing more efficient staffing structures and increasing the use of shared staffing;

– Better management and negotiation of contracts; – Taking advantage of bulk purchasing opportunities; and – Improved project management, particularly important in

reducing capital costs

What can SBMs do?

Member of SLT

Leading business in schools

Table discussion–Who is responsible for the business functions of your school?

–Does your school employ an SBM?

–How are they deployed? Is there scope for enhancing their role?

–Could you help other schools in your area?

–What are the challenges to appointing an SBM?

–How might you overcome them?

–What enablers are in place to help you?

Staffing matters

This is where most of your budget is spent.

Are you spending enough?

Are you spending wisely?

Review of efficiency in the schools system – key finding

We have found that the most efficient schools maximise their investment in teaching staff, activities and learning resources that make the greatest difference to pupil outcomes – and they are creative in minimising all other running costs. (DfE, 2013, p 6)

Teacher staffing matters

‘Teacher quality is the single most important feature of successful education systems and schools spend, on average, over half of their total budget on teaching staff.

This is by far the largest amount of money spent on a single area. According to research that measured teaching effectiveness across England, having a good teacher rather than an average teacher for two years is estimated to be worth three grades for pupils taking 9 GCSEs.’

(Review of efficiency, 2013, p9)

Spending on teachers

School type: Low FSM, Large, Urban, Non-selective, Medium Prior Attainment

School workforce spending – key considerations Teaching assistants:

’It is clear that not all of them are being utilised to best effect in the classroom. Schools may wish to review the deployment of their teaching assistants. In particular, where teaching assistants offer more general support, schools may want to consider their impact and how it might be improved, for example through specific training’

Teachers:

‘Schools may want to weigh up their overall spending on support staff compared with teaching staff, in light of the available evidence about the balance in high performing schools.’

(Review of efficiency, p 14)

Teachers’ Pay Reform

Changes made to STPCD in 2013, have removed automatic pay progression and introduced pay linked to performance from 2013/14 academic year onwards.

They also give schools greater freedom to determine what to pay teachers on appointment – removing the statutory obligation to match a teacher’s previous salary

Key considerations for governors:

– Does your school’s pay policy enable you to differentiate and reward good performance ? Is there a clear process and evidence base to minimise the risk of appeals?

– Are the potential outcomes of the pay policy affordable – in the short and medium term? Is there sufficient provision in the budget for pay progression? Have you taken into account staff applying to Upper Pay Range?

– Are you making use of the new flexibilities when setting salaries for vacancies?

Staffing –things governing bodies and the senior leadership can do Review their staffing structure regularly – have you got the right

balance between teachers and other staff? Review their teacher utilisation ratio – what proportion of their time

do teachers spend on teaching? Review their appointments process – have you a good track record

of making the right appointments? Review their use of the Teachers’ Pay Reform – does your pay

policy support your strategic aims? Review their approach to managing staff absence – does the school

use agency staff or its own dedicated team? Use the Efficiency Review Tool

Better benchmarking

How does your spending on teachers compare with similar schools?

How does your spending on goods and services compare with similar schools?

Benchmarking: how much are you spending compared with other similar schools?

Data for a non-London primary (blue) with high FSM; compared with statistical neighbours.

(Source DfE/Audit Commission Benchmarking Website for Maintained Schools)

https://www.education.gov.uk/sfb/login.aspx

Academies Benchmarking tool

Better buying

Does your school have effective procurement processes?

Does your school use the procurement services available?

Does your school benefit from economies of scale?

Procurement of goods and services

Benefits of effective procurement practices:

financial savings that can then be re-invested in your priorities for driving up standards goods or services purchased are fit for purpose suppliers deliver (and continue to deliver) as agreed legal and financial obligations are complied with.

(Advice for effective buying for your school, DfE, 2013, p 3)

Procurement cycle and risk

The Procurement Cycle

RISK/INEFFICIENCIES

Supplier Market Analysis

Functional Specifications

Technical Specifications

Competitive Bidding

Negotiation Ordering & Administration

Contract Management

Specify Buy Order & Pay

Manage

Economies of scale

Too many schools continue to procure on their own for goods and services, failing to realise potential economies of scale. A recent survey of prices for routine items purchased by all schools showed how costs varied hugely by supplier. Many of the items surveyed had a price variance of over 100%, rising to a variance of 966% for one item depending on the supplier selected. (p 30)

A large number of schools fail to access critical information on costs, prices and contracts. Indeed, without joining some form of cluster, it is very difficult for a school to benchmark how efficient their procurement function is. (p 30)

Why don’t these schools Collaborate?

‘If each of these schools spent 5 mins a week with half of these suppliers it would add up to 961 hours of duplicative time a year, not to mention the missed savings opportunities from shared procurement’ (p 19)

• 23 schools within a 15 mile radius• Total non-pay spend £5m per annum• 1828 different suppliers were used• 1524 different suppliers were used for a transaction value of under

£500• The schools in the survey were using the same suppliers but on

varying terms and conditions and paying different amounts

Collaborating with other schools

Table discussion:

Does your school engage in joint procurement activities with other

schools? What opportunities are there for your school to engage in joint

procurement activities with other schools? What are the challenges to joint procurement activities with other

schools? Does your school share staff/expertise/training with other

schools? Has your governing body discussed collaborative working? What

conclusions did it come to?

External support with procurement – framework agreements• Framework agreements may be held by your local authority, public sector

buying organisations (PSBOs) or central government departments.• Suppliers named in an existing contract or framework agreement will have

already agreed general terms and conditions. • For a framework agreement, the main thing you will need to do at a school level

is to carry out a ‘mini-competition’ among the relevant suppliers.

• Existing contracts and framework agreements may be available from:• Your local authority – contact them for details• Pro5• Buying Solutions• Crescent Purchasing Consortium (CPC).

External support with procurement – DfE guidance

Publications:‘Advice for effective buying for your school’, DfE, 2013 ‘Academies procurement resource’, DfE, 2013 Essential school leaders read and understand what is available.Training:‘Buyways*’ online course in procurement skills

Question: Does your school regularly use the advice and resources available?

Protecting the public purse

Does your school have robust systems and processes for the safeguarding and proper use of public funds?

How does your spending on goods and services compare with similar schools?

Safeguards against fraud and theft

‘In the most efficient schools…..their focus on efficiency also creates more robust management systems that reduce

the risk of financial irregularities’ (DfE, 2013, p6)

In 2012/13 councils reported 191 cases of fraud in schools, worth £2.3 million. Of these cases, 86 with a value of £1.9 million involved internal fraud. The results suggest that schools may not have the same level of supervisory checks and controls as large organisations…and may therefore face a greater risk of internal fraud. (‘Protecting the public purse’, 2013, p33)

Good practice in fraud prevention

Features of good control systems are:

financial management checksseparation of dutiesstrictly limited access to systemsspot checks on systems and transactionsinvestigation of every incident of irregularitycareful pre-employment checksstaff responsibilities made cleareffective whistle-blowing policies

Whistle-blowing

Good practice

The school must have a whistle-blowing policy in place – maintained schools will base this on their LA’s policy.

Staff must have someone trustworthy to report their concerns to.

All staff must be aware of the whistle-blowing policy.

Academy trusts should have whistle-blowing arrangements

Looking ahead

What support can schools expect to help improve efficiency?

What can we do to improve efficiency in our schools?

National initiatives

Effective workforce deployment Better benchmarking data Efficiency indicator to be developed Procurement services for schools Greater access to clusters and school business

managers Enhanced role and skills of governors

Facilitating greater access to clusters and school business managers

90% of secondaries have access to an SBM

40% of primaries have access to an SBM

We want to provide small start-up grants to enable clusters of primary schools to take on a school business manager, who could then provide support to the entire group. The grant would last one year only, to contribute towards the initial recruitment costs, but we would then expect the role to become self-sustaining as the schools

start to reap the benefit of that expertise. (p 30)

What can governors do to create an ‘efficiency culture’? Make the link between spending decisions and pupil outcomes….

better spending decisions can help to raise attainment Ensure your school has access to effective financial management

skills Establish efficiency as a norm…….once we become aware that

other organisations are more efficient we tend to change our behaviours

Require the use of information…..ensure that your school uses all of the information available to it

Challenge inefficiency…..this may be time-consuming and involve risks but will often bring long term gains

Reviewing efficiency in your school

Three key questions:Foundations – does the school have access to appropriate business management skills?Practice – are effective processes, procedures and practices in place to promote efficiency?Culture – is there an efficiency culture which permeates the whole school community?

Finding the answers:Conduct an internal review – use the Efficiency Review ToolFind out what other schools are doingRead the ‘Review of efficiency in the schools system’