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Schools: Finance

Volume 488: debated on Tuesday 24 February 2009

To ask the Secretary of State for Children, Schools and Families (1) whether he has plans to control the overall levels of school balances; (256359)

(2) what recent assessment he has made of the effectiveness of local education authorities in preventing the accumulation of excessive school balances;

(3) what recent assessment he has made of the level of school balances.

We will shortly be publishing final data on school balances for 2007-08, but provisional data available through local authorities' published section 52 returns suggests that the total level of school balances at year end 2007-08 is £1.9 billion.

We have not conducted a formal assessment of the progress that local authorities have made with their schools to reduce excess surplus balances. However, my officials have been working with local authorities to gather information about when they have been successful in retrieving surplus balances from schools; or when the authority has encountered considerable opposition from the schools and the public which has resulted in the local authority withdrawing their proposals to claw back balances.

We continue to monitor school balances. When the three year funding settlement was announced in November 2007, local authorities were informed that we expected to see them work with their schools to reduce the total amount of surplus, uncommitted balances held by schools. If we do not see a sizeable reduction of the total balances by the end of 2010-11, then we will seek other measures to reduce this total. We will conduct a wide consultation on a detailed proposition before the measure is implemented.

We have made it very clear that it unacceptable for schools to amass high levels of surplus, uncommitted balances and that their priority is to spend their funding to support the pupils of today.