Call for new government to support financial sustainability

Multi-Academy Trust (MAT) finance leaders have called on the new Labour government to provide multi-year funding settlements, increased budgets to support rising costs and staff pay awards, and higher and fairer funding for SEND provisions to adequately support pupils with special needs. 

These are among the key asks from 101 respondents to the MAT CFO Insights Survey, devised by IMP Software, to support MAT financial sustainability as leaders shared their hopes and fears ahead of the 2024-25 academic year.  

The survey, which was undertaken in June, saw nearly a third of respondents (33) describe their trust’s general financial position as unhealthy or extremely unhealthy, 58 report that their trust is financially vulnerable, and 79 have had to dip into reserves over the past 12 months to cover costs. Out of 53 respondents, a further 46 said this was more pronounced than in other years, and 43 expect this to continue. 

For 2023-24, 62 respondents said their trust is forecasting an in-year deficit and the same number reported that their forecast is worse than projected at the start of the year. Of 51 respondents, 40 expect their trust’s financial position to worsen.  

The biggest financial pain point for MAT finance leaders is rising staff costs (pay increases etc) as identified by 99 out of 101 respondents. The majority of respondents (46) said they could currently afford only a 2% teacher pay award for 2024-25, and the same for a support staff pay award (35). An overwhelming 89 respondents agreed that the current funding announced for 2024-25 is not enough for their trust. 

Nearly all MAT representatives (96), based at trusts of all sizes across the country, said their trust does not have enough funding for the SEND provision it needs to provide; and 70 have capital works they need to do that they can’t currently afford. 

As a result, trusts face reducing staff across both teaching and support roles through natural attrition, non-replacement of leavers, restructures and redundancies; cutting non-essential spending, curriculum budgets, interventions and support services like counselling and pastoral care; increasing class sizes and removing specific subjects due to a lack of teachers; and reducing funding for SEND and alternative provision. 

MAT finance leaders also reported using reserves to cover budget deficits, despite these reserves being previously committed; delaying or cancelling building repairs, maintenance and improvements; limiting resources for learning, enrichment activities and professional development for staff; and implementing recruitment freezes and budget reviews.  

Will Jordan, Co-Founder of IMP Software, said: 

“Our survey outlines several financial challenges faced by trusts, particularly around fair funding, increased costs, salary pay awards, SEND and high needs funding, and capital funding. The difficult decisions being taken by trusts are being driven by funding shortfalls, resulting in significant impacts on the quality and breadth of education and support services provided. Reserves usage is increasing, but this is not a sustainable long-term solution.   

“In response, MAT finance leaders have reported putting in place a range of other strategic measures to improve their trust’s financial position, including centralising operations, GAG pooling, ICFP, larger class sizes, mixed year group classes (primary) and a narrower curriculum (secondary). However, there are calls for more government funding to address real-terms cuts, inflationary pressures and to support pay increases. 

“Trusts were specifically asked ‘What is your single biggest ask of the incoming government to support MAT financial sustainability going forward?’ Overall, the responses emphasise the need for increased, stable and equitable funding to meet the growing demands on schools, particularly concerning staff pay and SEND provisions.” 

In summary, responding MAT finance leaders call on the new government to address: 

• Funding stability and planning: There is a strong call for multi-year funding settlements to provide better planning and certainty. Schools need predictable funding to handle long-term financial commitments, including staffing and pay increases. 
• Pay and costs: Increased funding is necessary to match rising costs and pay awards. There is a need for funding to cover teacher and support staff pay rises fully and consistently. 
• SEND: There is a critical need for increased and fair funding for SEND provisions to adequately support students with special needs. This includes both higher per-pupil funding and more special school spaces. 
• Fair funding and allocation: The funding system should be more equitable, addressing disparities between large and small schools, and ensuring that rural and smaller schools receive appropriate support. 
• Capital and revenue funding: Schools require better capital funding for infrastructure improvements and maintenance. Funding should also align with inflation and cover all necessary revenue expenses. 
• Administrative and legislative changes: Suggestions include simplifying funding processes, improving transparency and reforming SEND legislation. Additionally, addressing the recruitment and retention crisis by ensuring sufficient and timely funding is deemed crucial.