As a number of schools are feeling the pressure of tighter budgets, balancing the books can often lead to strategic compromises. Indeed, this year’s State of Technology in Education report found that 53% of school leaders will struggle to meet their objectives due to budget constraints.
If you’re a relatively new member of the senior leadership team, you may be considering how to make the best financial decisions for your school whilst confidently reporting and forecasting these budgetary choices.
Here are four key tips to improve the budgeting and forecasting processes for you and the rest of the school:
Compare the market
Do you know where your school’s spending sits compared to other institutions? If not, you could compare your income and outgoings with the DfE’s free benchmarking tool. But bear in mind it won’t tell you why there are differences, so you’ll need to read between the lines and fill in the gaps in your reporting.
Of course, budgeting needs to be across the board, from wages to toilet paper. Make sure you’re carrying out annual audits of everything from stationery to utility bills. Could you be spending less with a different supplier?
If you are succeeding at getting the best value for money, let your governors know. By identifying that your school spent less than one in close proximity, you can outline how you will continue to achieve value for money, going forward.
Focus on solutions
Ensure that your budget reports are clear and simple to understand; your governors will appreciate the transparency. Explain what you plan to spend money on and why. Make a business case for areas that need more funding.
It’s also a good idea to discuss solutions rather than dwelling on problems. For instance, you could talk about how you are going to overcome shortfalls in future. If you overspent on insurance, for example, you could suggest negotiating for better terms or finding a more competitive provider.
Include the whole school
Have you recently been fast-tracked into a senior position? If you’ve not managed your staff for long, it can be hard to guess where they think spending is most desperately needed, and where savings can be made.
Consider asking staff members across the school how they think the budget should be spent. What could be done differently next year? Your IT managers may provide valuable input on where tech upgrades are more or less pressing, and whether funds are better spent on improving the existing infrastructure or investing in more edtech. Your teachers, on the other hand, may have training requirements you haven’t considered.
By gathering additional input, you might find that a comparable spend will satisfy a far greater number of school departments. Taking everyone’s challenges on board also goes a long way towards building stronger relationships in the future. Meanwhile, demonstrating this process to the governors will add considerable weight to your budgetary decisions and reporting.
Use accounting software
Investing in school accounting software can make the forecast and budget reporting process far less onerous. They’re often designed specifically for school budgets, and include tools for accounting, billing, accounts payable, purchasing and payroll. With everything in one place, the software will save your finance manager time and provide you with instant, accurate reports.
Try, as well, to check your forecast on a regular basis. Is everything on track, or will you need to revise it? Encourage staff to keep you up to date with spending. The software will help you to evaluate your finances as often as you can check it, while flagging up any risk of falling into the red.
For more insight into the views of classroom teachers and educational leaders, explore The State of Technology in Education 2019/20 report.