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Coronavirus and schools: Advice for academies

Rachel Barrett | 24 June 2020

Updated 24.06.2020:  Ever since the first case of coronavirus in the UK, schools have faced a great deal of uncertainty. When the decision was finally taken to close schools to all but vulnerable children, and those of key workers, questions immediately turned to funding.

Fortunately, the government was quick to confirm that schools, including academies will continue to receive their core funding as usual, in addition to top-ups and high needs funding from local authorities.

Now, more information has been made available regarding the additional support which schools will receive to help them cover the costs created by the coronavirus pandemic, including:

  • the impact of schools’ financial reserves on eligibility for this funding
  • details of what support schools can access to cover the loss of self-generated income which is not covered by this fund
  • confirmation that schools should proceed with a phased wider opening and any measures associated with it within existing resources

Below, we’ve set out the full range of funding support that’s available to schools to help them respond to the COVID-19 pandemic.

Core funding allocations

Importantly, schools will continue to receive their core funding allocations.

This core funding will be as was determined by the local authority or, for academies, through the general annual grant (GAG) for the 2020 to 2021 financial year.

For maintained schools, this is the year ending March 2021, and for academies and non-maintained special schools, this is the year ending August 2021.

This funding will be received regardless of any periods of partial or complete closure, ensuring that schools can continue to pay staff and meet other regular financial commitments, whatever happens.

Funding the SEND and high needs pupils

The government has announced that local authorities will also continue to receive their high needs budgets, which is used to pay top-up and other high needs funding for schools.

This funding will ensure that staff who support pupils with SEND can continue to be paid and employed by schools.

In kind, schools are expected to continue paying top-up or other funding for pupils attending alternative provision (AP) or which pay for other SEND or AP services. This is to enable teachers and other staff to continue being paid in accordance with their existing employment contracts.

If schools have not yet agreed placements and services for the summer term, the government says that schools should fund on the basis of previous patterns and commissioning.

However, the funding set out so far does not cover any additional costs related to changes in SEND provision organised by local authorities or individual children and young people with education, health and care (EHC) plans.

Short term cashflow support

There will be schools which are in a very difficult position where they are unable to make up-front payments to cover the additional costs created by coronavirus because of cashflow issues.

This is why, as well as the support for additional costs due to coronavirus explained below, the government has made it clear that the normal processes for seeking short-term advances to support their cashflow are still available.

For academies, this involves contacting the ESFA while maintained schools can contact their local authority. Non-maintained special schools should also seek advice from the ESFA in the first instance.

Additional costs from COVID-19

Schools which remain open will have faced additional costs as a result of coronavirus, and others may experience additional costs in future and they may be unable to cover these with their existing resources.

To support all state-funded mainstream and special schools as well as alternative provision, including academies and free schools, with these costs, additional funding has been made available.

This funding, however, will only cover costs related to specific items only. These are items the government judges will be necessary to allow schools to “provide appropriate support to those children who will continue to attend school under current arrangements.”

Some of the most likely anticipated costs which would be covered by the funding include:

  • Increased premises related costs
  • Support for free school meals for eligible children who are not attending school
  • Additional cleaning requirements.

Schools are not eligible to make claims for any additional costs associated with more pupils returning to school that are not covered by these categories. 

The funding will not cover expenditure which was expected to be incurred for the year, including exam fees for exams which are no longer taking place. If your school faces other, extraordinary costs to deliver appropriate support to pupils through this period that are not covered by this list and cannot be met by existing budgets, you should contact DfE.CoronavirusHelpline@education.gov.uk.

It is recommended that you consider anything that has been impacted by the current crisis and make enquiries as to whether it is covered by funding e.g. delays to restructuring plans.

Schools are not eligible to make a claim against this fund if they expect to add to their existing historic surpluses in their current financial year (September 2019 to August 2020 for academies and April 2020 to March 2021 for maintained schools).

This means schools cannot claim if they began their current financial year with an accumulated historic surplus and expect to increase that surplus this year and thereby finish the year with a higher level of reserves than they started.

Schools are eligible for reimbursement where the additional costs associated with coronavirus would:

  • result in a school having to use historic surpluses
  • increase the size of a historic deficit
  • prevent the planned repayment of a historic deficit

Government are asking schools to make the necessary payments from their existing budgets and record these in line with local finance policies. See guidance on claiming exceptional costs associated with coronavirus (COVID-19) for instructions on how to submit a claim.

Allowances and eligibility

Funding caps are based on school size, with the largest schools, with more than 1000 pupils being eligible for £75,000, while those with 250 or fewer can claim up to £25,000.

Special schools and alternative provision can claim up to £50,000.

The additional support will only be made available to schools which are unable to meet the additional costs from their existing budgets and those which could only do so by drawing down on reserves and “undermining their long term financial sustainability”.

As a result, they are not expecting schools to claim for this funding if they are anticipating that they will add to their reserves in the 2020/21 financial year.

The funding is also not expected to cover additional staffing costs over the Easter and summer holidays, when staff will still be needed to be in school. Instead, the government expects schools to minimise the need for existing staff to work additional hours to cover the holidays.

It recommends doing this through rota systems, offering time-off in lieu, checking with local authorities or academy trusts to identify whether staffing support is available from other institutions and making appropriate use of their supply budget. However, if there are unavoidable additional staffing costs, these should be discussed with the school’s Regional School Commissioner.

It’s important that schools can provide reasonable assurance that the costs they claim for are legitimate additional costs due to coronavirus. For this reason, good record keeping is essential and these should be signed off by the headteacher or school business manager. Schools will also need to identify the funding and its expenditure when reporting their accounts.

As such, we recommend that schools compile a folder of records associated with additional COVID-19 costs and retain this for future reference along with the claim submission. The Department for Education has referred to potential spot checks being carried out in future and this information will be subject to standard audits, so it’s important that all this information is documented.

At Duncan & Toplis, we support a wide range of non-maintained, special and academy schools in the UK. Our team of dedicated business advisers and accountants are passionate about supporting clients and we are here to help. To contact our team, click here.


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