Gerry Steinberg MPIn the House...

Commons Gate

Local Management of Schools (HC 418-i)

Public Accounts Committee 2 Mar 2005

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Evidence given by Mr Gerry McGinn, Permanent Secretary and Ms Katrina Godfrey, Head of Resource Allocation, Northern Ireland Department of Education

Q13 Mr. Gerry Steinberg (City of Durham): Mr McGinn, I have to say that the Tories did not have a very successful education policy in the eighties but the one thing that they did introduce when I was a headteacher was LMS. It was excellent - do not write that down! As the head of a school I found that if I ever wanted to buy a drawing pin I had to go to the contractor to get that, fill an order form out and then wait probably six months for the contractor to deliver. If I had a broken window I could never just get it mended. I used to have to put it out to the county authority who would then send a workman (or probably ten workmen) to repair it, so LMS to me was a great innovation. In 2.3 it says that the functions of boards of governors are set out in legislation. How many governing bodies and heads take this seriously: "In general, to manage and control the school; to appoint teachers and other staff; to draw up admission criteria; to determine the curriculum policy", etc., etc. I can tell you again that when I was a head and had governors' meetings the governors thought they were doing that but in fact I was doing it and I used to get them to rubber-stamp it, which they always did. How many schools in Northern Ireland take that seriously, or do the heads run the schools and get the governors to rubber-stamp what they do?

Mr McGinn: There are a number of statistics in the report which illustrate the role that governors are playing. The stronger data in this report are around being involved in the approval. The less strong data are around monitoring. We believe progress has been made but more has to be made. We are introducing in September this year the regulations around the school development plan which I think will give us a better chance of getting that balance right.

Q14 Mr. Gerry Steinberg (City of Durham): Do you know, for example, how every school in Northern Ireland operates?

Mr McGinn: What I do know is that something like 79% are using the school development plan and that is seen as important. We have got inspection evidence as well which shows the terms of involvement of boards of governors and particular governors and also the use of the school development plan. There is still scope for improvement and by putting that as mandatory and supporting it through training we believe we have a better prospect of getting that balance right.

Q15 Mr. Gerry Steinberg (City of Durham): Very often it is a very onerous job now being a school governor. I have got plenty of friends who are on governing bodies back in the constituency and some who are chairmen of governors. It is a time-consuming activity now and a very onerous job, particularly if they are making decisions on the finances of the school. School governing bodies in the main in my view are far too big to make the decisions because they are going to be called in on a very regular basis. In England what appears to happen is that finance committees are set up as a sub-committee of the governing body. Does this happen in Northern Ireland?

Mr McGinn: It is reflected in the report as well in terms of finance committees being popular.

Q16 Mr. Gerry Steinberg (City of Durham): It says in 2.4, "The schemes of management allow for the establishment of sub-committees of Governors but indicate that the financial functions of the full Board of Governors may not be delegated to a committee, other than to a finance committee". I would not have thought you would delegate it to the rugby committee. How many take that option and do delegate to a finance committee?

Mr McGinn: 67% is the figure quoted in the report which reflects that a significant number use the finance committee. We have about 14,000 governors in Northern Ireland. I would like to place on record the point you were making in terms of the fact that they give freely of their time .

Q17 Mr. Gerry Steinberg (City of Durham): So you are putting up for election somewhere as well, are you?

Mr McGinn: No. I am kept busy with this job.

Q18 Mr. Gerry Steinberg (City of Durham): If you have a finance committee, on that finance committee you can get in expertise, somebody who might have some financial experience. You are saying that 67% of the schools actually have a finance committee. How often do those finance committees meet?

Mr McGinn: There is evidence in the report that the vast majority meet regularly. They are supposed to meet at least four times a year and they do that. We have a lot of small schools in Northern Ireland and therefore in terms of the formality around the finance committee that is something that may not be quite as large a feature. Over a third of our primary schools, for example, have less than a hundred pupils.

Q19 Mr. Gerry Steinberg (City of Durham): Out of the rest that is 23% who do not have a finance committee. What percentage of those would be the small primary schools? All I am getting at basically is how many of the big secondary schools do not have a finance committee?

Mr McGinn: 37% of primary schools have less than a hundred pupils, so it is a very significant number. We are confident that the vast majority of the post-primary schools have both finance committees and the mechanisms in place, given that their budgets are significantly greater as well, given the pupil numbers.

Q20 Mr. Gerry Steinberg (City of Durham): I am not sure you answered the question. How many secondary schools do not have a finance committee?

Mr McGinn: Out of the 233 I cannot give you a precise answer in terms of how many do not.

Q21 Mr. Gerry Steinberg (City of Durham): I think it is important because in my view as an ex-head those who do not have a finance committee cannot do the job properly or the head is doing what I did: he is running the finance budget, and then of course you get the problems of running into deficit or surplus. I would be grateful if you could find out and tell us in a note how many secondary schools do not have a finance committee. Also, I do not particularly believe that there should be financial experts on a finance committee but clearly they have to have some idea. What provision do you give heads (because heads are becoming managers or accountants these days rather than teachers) or governors who are on finance committees to train in the necessary accountancy skills?

Mr McGinn: The report points out that 66% have a business background and that is helpful in terms of having that finance background and skill. What we are trying to get is a balance between the governor as a critical friend, both supporting and challenging, and equally equipping the principal for the future. With a professional qualification for headship we have 355 who graduated from that. The pattern in the last two years has been 200 per annum. For the next three years we expect that to continue with 200 for each year. We have a two-year induction programme for principals and vice-principals which has been well attended and we have a course linked in with business in the community and we put 300 teachers through that.

Q22 Mr. Gerry Steinberg (City of Durham): That is good. When I read the report I got the impression that there were many schools where governors did not get involved in the budget setting. If you look at paragraph 3.20, the second bullet point, it says, "When asked specifically about budgetary matters and who was responsible for budget monitoring within schools, 34 per cent of schools said that governors were responsible". That means that 66% did not. That is rather worrying because it seems to me that those governors are just letting the head get on with it.

Mr McGinn: There is no doubt that the stronger evidence in this report is in terms of approval. Monitoring has been highlighted as an issue and we believe that in terms of the role of the school development plan, where the regulations make it mandatory, it should be setting out very clearly the expectations on both parties.

Q23 Mr. Gerry Steinberg (City of Durham): So is it surprising that there are large surpluses and deficits within Northern Ireland if you have 66% of governors saying they do not think it is their responsibility to monitor the school budget where they are supposedly running the school?

Mr McGinn: Yes, it is. In terms of the support that we have provided it obviously has not been sufficient to deal with that and that is something that we continue to assess each year.

Q24 Mr. Gerry Steinberg (City of Durham): We all know that staff costs are the biggest cost in any school. If a school, by the fact that the governors have not done their job properly, run into huge deficits, the easiest way to get rid of that deficit is to sack staff. Have you any record or evidence that this has happened in Northern Ireland?

Mr McGinn: Staff costs account for 80%; you are absolutely right. When we look at where the deficits are occurring a significant number are in schools with less than a hundred pupils.

Q25 Mr. Gerry Steinberg (City of Durham): So if they are making staff redundant that is desperate.

Mr McGinn: Those are three- or four-teacher schools, so there is no doubt that that is an issue. There are two dimensions, as you know. One is pupils and the expectation for the future: is it going up, steady or going down? You are absolutely right in terms of a situation where -----

Q26 Mr. Gerry Steinberg (City of Durham): Has anybody been made redundant?

Mr McGinn: Yes, they have.

Q27 Mr. Gerry Steinberg (City of Durham): Could you give us a note on how many redundancies have been made, in which schools, showing us, if those schools have made teachers redundant, where there has been a deficit in the budget?

Mr McGinn: I know that there were about 300 redundancies last year and we will relate that across.

Q28 Mr. Gerry Steinberg (City of Durham): How many teachers are there in Northern Ireland altogether?

Mr McGinn: Just over 20,000.

Mr. Gerry Steinberg (City of Durham): So what is that as a percentage?

Jon Trickett: One and a half.

Q29 Mr. Gerry Steinberg (City of Durham): That is quite high, is it not?

Mr McGinn: There has been a significant number of closures and amalgamations in the period.

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Q91 Mr. Gerry Steinberg (City of Durham): We have concentrated on a lot on the deficits but surpluses also cause headaches and we have had the information given that a considerable number of redundancies have taken place. On the other hand, there are huge surpluses in some areas. You can see where I can go from here. Why on earth should teachers be made redundant when other schools are hanging on to considerable surpluses? Has this solution been looked at?

Mr McGinn: Yes in terms of now looking at Northern Ireland in totality - and I know this was an issue that you raised the last time I was with you - we have been looking at a number of steps to try to address that and get the matching, particularly in a period where the demographic decline is going to apply particular pressure. I think there are solutions that we are taking forward to try to address that particular issue.

Q92 Mr. Gerry Steinberg (City of Durham): It is quite outrageous, is it not, that teachers are being paid off in one school which could be 100 or 200 or 300 yards away from a school where they are sitting with huge balances. That is not morally right or educationally right, is it?

Mr McGinn: That is absolutely right.

Q93 Mr. Gerry Steinberg (City of Durham): The money has been provided, after all, for the education of children by the government via yourselves I presume.

Mr McGinn: What has been happening is that the board have a responsibility for the five geographical areas and obviously it is joining all of this up. What we have done in looking at the plans that we have received because (we have requested and received the plans for those surpluses in excess of 5%, so we have 400 plans with us as well) is matching these to make sure that appropriate behaviour in terms of use of resource and use of public money is happening

Q94 Mr. Gerry Steinberg (City of Durham): Why are the surpluses so big when in fact the money that is provided by central government is based on what is assumed to be the amount needed to be provided to give a decent education? So why are the surpluses so big? Why are they there? What are they being used for? Just as a matter of interest, on figure 6, page 53 I notice, for example (and I do not even know where it is, to be quite honest) but South Eastern has huge surpluses. Why particularly have they got such big surpluses?

Mr McGinn: There are two dynamics there. The first is that under their particular formula (because up until the end of March and through LMS there have been seven formulae in Northern Ireland but five for five boards, one each) they were putting more money out to the schools. Secondly, the expectation of the Southern Eastern board as to the common funding formula (although it is going to be in place from 1 April 2005 it has been talked about for a number of years and there was consultation in 2001) is that it would be a loser under the common funding formula.

Q95 Mr. Gerry Steinberg (City of Durham): So they have been saving money?

Mr McGinn: They have been saving money. In the plans we have talked about that gives us the specifics. That has been the dynamic in play.

Q96 Mr. Gerry Steinberg (City of Durham): So what will happen to these surpluses not just in South Eastern but elsewhere? What will they use these surpluses for and how quickly will they spend them?

Mr McGinn: In terms of being able to answer your question we have the plans which we have received. Those are under constant review now normally twice a year at the meetings at which the boards' chief executives meet to talk about accountability and we are monitoring those so we want to ensure that the money that is there is being properly used. If I go through those 400 and odd school plans ---

Q97 Mr. Gerry Steinberg (City of Durham): The big danger is that, frankly, they should not be allowed to keep huge surpluses because they do not need them, unless they are having a big project they are saving for but even then it should be spent more quickly than perhaps it is. What worries me also is if you have a situation where a school has a huge surplus they might decide to get rid of it frivolously because it may well be taken off them. That is a danger as well.

Mr McGinn: They cannot spend it on capital in Northern Ireland.

Ms Godfrey: No, that was precisely the point of the plans because certainly we had thought rather than just focusing on deficits we ought to focus on surpluses as well and requirements in plans to make sure that did not happen. The last thing that anybody wanted was a warning shot about surpluses which would result in silly spending. That is why we replaced the three-year plans which have to be scrutinised and approved by the relevant board to make sure that there is a sensible plan.

Q98 Mr. Gerry Steinberg (City of Durham): At the end of financial year you have not bought a new carpet or an easy chair for your office, have you?

Ms Godfrey: Absolutely not.

Mr. Gerry Steinberg (City of Durham): You are the only one who has not then!

This is an uncorrected transcript of evidence taken in public and reported to the House. The transcript has been placed on the internet on the authority of the Committee. Neither witnesses nor Members have had the opportunity to correct the record. The transcript is not yet an approved formal record of these proceedings.

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