A large academy trust has slashed its central services charge on primary schools in a bid to support those hit by plunging rolls – increasing the burden on its secondaries instead.
Northern Education Trust has decided not to collect a percentage top slice of its primary academies’ budgets this year, instead opting to charge a £20,000 flat-rate. Almost two-fifths of places are unfilled at one of its primaries.
Experts say more trusts are now reviewing their top slice arrangements amid grim forecasts that places will plummet by hundreds of thousands over the next eight years.
Rob Tarn, NET’s CEO, said: “Based on a top slice, primaries on average might have to pay £40,000, £50,000 to a MAT [multi-academy trust].
Academy trust’s secondaries to take the burden
“If you’re at a small rural primary school that could be a significant proportion of their budget. We can do it because we have a large number of schools generating surpluses.”
Two of his primaries have been impacted by the issue, with the worst-affected being The Oak Tree Academy, in Stockton-on-Tees, where 172 (39 per cent) of its 431 places have been left empty.
Tarn added that NET’s changes are also part of attempts “to get ahead” of the issue in “other areas where we see the demographic trends falling”.
His secondaries – which have “rapidly rising” numbers of pupils – were charged 6 per cent of their budget, or general annual grant (GAG) funding, in the past financial year. This is up from 5 per cent in the previous 12 months.
‘Primaries will think they can join us’
Tarn said: “You need multi-academy trusts to say, ‘when you sponsor that massive secondary school that’s generating £1 million, what you need to do is go and sponsor that rural primary school that’s on its own and struggling’.”
He also thinks the move will convince smaller local authority-maintained schools “that they can join [the trust] and it’ll be affordable to them”.
Headteachers have been struggling to fill reception classrooms in the wake of a national birth-rate dip of 13 per cent since 2015.
Government data suggests primary pupil numbers will tumble by 760,747 (16.6 per cent) between 2022 and 2032. In London – which has been rocked by a double-whammy of falling births and the housing crisis – some areas are expected to witness drops of up to 15 per cent by 2027.
London academy trust has waived central charges
Harris Federation has merged two of its inner-city primaries, while two more are set to cut their admission numbers. CEO Sir Dan Moynihan said he has cut top slices and even waived them completely for some primaries. There have also been cases where the trust has covered 50 per cent of academy deficits, the largest of which was £150,000.
Moynihan said: “In others we’ve been cross subsiding from secondary to primary. Where schools are downsizing, we want to cushion that.”
As well as top slicing, trusts can fund their central services by GAG pooling – where they collect all their schools’ budgets first before dishing out funds based on their own formula, which doesn’t have to be published.
The 2023 Academies Benchmark Report revealed that nearly 25 per cent of more than 300 trusts GAG pool, compared with 14 per cent in the previous year.
Kimberley Foulkes, one of the firm’s audit managers, has seen a growing trend of MATs reviewing their top slicing policies “particularly now with increasing cost pressures and some falling pupils on the roll”.