↑ Return to Joining the HfL MAT

Financial Considerations

Academy contribution

Following the admission of the first tranche of academies to the HfL MAT, the Trust will operate a top slice in order to support the Trust Office and its central functions, and to provide a range of shared services. Whilst extensive financial modelling is underway to determine the exact nature of this top slice, and finalise the precise range of services to be provided, it can be stated with confidence that these services will be provided to member schools for a top slice of no more than 5%.

Below is an example diagram of services the top slice will provide, alongside optional services at trust, cluster and academy level:

 

Central services (top sliced, at a maximum of 5.0%)

  • Financial systems, procedures, advice/support and internal control reviews
  • HR payroll system, policies, advice and support
  • Shared IT systems and solutions, including Intranet, MAT communications, and basic SIMS support
  • Core school improvement MCSI, HIP, AGB training, core CPD
  • CEO office, statutory requirements (eg external audit), estate management and legal support

Examples of centrally procured services (optional buy in)

  • Curriculum support
  • IT advice and support, enhanced SIMS, connectivity services
  • Procurement, catering, business management, bookkeeping and monthly reporting, H & S, printing
  • General services for parents and pupils

Examples of cluster level procured services (optional buy in)

  • Grounds, site management, back office functions
  • Specialist staff e.g. family support, behaviour, subject specialists

Individual academy procured services (optional)

  • Wider curriculum support
  • Additional CPD
  • Bespoke services for families, parents  and pupils
  • Equipment and resources etc including IT

In the first 2 years of operation, the Trust intends to offer a core provision of services or back office functions across its academies, and will endeavour to keep central overheads as low as possible. It will also endeavour to secure favourable rates through its negotiating power and expertise for services that will be available should schools wish to take advantage of those rates.

Due diligence

The HfL MAT will draw upon and commission staff with expertise and current knowledge to conduct a range of due diligence work to assess individual schools prior to their admission, including work on education/curriculum performance, financial projections, the status of the school’s property and assets, the position of the school’s LGPS funding, and the accuracy of pupil number projections. Based upon the results of this work, the financial sustainability of applicant schools will be assessed against a scorecard. This scorecard will examine 3-5 year financial projections, sensitivities around pupil numbers, ratios around salary spend on teaching staff, TAs and support staff, and forecast requirements for capital funding.

Those schools that meet the requirements of the due diligence test will be admitted to the Trust, while further work will be undertaken with those that do not meet the required standards. This work will focus on the development of an action plan to improve the financial status of the applicant school, to offset risks and to revise financial projections. The Trust will be able to draw upon HfL Ltd’s experience in successfully providing extensive financial advice and support to more than 40 schools over the past year. This has included reviews, recommendations, putting teams around the schools in the most financially challenging circumstances and chairing financial action groups to reduce deficits and put schools on a more sustainable financial footing.

It is the intention that rather than reject from admission to the HfL MAT any maintained school on the grounds of its financial position, the Trust will support all schools in meeting the financial criteria required prior to becoming an academy within the HfL MAT.

Applicant schools will be welcome to join the MAT if agreement can be reached with their local governing body and headteacher to commit to delivering the action plan set out by the sponsor, to ensure that the school is financially sustainable. We are confident that, from our experience of this work with schools in Hertfordshire, action plans can be put in place to turn around the financial fortunes of schools in the most challenging circumstances.

Nature of academy contribution

Following the admission of the first tranche of schools to the HfL MAT, the Trust will operate a top slice in order to support central functions, and to provide a range of shared services. Extensive financial modelling has taken place to determine the exact nature of this top slice, and the precise range of services to be provided. At this stage, it is not expected that the top slice will exceed 5%.

The top slice will include:

  • Financial systems, procedures, advice and support
  • HR policies, advice and support
  • Core school improvement, MCSI, HIP, AGB training, core CPD
  • Estate management advice and support for the portfolio of member schools
  • Provision of legal support
  • Functions of the Trust Office

Functions of the Trust Office, to evolve over time, will include:

  • CEO and CFO
  • Administrative support at the central MAT level
  • Premises management for Trust premises
  • Office running costs
  • Recruitment costs
  • Marketing and website
  • Finance software systems
  • Audit and statutory reporting
  • Subscriptions
  • Travel & meetings
  • IT support (including desktop, licences, connectivity and SIMS basic support)
  • CPD of Trust staff, including annual conference

Shared services

As the number of academies in the HfL MAT increases, and the income of the Trust increases, opportunities will be taken to review the provision of shared services and of back-office services in particular. These reviews will be performed in the context of the Trust’s need to ensure proper use of public funds, and the need to deliver value for money with improved quality in service provision. It is anticipated that the HfL MAT will invest in the provision of some additional central services as the Trust grows, to remove costs from individual academies and provide more efficient and effective services for example site management costs shared across local small schools.

Permanent link to this article: http://www.hflmat.co.uk/joining-the-hfl-mat/financial-considerations/