Political changes look set to have an impact on academies’ finances

Education has been a popular topic of debate among the main political parties in the run-up to the next general election (to be held on Thursday 7th May), with the future of academies featuring heavily in party manifestos.

The Labour party recently announced that it intends to boost spending on schools through a clampdown on the £2.5 billion of cash surpluses held by academies, meaning that those funds would be eliminated.

The plans have been criticised by many academy leaders who are already concerned that they will face drastic budget cuts following the election, whichever political party (or parties) are in power.

Despite claims that academies have a cash surplus, recent independent reports indicate that, in some cases, many will face the prospect of their cash reserves running out in the very near future if they fail to implement a new and effective strategy.

Both the Conservatives and Labour have published their education funding policies for the election and both offer cuts in real terms, while the Liberal Democrats have been criticised for failing to pledge full support to academy freedoms.

The heads of some of Britain’s top state schools have already warned that a Labour Government would immediately reverse recent education reforms and abolish academy freedoms by reinstating what they believe to be a “proper local authority framework for all schools”.

In April, 80 head teachers expressed their fear that academies could fall under state controls once again, despite the fact that they are more likely to be rated as “outstanding” or “good” by Ofsted.

Richard Harman – Chair of the Headmasters’ and Headmistresses’ Conference (HMC) – recently made his opinion clear that any decisions regarding how the education system operates should be made on the basis of classroom experience and not by politicians.

However, post-election political changes are likely to have numerous impacts on how academies operate.

Experts are calling for academies to seek advice regarding their business models, including their budget strategies, so they can strengthen their financial positions and easily adapt to potential legislation changes following the election.

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