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Access Education Finance
How can MAT finance leaders give schools freedom without losing control?
Through strategic centralisation, clear policies and joined up, collaborative processes, finance leaders in multi-academy trusts (MATs) can give schools the freedom they need while maintaining the necessary oversight and control. Striking the optimum balance is challenging; schools within a trust often have varying needs, while finance leaders are held accountable to MAT-wide goals.
In addition, many trusts regard financial sustainability as their top concern, highlighting rising costs, inadequate funding and falling pupil numbers. In this challenging environment, leadership and collaboration become even more important to maximise budgets across the trust. Explore strategies for centralisation that can also allow schools freedom, empowering finance leaders to achieve balance for maximum effectiveness.
Strategies to achieve flexible centralisation
Schools want the flexibility to create their own budgets that will be reflective of their local contexts. However, central teams still need visibility to maintain financial health and compliance across the trust. Too much freedom at the school level increases risk and may result in inefficiencies, but not enough can lead to disengagement and dissatisfaction.
81% of trusts are now fully centralised. With increasing centralisation, trusts will need to make it work for all finance teams. Explore strategies and action plans that can deliver both control and flexibility.
GAG pooling
Pooling the general annual grant (GAG) from all schools can ensure central services are covered. A smaller pot can then be allocated to each school for them to manage, allowing for autonomy while building out robust central support that means more can be done at trust level.
The National Governance Association points out that while many trusts pool GAG funding, some only pool elements and leave the rest to local control. Other funding streams, such as pupil premium, may also be more effectively controlled locally than centrally.
Top slicing
Top slicing takes a portion of each school’s budget or GAG to fund central services. This can leave a larger pot for schools to control, while still paying for the essentials. There may be a flat contribution rate, or trusts can collect variable amounts depending on individual need. This can afford finance leaders a manageable degree of control, ensuring services are covered but schools have the budget to maintain their autonomy.
Integrated systems
It’s essential that MAT-wide tasks are not being duplicated at school level, and vice versa. Integrated systems can give finance leaders essential visibility, keeping each school accountable without interrupting its day-to-day flow. Through effective integration, MAT and school financial processes can co-exist and complement each other without the risk of data loss, duplication or silos.
Scenario planning and forecasting
Accurate, detailed forecasting can give trust finance leaders clear oversight of each school’s trajectory and the decisions they may need to make over the coming years. Scenario planning helps find the right solutions and can guide finance leaders as they devise and amend central services, ensuring schools are supported based on future need.
Real-time reporting
Integrated financial software can pool data across the trust, giving leaders unique access to real-time facts and figures. With this enhanced visibility, finance processes can operate in tandem at school and MAT level with greater control and accuracy.
How do we compare to IMP? Read the detailed breakdown.
Building culture by offering school-led support
Central finance teams can feel disconnected from the schools they serve, which can lead to assumptions about the support they require. Building relationships and understanding what schools actually need can help to get buy-in from all parties and will allow leaders to see the bigger picture. With academy conversions back at pre-Covid levels, MATs can expect change and good communication will help mitigate risk.
These are some practical steps MAT finance leaders can take:
- Meet with leaders and school support teams. This is an opportunity to understand how schools manage their budgets and what’s unique to that setting.
- Keep open channels of communications. All teams are part of the same trust, and it should feel that way. Transparency builds confidence and helps schools see oversight as a safety net, not a restriction.
- Bring schools along on the journey. Change can be worrying, so schools need to be informed of upcoming changes well ahead of time. Framing change in the right way can keep schools engaged with the overall mission. For example, a new checklist that schools “must” complete could come across as arduous. But a new checklist that will minimise compliance admin by allowing central teams to step in becomes a benefit, not a burden.
How CFOs are balancing autonomy and oversight
Learning Accord, a dynamic MAT managing a network of academies, uses Access Education’s financial management solution, giving Deputy Chief Executive Officer & Chief Finance Officer (CFO) Gemma Falconer the ability to manage finances at scale.
The system has transformed the trust’s approach to budgeting and oversight, providing a clear and uniform view across schools and alerting Gemma to anomalies that could indicate an issue early on. Schools retain the flexibility to set their own budgets, while the centralised system gives Gemma the tools to maintain overall consistency and alignment with trust-wide goals.
This balance ensures that each school can manage its finances effectively while adhering to the trust’s financial standards.
Implementing financial frameworks that work across MATs: Practical tips for CFOs
CFOs can take everyday actions to find the right balance between oversight and autonomy:
- Standardise processes while allowing room for flexibility. Processes and workflows should be clearly documented and widely understood, however there is no need to be prescriptive. The most effective processes will allow schools to apply them flexibly.
- Look for exceptions instead of trying to look for everything. Reporting tools can flag anomalies before they become bigger issues, so there’s no need to micromanage.
- Involve schools in conversations about finances. Ensure views are listened to and autonomy feels respected at all levels.
- Delegate effectively. Once the right tools and finance systems are set up, CFOs can delegate tasks with confidence and focus on the trust as a whole.
Designing the systems and processes that create balance
Different systems work better for different trusts. In highly centralised trusts, average end-to-end costs per pupil can be as much as 40% lower. But for smaller trusts consisting of mainly secondary schools, benchmarking data shows efficiency is achievable with a very small central team.
True financial leadership is about designing systems and processes that can deliver autonomy and oversight in the right measure for each setting. Integrated systems backed by cloud technology can do much of the heavy lifting, supporting budgeting, reporting, data management and communications that lend confidence and consistency to central teams, and empower schools to manage their resources effectively.
Explore Access Education Finance and its powerful capabilities for MATs.
