Chancellor George Osborne announced plans to spend almost £1bn on academies and free schools in his Autumn Statement yesterday (November 5th 2012) alongside investment to expand good schools in areas with a severe shortage of places.
However, despite there being £275m to be spent in the next tax year and £895m the year after, London councils think that the figure will fall short of what is needed to address the shortage of school places in the capital.
London will need 90,000 extra places by the 2015/16 school year and this area alone will cost around £2.5bn, which is more than double the amount the Chancellor plans to spend nationally.
The local Government Authority says that councils should have a say in how the money should be spent, as they have ‘on the ground’ knowledge of the state of the schools in their area.
The extra money for academies will come from cuts to current spending by Government departments, while Mr Osborne also announced that he will support performance-related pay for teachers, in a move likely to spark opposition from unions.
Although the Government is not set to pursue local pay bargaining as it had previously suggested, the Chancellor said there should be greater flexibility for individual schools to set pay levels.
The Autumn Statement documents also revealed that the Government’s Priority Schools Building Programme, which funds repairs and new buildings at schools in the worst state of repair, will be the first scheme financed by a new private finance programme, called Private Finance Two (PF2).
Under the PF2 scheme, the public sector will take a stake of up to 49 per cent in individual private finance projects, with 20 per cent likely to be the typical share, and will appoint a director to the boards of each project to ensure that the taxpayer gets a share of any profits from the deal.
As an accountant, Gill Freeman specialises within academy finances and charity tax.