Finances at ‘crisis’ point for many schools in Carmarthenshire, says cabinet member

Financial pressures are reaching a crisis point for many schools in Carmarthenshire, as reported by a senior council member. Cllr Glynog Davies, responsible for education and Welsh language, emphasised the urgent need for school leaders to understand the gravity of the situation. A recent cabinet report revealed that the county’s schools are projected to overspend by £10.8 million this financial year. Although as of June 30, there is a nine-month window to address this shortfall, less than half of the schools are expected to be in surplus by March 31 next year.

The report detailed the financial status of each school, with nearly half anticipated to have a surplus by March 31 next year, currently amounting to a collective surplus of £5.2 million. However, this figure is overshadowed by a projected deficit of £5.6 million based on the current trajectory. Some secondary schools are forecasted to face significant deficits, with two schools expecting a £1.9 million and £1.7 million shortfall, while a third is on track for a £2.1 million surplus. The financial challenges have prompted the council to send a letter to school leaders and governors to provide a transparent overview of the situation.

Cllr Davies acknowledged the immense difficulties posed by the financial circumstances, expressing the necessity for schools and governing bodies to grasp the severity of the matter. Describing it as a crisis, he stressed the need for awareness and proactive measures. Cllr Alun Lenny, responsible for resources, echoed the sentiment, highlighting the critical nature of the issue. The budget projections do not account for upcoming teacher pay and pension increases, adding further complexity to the financial predicament.

The council’s budget monitoring report indicated an overall forecasted overspend of £17.9 million, with unplanned costs in children’s services contributing £3.2 million to the shortfall. Continued growth in high-cost residential placements for children and the reliance on agency staff were identified as key factors driving the budget deficit. Despite plans to utilise reserves to alleviate some of the financial strain, the council anticipates a deficit of £9.6 million based on current estimates.

Attributing the budget pressures to years of central government underfunding, Cllr Lenny described the situation as a crisis. The forthcoming budget announcement by Labour’s new chancellor, Rachel Reeves, on October 30 is anticipated to shed light on funding allocations for Welsh councils in the upcoming financial year. Council leader Darren Price emphasised that Carmarthenshire’s financial challenges mirror those faced by all Welsh councils, underscoring the need for sufficient support from central government.

The Welsh Government highlighted a 7.9% increase in local government funding for the previous year and a 3.3% rise in the current financial year. Funding for teacher pay remains the responsibility of councils, with additional financial support provided as needed. Nicola Fitzpatrick, interim Wales secretary for National Education Union Cymru, raised concerns about the strain on school budgets and emphasised the importance of supporting children’s educational experiences amidst financial constraints.