Written question asked by David Laws (Liberal Democrat) on Wednesday, 9 January 2002, in the House of Commons. It was due for an answer on Friday, 18 January 2002. It was answered by Stephen Timms (Labour) on Friday, 18 January 2002 on behalf of the Department for Education and Skills.

Dept for Education and Skills

Question: To ask the Secretary of State for Education and Skills, if she will make a statement on the level of schools' reserves; whether the present level of reserves is in excess of guidelines; and if she will make a statement. - Inc figure.

Answer: Mr. Laws: To ask the Secretary of State for Education and Skills if she will make a statement on the level of schools' reserves; whether the present level of reserves is in excess of guidelines; and if she will make a statement. [27050] Mr. Timms: At the end of the financial year 1999-2000, balances held by maintained schools in England amounted in total to approximately £723 million: this figure is derived from the outturn statements prepared by local education authorities under section 52 of the School Standards and Framework Act 1998, and represents surpluses net of deficits. Prudent financial management will normally entail the retention by schools of reasonable reserves, whether on a contingency basis or by way of saving to meet large planned items of future expenditure. In view of the widely varying circumstances of individual schools, my right hon. Friend does not consider that the promulgation of specific guideline figures by the Department would be helpful. It is the responsibility of LEAs to monitor the level of balances in the schools which they maintain, and to challenge those schools whose balances appear, in all the circumstances, to be excessive. Where a school persistently retains a large balance for no clear reason, it is open to the LEA to consider whether delegation should be suspended under section 51 of the School Standards and Framework Act.

Secondary information