The Department for Education (DfE) has recognised that MATs face significantly increased energy costs along with other increased cost pressures this year. As a result, school funding will increase by 4.2% per pupil in 2022/23. However, a large portion of this additional funding will be needed by MATs to meet the increasing costs, especially the sky high energy prices that we are all facing.
Whilst the increased DfE funding is appreciated, it has to cover a wide range of cost increases of which energy costs are just one budget item. If we are honest, I am sure that MAT budgets will have already allocated the increased DfE funding to cover pandemic costs, catch up costs and any salary cost increases.
Such a large increase in energy costs was not anticipated. Reality shows that a very large portion of the DfE increased budget will be allocated to cover the significant increase in energy costs.
One example of this energy cost increase is at Ellesmere Port Church of England College, which is part of Frank Field Education Trust. The school has a very modern building that should be energy efficient. Despite this, the school’s current energy costs are already over £180,000 per annum. However, the recent competitive tendering process has seen electricity costs increased by over 80% whilst gas costs have increased by nearly 100%.
To put these significant energy cost increases into perspective, Ellesmere Port Church of England College will need to find an additional £150,000 per annum, and that’s just to cover the energy cost increase! Whilst the DfE’s 4.2% increase will provide an additional £194,000 to the school, £150,000 of this is immediately allocated for energy supply costs. This leaves just £49,000 to cover all other increased costs that the school will incur.
The additional £150,000 per annum energy cost at Ellesmere Port Church of England College could have been used by the school to employ a further 3 teachers. This increase in teacher numbers would have helped deliver improved pupil outcomes. This is just one example of the lost opportunity cost for our pupils impacted by these increased energy costs!
Turning off the heating and lighting in a school is not an option for any MAT. In addition, MATs also have no option but to pay these sky high energy costs which puts us all in an impossible position. This leaves us caught between a rock and a hard place.
As a result, Ellesmere Port Church of England College is looking very carefully at all energy usage to identify cost savings as the 1st step in managing this very difficult situation. A number of alternative cost saving options exist. We could ask all community users of the school’s facilities to pay a much higher fee. Whether these community users will be able, or willing, to pay these increased fees is a different question. However, this would only go some way towards meeting these significantly increased energy costs.
Another alternative would be to curtail all community use of the school’s facilities whilst the energy costs are so high. However, the negative impact on the community users would need to be considered. These are just some examples of the very difficult decisions that each MAT will now need to take as a result of the sky high energy prices.
Perhaps the government could bring their influence to bear on energy suppliers and get them to follow the example set by Education Software Solutions with SIMS software? They recently introduced a 6 month break clause in their 3 year contract term following pressure from the DfE and MATs. This would at least allow MATs to move to a lower energy cost tariff when supply catches up with demand. It would then make much more efficient use of an already tight budget.
