Financial Year 2021-22

LA and school expenditure

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Introduction

This release contains information on income, expenditure, and revenue reserves of local authority (LA) maintained schools for the financial year 2021-22. It also includes expenditure by LAs on schools, education and community services, and children’s and young people’s services. 

This release does not include expenditure by academies. The number of schools that have converted to academies continues to increase, therefore caution should be exercised when drawing comparisons over time.

You may also wish to view the Schools Financial Benchmarking website for school level data and comparisons.

Figures are presented in cash terms and are not adjusted for inflation.

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Headline facts and figures - 2021-22

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School income and expenditure

Information on income, expenditure and revenue reserves of local authority (LA) maintained schools is sourced from Consistent Financial Reporting (CFR) returns that are provided by schools. You can find school-level information on the Schools Financial Benchmarking website. This includes downloadable files which are available here.

The number of schools that have converted to academies has increased over time. This publication does not include income and expenditure for academies who return their financial information through Academy Accounts Returns. As the proportion of academies increases, the number of LA maintained schools making a CFR return decreases. For the financial year 2021-22, 12,221 LA maintained schools made a CFR return, 3.4% lower than 2020-21 and 27.1% lower than 2015-16.  Therefore, caution should be exercised when comparing trends over time and overall totals should not be used for comparison purposes.

i) School income

In the financial year 2021-22, LA maintained school income was £24.1 billion, £0.4 billion higher (1.8%) than 2020-21.  This included:

  • Funds delegated by the LA for schools; this is reflected in the publication section LA Expenditure on Schools, Other Education and Community.
  • Funds for minority ethnic pupils and those with special educational needs,
  • Pupil premium grants,
  • Other grants and funding,
  • Self-generated income.

In 2020-21 and 2021-22, income also included grants from the Coronavirus Job Retention Scheme, the DfE grant scheme for reimbursing exceptional costs associated with COVID-19, and income from the COVID-19 catch-up premium. This is the second reporting year of COVID-19 grants. 

Total income for LA maintained schools was slightly higher than in 2020-21 in cash terms, and the number of schools (and subsequently pupils) in receipt of this income was lower. Comparisons of income per pupil therefore give a better picture of the trend in school income since 2015-16. 

Places in both pupil referral units and special schools attract high needs funding therefore per pupil income is substantially higher.

95.3% of funding came from LA funding and other grants (of which 1.3% was COVID-19 grants) and 4.7% was self-generated. LA funding is detailed in the section LA Expenditure on Schools, Other Education and Community.  

LA maintained schools received, in total, £23.1 billion in grant funding for the financial year 2021-22: 

  • £19.0 billion delegated by the LA (including sixth form funding),
  • £1.7 billion funding for special educational needs (SEN), this includes top up funding and disability access fund,
  • £1.1 billion for pupil premium,
  • £802.6 million from other grants (including extended school funding),
  • £323.9 million in COVID-19 related grants,
  • £46.8 million for community focused school funding,
  • £16.7 million for minority ethnic pupils.

Due to the COVID-19 pandemic, opportunities for schools to self-generate income (for example through facility hire) were limited in 2020-21. This income stream decreased from £1.4 billion in 2019-20 (5.9% of all income) to £0.7 billion in 2020-21 (3.1% of all income). 

In 2021-22, as schools return to more usual ways of working, there have been increases across the majority of categories of self-generated income. However, the amount generated by schools in each category generally remains lower than in 2019-20.

Schools self-generated £1.1 billion of income in 2021-22 (4.7% of all income); an increase of 57.2% from 2020-21. Increases were seen across all categories of self-generated income with the largest drivers being:

  • Contributions to visits, residential trips, field trips, and boarding fees, an increase of 204.6% from 2020-21 but 37.4% lower than 2019-20,
  • Income from catering, an increase of 120.2% from 2020-21 but 14.1% lower than 2019-20,
  • Income from lettings, an increase of 117.8% from 2020-21 but 10.8% lower than 2019-20.

£323.9 million (1.3%) of school income in 2021-22 came from COVID-19 related grants:

  • COVID-19 catch-up premium - £238.0 million - The COVID-19 catch up premium was announced on 20 June 2020. It aims to support children and young people to catch up on missed learning caused by COVID-19.
  • DfE grant scheme for exceptional costs due to COVID-19 - £66.1 million - This is to offset additional costs incurred by the school. Examples that may apply in 2021 to 2022 include grants associated with testing for coronavirus (COVID-19), grants linked to providing free school meals and the coronavirus (COVID-19) workforce fund for schools. Further information on all COVID-19 expenditure categories is included in the methodology document. 
  • Coronavirus Job Retention Scheme (CJRS) - £19.8 million - The CJRS was payable for only certain categories of staff. Where staff were wholly or significantly funded by self-generated income, schools were able to use the CJRS to protect these staff. 

Full details of all school income can be found in Table 1.

ii) School expenditure

Gross expenditure: Financial spending by LA maintained schools, before any deductions are made.

Net expenditure: Financial spending following deductions of income from catering, supply teacher insurance and community-focussed income.

Gross expenditure reported by LA maintained schools has increased, reversing the trend seen in previous years. Expenditure has otherwise decreased each year since 2011-12, driven primarily by school conversion to academy status and therefore reduction in the number of schools included within this publication. In the latest year, this decrease in the number of LA maintained schools slowed. 

In the financial year 2021-22, LA maintained schools' gross expenditure was £23.9 billion, 4.0% higher than in 2020-21 when total expenditure was £23.0 billion. This included:

  • £11.7 billion (49.0%) spent on teaching staff (including teachers, supply and agency teachers),
  • £4.4 billion (18.4%) spent on education support staff,
  • £3.2 billion (13.4%) spent on premises and occupation related costs,
  • £2.5 billion (10.5%) spent on supplies and services,

Last year, due to the changed situation in schools as a result of the COVID-19 pandemic, schools utilised their finances differently to other years. For example, lower spend on supply teaching, learning resources, catering and community-focussed spend. 

In 2021-22, as schools return to more usual ways of operating post-pandemic, expenditure in these categories has generally increased but, for most categories remains lower than 2019-20:

  • Supply teachers, a 49.7% increase from 2020-21, similar in cash terms to 2019-20,
  • Staff development and training, a 37.4% increase from 2020-21 but 13.1% lower than in 2019-20,
  • Learning resources, a 37.2% increase from 2020-21 but 7.6% lower than in 2019-20,
  • Catering supplies and staff, a 23.9% increase from 2020-21 but 2.7% lower than in 2019-20,
  • Energy costs, a 15.7% increase from 2020-21 but 0.9% lower than in 2019-20. Please note that this period relates to the year ending 31 March 2022 - prior to current energy price rises.

Community spend increased by 2.1% but remains 18.2% lower than in 2019-20. 

Full details of all school expenditure can be found in Table 2

In 2021-22, £621.8 million was spent on supply teaching costs. This includes: 

  • £106.9 million on supply teaching staff employed directly by the school. This represents a 44.3% increase from 2020-21 but 3.6% lower than in 2019-20. 
  • £415.0 million on agency supply teaching staff, 51.2% higher than in 2020-21 and 1.0% higher than in 2019-20. 
  • £99.9 million on supply teacher insurance. This is 3.0% lower than in 2020-21 and 7.7% lower than in 2019-20. Supply teacher insurance includes premiums paid to insurers for supply teacher cover and to the LA for centrally managed supply schemes.

This total spend on supply teachers and agency supply teachers was similar in cash terms to that of 2019-20 and has returned to usual levels following the pandemic. The spend on supply teacher insurance has declined each year since 2015-16. 

Spend on supply teaching varies by phase. Spend per pupil on supply teaching was highest in pupil referral units. It accounted for 4.2% of all expenditure in 2021-22 and totalled £1,219 per pupil - the majority of this for agency supply teachers. This compares to:

  • Special schools - spend per pupil on supply teachers was £693 and accounted for 2.8% of all expenditure in 2021-22. 
  • Secondary schools -spend per pupil on supply teachers was £130 and accounted for 2.0% of all expenditure. 
  • Primary schools - spend per pupil on supply teachers was £160 and accounted for 2.7% of all expenditure. 
  • Nursery schools - spend per pupil on supply teachers was £180 and accounted for 1.7% of all expenditure. 

In 2021-22, LA maintained schools spent £4.4 billion on education support staff.  Education support staff include teaching assistants, who are more widely employed in primary schools, pupil referral units and special schools.

18.6% of total gross expenditure in primary schools and 33.4% in special schools was spent on education support staff. For pupil referral units, 17.9% was spent on education support staff. This compares to 10.3% in secondary schools. These percentages are similar to 2020-21.

Higher supply teacher costs and higher education support staff costs both contribute to the higher spending per pupil seen in pupil referral units and special schools. However, places in both pupil referral units and special schools attract high needs funding as additional costs are needed to support the needs of pupils placed in these settings. Hence the expenditure per pupil is consistently higher across years for both pupil referral units and special schools. 

iii) School revenue balances

School revenue balance:  The financial balance at the end of the year once income, expenditure, committed expenditure and previous year's revenue balance have been taken into account.

Deficit: When a school's expenditure is higher than this year's income, once the previous year's balance has been taken into account. A negative revenue balance.

Surplus:  When a school's expenditure is lower than this year's income, once the previous year's balance has been taken into account. A positive revenue balance.

In 2021-22, of the 12,221 schools that submitted CFR returns:

  • 1,075 (8.8%) schools were in deficit,
  • 11,077 (90.6%) were in surplus,
  • 69 (<1%) had a revenue reserve of 0.

The percentage of schools in deficit increased to 8.8%, from 8.4% in 2020-21.  In 2020-21, the percentage of school in deficit fell, as schools reduced their spend on areas such as supply staff and catering and school supplies. Although they also lost self-generated income such as that from lettings and catering, this was generally lower than the amount saved, therefore increasing their revenue reserve. 

As schools return to more usual ways of working, spend on supply teachers, catering and supplies has increased and although self-generated income is increasing, it is not yet back in cash terms, to pre pandemic levels. This has led to an increase in the number of schools in deficit. However, the percentage of schools in deficit remains lower than in financial years 2016-17 to 2019-20.

In 2021-22, the average revenue balance per school increased to £178,500 from £160,500 in 2020-21. 

The percentage of schools in deficit has broadly decreased in all school phases in the last two years for all school phases apart from nurseries. The percentage of nursery schools in deficit has increased each year since 2018-19, from 17.6% to 29.7% in 2021-22.

By school phase, in 2021-22:

  • Nursery schools - percentage in deficit increased to 29.7% from 24.6% in 2020-21. Average deficit of -£142,900.
  • Primary schools - percentage in deficit increased to 7.6% from 6.7% in 2020-21. Average deficit of -£90,500. 
  • Secondary schools - percentage in deficit decreased to 12.9% from 18.9% in 2020-21. Average deficit of -£866,900.
  • Pupil referral units - percentage in deficit decreased to 14.6% from 17.1% in 2020-21. Average deficit of -£244,100. 
  • Special schools - percentage in deficit decreased to 9.8% from 12.0% in 2020-21. Average deficit of -£405,300. 

The number and percentage of schools in surplus/deficit, plus total amounts of revenue reserves are available in Table 3

For schools in deficit:

  • Nursery schools - average deficit per school increased and total deficit was -£16.1 million. 
  • Primary schools - average deficit increased and total deficit was -£70.9million. 
  • Secondary schools - average deficit per school decreased and total deficit was -£81.5 million. 
  • Pupil referral units - average deficit per school increased and total deficit was -£6.6 million. 
  • Special schools - average deficit per school increased and total deficit was -£23.5 million.

For schools in surplus, all phases increased their surplus:

  • Nursery schools - average surplus per school increased and total surplus was £37.7 million. 
  • Primary schools - average surplus increased and total surplus was £1.6 billion. 
  • Secondary schools - average surplus per school increased and total surplus was £473.1 million. 
  • Pupil referral units - average surplus per school increased and total surplus was £48.1 million. 
  • Special schools - average surplus per school increased and total surplus was £244.6 million.
     

There is substantial variation in the percentage of schools in deficit around the country

There were 22 local authorities with no primary schools in deficit. These are mostly in the Midlands, Yorkshire and the Humber, the North East or North West.  There were 8 local authorities where more than a quarter of primary schools were in deficit, all were in London or the South East. 

For secondary schools, there were 68 local authorities with no schools in deficit, and 4 with 100% of secondary schools in deficit, however 2 of those local authorities only have 1 LA maintained secondary school making a Consistent Financial Reporting return within the authority. 

Local authority expenditure

Local authority (LA) expenditure is collected via Section 251 Outturn returns

In the financial year 2021-22, local authorities spent a total of £44.1 billion on schools, other education and community, and children's and young people's services. Of which, school expenditure consistently accounts for two thirds:

  • Schools (which forms part of LA maintained school income) - £28.8 billion,
  • Other education and community - £3.5 billion,
  • Children's and young people's services - £11.9 billion.

The number of schools that have converted to academies has increased over time. This publication does not include income and expenditure for academies who return their financial information through Academy Accounts Returns. As the proportion of academies increases, expenditure of LAs on maintained schools tends to decrease. Therefore, caution should be exercised when comparing trends over time and overall totals should not be used for comparison purposes.

i) Expenditure on schools, other education and community

In 2021-22, LA gross expenditure on schools was £28.8 billion. This includes £20.2 billion for individual school budgets. The remaining £7.7 billion was spent on services including behavioural support, museum and library services, top up funding and SEN support.

Despite the continuing decrease in the number of LA maintained schools, figures for expenditure on schools are 4.9% higher in cash terms than in 2021-22. 

A further £3.5 billion was spent on other education and community, 14.9% higher than 2020-21.

Expenditure on schools and other education and community, by category is available in Table 4.

Schools

High needs top up funding increased in 2021-22. This is funding over and above the core high needs place funding, which a school or college receives to enable a pupil or student with high needs to participate in education and learning, by type of school:

  • Top up funding for maintained schools increased by 12.5% to £2.0 billion. 
  • Top up funding for non-maintained and independent providers increased by 15.1% to £1.8 billion.
  • Top up funding for academies, free school and colleges increased by 17.9% to £1.7 billion. 

Some SEN services and support categories of expenditure also saw an increase in 2021-22:

  • Direct payments for SEN and disability increased by 56.4% to £26 million.  This relates to LA expenditure under the SEN (Personal Budgets) Regulations 2014 to provide direct payment to the parents of children, or to young people with an EHC plan. The increase may be as a result of the COVID-19 pandemic changing the nature in which support and services were sought by parents and carers.
  • SEN support services increased by 6.4% to £494 million. This includes costs of specialist SEN support services. 
  • Additional high needs targeted funding for mainstream schools and academies increased by 3.4% to £53 million. This is additional funding to ensure schools can support pupils with SEN, where they cannot reasonably do this out of their budget share or other mainstream funding.

Support for inclusion, which includes collaboration between mainstream and special schools and expenditure for the integration of children between settings, increased by 10.6% to £157 million.

Areas of expenditure which have decreased include:

  • Insurance decreased by 19.6% to £7 million. 
  • Behavioural support services decreased by 15.9% to £13 million. 
  • Spend on school improvement decreased by 9.3% to £140 million.
  • Spend on infant class sizes (expenditure incurred in order to make provision for extra classes in order to comply with the School Admissions (Infant Class Sizes) (England) Regulations 2012) decreased by 17.0%, to £8 million. 

Other education and community

In 2021-22 LA expenditure on Other Education and Community increased for services supporting vulnerable pupils with special educational needs (SEN) and disabilities:

  • Home to school transport for pupils with under 16 with SEN increased by 21.4% to £1.0 billion from £829.2 million in 2020-21,
  • SEN administration, assessment and coordination and monitoring increased by 18.7% to £250 million from £211 million in 2020-21,
  • Independent Advice and Support Services (IASS, parent partnership) expenditure increased by 14.9% to £24 million from £21 million in 2020-21.  This relates to the provision or commissioning of, IASS and related guidance and information for the parents of pupils with SEN.

Other areas seeing increased spend included premature retirement costs which increased by 40.4% to £16 million, from £11 million in 2020-21.

ii) Expenditure on children's and young people's services

In 2021-22 LA gross expenditure on children's and young people's services was £11.9 billion, with over half for services for children looked after:

  • £6.1 billion (51.6%) children looked after,
  • £3.0 billion (25.1%) safeguarding children and young people's services,
  • £1.4 billion (12.1%) family support services,
  • £505 million (4.3%) Sure Start children's centres and other spend on children under 5,
  • £409 million (3.4%) services for young people, including £7.8 million on substance misuse and £1.9 million on teenage pregnancy services,
  • £305 million (2.6%) youth justice,
  • £119 million (1.0%) other children's and families' services.

Full details of expenditure in all categories for the financial years 2015-16 to 2021-22 can be found in Table 5.  

Children Looked After 

Expenditure on children looked after (CLA) consistently forms the largest proportion of LA spending on children's and young people's services, accounting for 51.6% in 2021-22. 

In 2021-22 LAs spent £6.1 billion on CLA, an increase of 8.4% in cash terms from 2020-21. The number of CLA is higher than at any point in recent years. Expenditure has followed this pattern; total expenditure per child (based on the population aged 0 to 17) is £474, higher than any point in recent years.

All categories of spend on CLA increased between 2020-21 and 2021-22, the largest rises were: 

  • Short breaks (respite) for looked after disabled children, increased by 21.4% to £44.0 million in 2021-22. 
  • Other children looked after services, increased by 20.2% to £433 million (this includes establishments providing nursing or medical care, mother and baby homes, hostels, living independently, residential employment and youth detention as set out at Legal Aid, Sentencing and Punishment of Offenders Act 2012),
  • Residential care, increased by 13.4% to £2.1 billion in 2021-22,
  • Education of looked after children, increased by 10.0% to £64 million in 2021-22,
  • Special guardianship support increased by 8.9% to £381 million in 2021-22,
  • Leaving care services, increased by 8.3% to £570 million in 2021-22.

Safeguarding Children and Young People's Services

In 2021-22 £3.0 billion was spent on services for safeguarding children and young people. Of this, 88.4% was spent on social work (including LA functions in relation to child protection). This percentage has varied little in the years since 2015-16.  

Family support services 

In 2021-22 £1.4 billion was spent on family support services. This includes, direct payments, short breaks (respite) for disabled children, targeted and universal family support.

Spend on short breaks for disabled children increased by £13.9 million (6.5%), to £226.3 million in 2021-22. However, other support for disabled children decreased by £5.8 million (8.7%) over the same period.  This may indicate that local authorities were changing the nature of support offered to these children following the COVID-19 pandemic. 

Sure Start Children's Centres & other spend on children under 5

In 2021-22 LAs spent £505 million on Sure Start children's centres and other spending on children under 5. This represents a decrease of 1.1% from 2020-21. This decrease in spending is consistent with the trend which has been seen in each year since 2010-11.

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