One of Wales’ top-performing schools has been given an emergency payout to stay afloat and is making staff redundant to cut costs as it faces a deficit of almost £600,000. A damning auditor’s report into spending at Stanwell School in Penarth reveals a £283,000 overspend on a new wellbeing centre, poor governance, and budgeting.
Vale of Glamorgan Council has confirmed it has given Stanwell School an undisclosed emergency pay out. In total the foundation school's deficit amounts to £588,165 and 17 jobs are going including teachers and support staff.
The auditor’s report showed “significant weaknesses in aspects of financial management” and “unrealistic” budgeting, the council said. As a foundation school Stanwell gets public money but runs its own budget and decides its own admissions processes.
The school has now confirmed it will consult on coming back under council control. It has written to parents telling them a consultation on this will be held in the autumn term.
Governors run school budgets but the audit report for 2022-23 shows Stanwell’s full governing body was not updated on the financial situation. The new wellbeing centre was estimated to cost £784,783 but this rose to £1,068,630. There was no formal contract to show who had been awarded the work on the centre, the Fair Funding Scheme for Funding Schools’ advertising and tendering process wasn’t followed, and the selected contractor’s director’s previous company had gone into liquidation.
The auditor’s report says: “No evidence was viewed in relation to how the work was advertised or how the companies within the process were selected. No formal contract or agreement was on file in relation to the contractor who was awarded the building project.”
There were also overspends on exam costs, furniture, and PE equipment and five new associate assistant heads were appointed in 2022-23 without clear explanation of how that would be funded in minutes of meetings, the report shows. ICT costs were £25,000 overspent and the school’s catering service is now running at a loss, the document also shows. A bill for £479.16 spent on gifts of flowers, alcohol, and vouchers for staff was also "not appropriate". "As these are clearly not for business purposes or to the direct benefit of the children expenditure of this nature from the unofficial fund is not considered appropriate," the auditor says.
A spokesman for the Vale of Glamorgan Council said: “A review carried out by the Regional Internal Audit Service has given an opinion of no assurance into aspects of the financial management of Stanwell School relating to the 2022-23 financial year. The audit was undertaken in March after it was brought to the attention of the council’s head of finance in February that the school was facing a significant budget deficit and required an emergency financial intervention from the council to address cash flow issues for the remainder of the 2022-23 financial year.”
The council said “a report of this nature is very rare” and no other schools in the Vale are in a similar position. Other schools in the authority said they have been told their budgets won’t be affected by any bail outs to Stanwell but there are concerns.
Stanwell’s head teacher Trevor Brown has a new job at the EAS school improvement service. James Mansfield has been appointed acting head from September 1.
In a letter to parents, seen by WalesOnline, the school said: “Stanwell School approached the Vale of Glamorgan Council for support and guidance in October 2022 as soon as a deficit budget was projected. The new student support and wellbeing centre has contributed significantly to this deficit and this was exacerbated by other inflationary cost pressures and grant reductions through the year. Stanwell School has produced a three-year recovery plan and moved forward with voluntary redundancy and restructuring processes which have been ongoing since January 2023 involving all staff and governors.”
The letter adds: “An avenue currently being explored is working more closely again with the Vale of Glamorgan Council local authority which will reduce costs of service level agreements and allow access to funding opportunities that other community schools in the Vale of Glamorgan have benefited from.”
The Vale of Glamorgan Council said the auditors’ findings suggest significant weaknesses in aspects of financial management and particularly the management of a recent capital project carried out by the school. The report states that the budget set for 2022-23 was unrealistic in some areas and did not base the figures on realistic or historic spending levels.
“While an overspend estimated to be £283,846 on a large capital project had a significant impact on the annual budget there were seven weaknesses in the school’s financial arrangements that were rated as being high-ris," the spokesman said. “A report of this nature is very rare. There are no other schools in the Vale of Glamorgan in a similar position. Stanwell School is a foundation school. As such it is owned by the governing body and is subject to limited local authority control.
“The school did not previously access the financial support service available from the council, which provides budgeting and financial advice throughout the year. However since the emergency payment was made in March the school has taken up this service and the council has been working closely with the governors and senior leadership team to support them in putting adequate financial governance arrangements in place. A discussion has also begun about the potential for the school to move away from its foundation status.
“All of the recommendations made by the internal audit service have been accepted by the school and will be monitored. In addition a follow-up audit will take place in the autumn to ensure progress has been made.”
School deputy head teacher Sarah Owen confirmed the deficit was £588,165 and added: "The voluntary redundancies/early retirement are seven teaching staff and 10 non-teaching staff. The school has been working with the local authority on the voluntary redundancy process which is now completed and will ensure that the school's three-year recovery plan is successful."
The letter from Stanwell to parents:
“Stanwell School approached the Vale of Glamorgan Council for support and guidance in October 2022 as soon as a deficit budget was projected. The new student support and wellbeing centre has contributed significantly to this deficit and this was exacerbated by other inflationary cost pressures and grant reductions through the year.
“Stanwell School has produced a three-year recovery plan and moved forward with voluntary redundancy and restructuring processes which have been ongoing since January 2023 involving all staff and governors. Stanwell School staff and governors will continue to work closely with Vale of Glamorgan Council to ensure that the best outcomes for Stanwell pupils’ education are achieved and are grateful for the support given to date.
“An avenue currently being explored is working more closely again with the Vale of Glamorgan Council local authority which will reduce costs of service level agreements and allow access to funding opportunities that other community schools in the Vale of Glamorgan have benefited from. A full consultation will go out to all parents and carers and stakeholders around this in the autumn term 2023.”
