(For discussion and agreement - vote)
· DW to provide details
Minutes:
· For discussion and agreement - vote
DW outlined that Bitterne Park School have applied to SCC for a loan of £450K to pay for their all-weather pitch. DW stated that legally this has to be run past the schools forum. The school has applied for £450K loan although the council will still need to agree to this. JD advised this is money the council would loan to the school but would not come from the schools block. This would be at no risk to School Block Funding. CG stated that the limit for loans to schools of up to £200K has been around a long time and is stated in scheme for funding schools. DW confirmed that anything above £200K would have to come to schools forum. This amount may be reviewed at a later stage.
DW confirmed that this loan was to come directly from the Local Authority. This would be a 5 year loan possibly at a commercial rate of interest. In response to MS and SP queries regarding Bitterne Park School’s deficit, DW explained that the school is currently in deficit, but it is a manageable deficit and the council are working with the school to provide a Deficit Recovery plan.
DW clarified when questioned regarding the high needs deficit, that it is a different funding stream. RH raised a concern that if a school gets into trouble and then comes for a loan, it sets a poor precedent for the future. RW reflected that they were funded for growth funding for extra children, seems odd that they need this. DW stated due to a design flaw in the original planning, the school needed to put in an all-weather pitch as there was nowhere for the children to play. MS added the school knew they were going to lose space. HK considered that the all-weather pitch will generate some new revenue from lettings which could be used towards the repayment of the loan.
DW confirmed that the current leadership were not involved in the expansion of the school which did not provide for an all-weather pitch. The sugar tax would not cover the cost of the pitch. The school acted under the impression the council were going to provide a loan. The loan application was however rejected and the pitch was built without a formally agreed loan agreement in place. The new loan request is for a repayment period over 5 years. DW stated that SCC are trying to maintain transparency by highlighting the issue and requesting the forum’s approval to go to the council regarding the loan. NP stated that this is a one off request from the school and not expected to be repeated for other schools. DW confirmed that the school has asked the council for a loan to cover what has already been spent.
CG supported the Local Authority and the need for the forum’s approval to recoup costs from the school. MS stated that it sets a dangerous precedent. DW explained that these were a specific set of circumstance that led to this situation and lessons have been learnt. DW reassured that the learning has happened and we will not be in this situation again.
There were further discussions around paying back the loan through renting out the all-weather pitch and the consequences if the Local Authority did not grant the loan. DW responded by saying that the Local Authority will investigate other means of getting the money back.
JD welcomed the Local Authority’s transparency and holding the school accountable and reiterated that it is a loan and not a gift. When asked what would happen to the loan if the school was to become an academy NP responded by saying the loan would be passed to the academy. HK confirmed that this is a loan, the Local Authority are not going to fund this.
JR raised the issue that the leadership of the school will shortly change again and this also needs to be considered as it is the biggest school in the city. HK stated that if the loan is rejected by the forum, the Local Authority would work with the school to identify alternative options for repayment. By doing this Schools Forum are setting a precedent. MS thought that as leaders we have to take responsibilities for decisions made.
RH sought assurance that the school have built into their financial plan the repayment of this money and DW confirmed that it has. DW confirmed that this is only the first step and the Schools Forum are not making the final decision.
ACTION: DW stated that SCC will look at the size of loans schools can apply for and review the £200K threshold before it is taken to the Schools Forum for approval.
Vote
Maintained/mainstream schools representatives only (primary vote)
Favour
6
Against
1
Abstain
2
All other representatives (secondary vote)
Favour
2
Against
0
Abstains
2
The vote was carried.