Hounslow schools are facing increased financial scrutiny as the Schools Forum reviews budget proposals and considers changes to financial regulations, including a new contingency fund and adjustments to surplus balance thresholds.

The Hounslow Council Schools Forum met on Monday, 17 November 2025, to discuss school funding and financial stability. Key topics included de-delegated budgets, a consultation on the Scheme for Financing Schools, financial monitoring, and school balances. The Agenda frontsheet and Supplementary Agenda for the meeting are available online.

One of the main points of discussion was the proposal for de-delegated budgets for the 2026-27 financial year. De-delegated funds are deductions from maintained schools' budget shares, applicable only to maintained primary and secondary schools. The proposals include budgets for free school meals eligibility, staff costs supply cover for Trade Union facilities time, statutory school improvement, support services for maintained schools, and a new contingency fund to support maintained schools facing significant financial difficulties under the Hounslow Schools Financial Sustainability Programme (HSFSP).

The budget for free school meals eligibility is expected to increase from £25,700 in 2025/26 to £52,372 in 2026/27. Similarly, the budget for school improvement services is slated to rise from £308,000 in 2025/26 to £471,000 in 2026/27. A new de-delegated contingency of £203,000 is proposed for 2026/27 to support schools in financial difficulty under the Hounslow Schools Financial Sustainability Programme (HSFSP). The fund is intended to support maintained schools in financial difficulty under the HSFSP, but specific criteria for accessing the fund were not detailed in the meeting information.

The Schools Forum also discussed proposed amendments to the Scheme for Financing Schools and Schools Financial Regulations. The council intends to review and update the Scheme and Financial Regulations for Financing, with the intention to:

  • Better support and equip schools in the overall dispensation of financial and budget management responsibility
  • Improve schools' strategic financial planning of resources
  • Empower schools
  • Limit the number of schools heading to deficit budgets
  • Provide assurance to the Council

One proposed change is to bring forward the deadline for schools to submit a 3-year budget forecast each year, from mid-June to 1 May. The report pack says that schools must also submit an ICFP workbook alongside their 3-year budget, which they say will allow the council to make better financial assessments of each school's financial position. While the ICFP workbook is intended to improve financial assessments, the specific data points to be analyzed were not disclosed.

Another proposed change relates to surplus balances. Currently, school balances held in excess of 8.3% of a school's funding are considered to be excess balances. The proposal is to increase this to 10%. The rationale is to better support and equip schools in financial and budget management, improve strategic financial planning, empower schools, limit deficit budgets, and provide assurance to the Council. The council has stated that schools may hold an excess balance for up to three consecutive financial years for specific purposes, including: a revenue contribution to an agreed capital scheme, a contribution to a 'spend to save' scheme, managing costs associated with SEN, to support the costs incurred by the review of contracts of a significant value, where expenditure is not even year on year, managing the costs of expansion of pupil numbers, managing financial difficulties associated with a budget reduction in the following financial year, resulting from either a significant reduction in pupil numbers or a loss or significant reduction of a specific funding stream and managing exceptional circumstances in such a way as to avoid significant financial turbulence that may impact on standards. This may include, for example, outcomes of HR processes. The report pack states that schools who have held balances in excess of 10% of their school funding for three consecutive financial years should expect their excess balance at the end of the third consecutive financial year to be clawed back by the council.

The council is also considering developing a loan scheme for schools. Schools are able to request to apply for a loan from the council by writing to the Schools Finance Team. Loan applications will be reviewed on a case-by-case basis, as will the agreement of the loan terms and conditions. Successful loan applications will demonstrate repayment of loan within a reasonable period (3-5years) and schools compliance with the Scheme for Financing Schools and the Schools Finance Regulations. Final loan approval rests with the Executive Director of Finance & Resources.

The Schools Forum received an update on financial monitoring for 2025/26. The report pack includes a summary of the General Fund position, highlighting areas of significant overspends, including Waste and Recycling (£2.8m), Social Care Academy (£1.3m), Corporate budgets (£1.3m), Leisure service (£1.0m), and Unallocated Savings (£2.1m). The report pack also includes a summary of the Dedicated Schools Grant (DSG) projection for September 2025, which forecasts a £0.1m overspend.

The Schools Forum is scheduled to discuss school balances as of 31 March 2025, including an appeal from Bedfont Primary School.