Heads threaten total shutdown

Observations on the schools budget crisis

The schools budget crisis has suddenly turned into a bomb, ticking loudly under the Education Secretary, Charles Clarke, and timed to explode in January. Eleven schools in Barnet, north London, have set illegal deficit budgets. On the money allocated to them, their only alternative would involve getting rid of 75 teachers between them. So the money intended to see them through until April will run out in January. When it does, they will no longer be able to pay their teachers, and the schools will close.

"The government is telling us to wreck our schools, and we are not prepared to do that," says Nick Christou, head of East Barnet School. "By January we will run out of money. I do not think the staff will go on teaching when we cannot pay them. The schools will close."

Clarke has wriggled desperately. He has tried to blame local councils, but the crisis was caused by the government. He has offered to allow schools to spend their capital on keeping teachers, but this frees up only a fraction of the sums needed.

In January he will have very few options, none of them enticing. He can take over the running of the schools, and take the blame for their inevitable rapid decline from successful and well-run schools (most of the schools get good results and have been praised by Ofsted) into sink schools. He can force the local council to take over the running of the schools, and try to ensure that it takes the blame for the decline.

He can take the school governors to court, and ensure they are personally surcharged for setting an illegal budget, in the same way that Lambeth councillors were surcharged by the Thatcher government in Ted Knight's day. But it was easy for that government to demonise the Lambeth councillors as a gang of Trots. It will be much harder with the Barnet governors.

This is a confrontation that the schools could lose but Clarke cannot win. For the eight secondary and three primary schools, it is a high-risk strategy, but they argue that the alternatives were even worse. They have already tried to compromise. They cut back their staffing by more than 30 teachers between them. They have cut back drastically on support staff, even though this has entailed quietly forgetting government promises that teachers would be freed from much of their administrative work.

If they cut staffing any further, the schools would decline sharply now. At least, by setting deficit budgets, they have bought time for the government to find a way of solving the problem.

Can Clarke use the six months he now has to avoid going down in history as the education secretary who wrecked Britain's schools? One option might be for him to tell the council to underwrite each school's budget deficit. This goes against all previous instructions to local councils, but it might have the attrac- tion of forcing the council to clear up the government's mess, and putting ministers in a position to blame the council for the inevitable council tax rises and financial problems which will follow.

The right solution is for the govern-ment to admit that it got its sums wrong, and stump up the money. But governments are not good at admitting that they were wrong.

Clarke does not have a friendly relationship with Gordon Brown, the Chancellor, and he may have gone too far down the road of blaming everyone else to be able to draw back now.