Local Management of Schools (Hansard, 24 June 1992)

§ Mr. Forth

The effects of local management of schools can be loosely attributed to the two main planks of LMS policy—formula funding and delegation.

The introduction of formula funding has meant that schools have been allocated funds according to a system that is open and equitable. Historical inequities have been revealed and are being addressed. The new openness has resulted in greater confidence and better-informed debate about relative funding needs. LMS has ensured that schools are funded mainly on the basis of their success in recruiting pupils—the more pupils they attract, the more money they get. In this way, LMS has given schools a strong incentive to be responsive to parents and rewards good schools.

Local management of schools requires the bulk of the local education authority school budget to be delegated to schools themselves, for governors to manage as they see fit. When schools receive a delegated budget, governing bodies also acquire the power to appoint and dismiss staff. LMS has therefore resulted in a marked shift of power from LEAs to schools. It has meant less money being retained and spent in county hall and more being spent in and by schools. It has meant greater flexibility for schools to manage their budget according to their own priorities.

We must remember that LMS is still in its infancy. Not all schools yet have full control of budgets allocated entirely by uncushioned formula. Transitional arrangements have however to be phased out by April 1994–1995 234W for inner London LEAs. Nevertheless, LMS has been widely welcomed by schools and there is general agreement that it has been a major positive development. That success has been due, in large part, to the dedication and hard work of governors and senior management in schools who have embraced their wider responsibilities with enthusiasm. Nor would LMS have been possible without the major contribution of LEA officers. I believe that the present popularity of LMS is well founded and I am confident that, as LMS policy matures, it will make an increasing contribution to improving standards in our schools.