WREXHAM schools could be slipping into a cycle of debt they cannot escape from.
That was the concern raised by Cllr Marc Jones at Wrexham County Borough Council’s Executive Board meeting on Tuesday.
The member for Grosvenor, leader of the Plaid Cymru group, raised the issue during a debate on the final budget outturn report for 2024/25.
The report confirmed that 16 schools had applied for a licensed deficit having been unable to stay within their budget for the year – two more than the previous year.
Schools applying for a licensed deficit – a sort of overdraft facility for schools – must show how they will repay the deficit within three years. Often this means making savings by reducing staff.
But Cllr Jones said that schools were down to the bare bones.
“I think we’re reaching a point now where schools are saying ‘we can’t cut any more’,” he said.
“There’s no realistic prospect of them making up those deficits unless the (Welsh Government) settlement changes drastically.
“But we are – on paper at least – expecting schools to make good those deficits. At what stage do we say ‘this school can’t carry on’ or ‘this school can’t balance its budget’? What happens then?”
It was a point reinforced by Ruabon Cllr Dana Davies. The leader of the Labour group highlighted the fact that the annual pot of money provided by the council to fund school staff redundancies – the primary way for schools to save money – was currently £200,000. Last year the council had to approve an in-year increase as redundancy costs came to £403,976.
“Schools recognise pupil numbers are reducing,” she said. “They are going through a process of staff reductions. If that pot isn’t increased to cover redundancy and pension costs – which are front-ended – then by default you are putting schools into licensed deficit.
“One teaching assistant and one teacher could be a redundancy cost of £60-£70,000. If that pot is not increased then schools are liable to pay redundancy out of school budget.”
Chief Officer for Finance Richard Weigh acknowledged the challenges facing schools in trying to balance their budgets and said the council would review those to see if additional support was needed.
“We take the point as per the schools’ position and the potential costs around changes,” he said. “I would say that schools budget plans were due for submission at the end of May.
“We need to do as we did last year and work closely with schools to understand the impact of a range of different outcomes before those costs are finalised.”
Leader of the council, Cllr Mark Pritchard, said he held out hope that a spending review by the UK Government would bring additional funding for Wrexham schools to ease the pressure.
“There’s a spending review taking place and there has been an announcement there will be some extra money for education,”he said.
“That will come across from Westminster into Cardiff and we will see what that will be in September or October. All I would say on that is that I hope we have our fair share and that will help education.”
Overall Wrexham County Borough Council finished 2024/25 having overspent by £1,773,803. The Executive Board agreed to balance the books by using its reserves.
