Tag Archives: saving money on purchasing

Can state services save money for schools?

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When I first started writing this blog, back in early 2013, now nearly a decade ago, one of my mistakes was not to create an index. With more than 1,300 posts later, to do so now would be a labour of love that at present I don’t have the time for. The lack of an index means I am largely dependent upon visitors throwing up links to former posts to supplement my own memory of issues such as Jacob’s Law – discussed in the previous post.

Today, I have been reminded of a post from January 2018 about costs and savings in the education system that is relevant to the present economic situation. You can read the full post at Not Full Circle? | John Howson (wordpress.com) but one key paragraph was this:

“…. I wonder whether another stage in the cycle of government contracting is starting to emerge. In the immediate post-war period of central planning, public bodies often ran most services. There was no profit element to consider, but cost controls were of variable quality. The Thatcher era saw a mass transfer of services to private companies, with an expectation that costs would fall. Maybe some did, but others didn’t and some benefitted from the proceeds of technological change that drove down costs, but didn’t create competition and didn’t always drive down prices.”

This 2018 post had built upon an even earlier one from July 2014 Private or public | John Howson (wordpress.com) that dealt with the issue, concerning even then, of the cost of outsourcing children’s services to the private sector with no control over rising costs.

At that time, I was establishing TeachVac www.teachvac. To demonstrate how costs of recruitment advertising could be reduced. I concluded the post with the comment that;

“In a time of cutbacks on government expenditure, as we have witnessed during the past six years, it is inevitable that staffing costs will come under pressure, and the debate between cutting wages or cutting services will rage. Sometimes there is a third way, and a new technology or a different approach, can achieve the same service level for lower costs. Is that what we ought to be striving for in education? The only other alternative to preserve service levels is higher taxes.”

This debate about the profit element, and where the most cost-effective system can be found, is once again a live one as the country faces a new round of coping with living beyond its means and the consequences of a foolish attempt to ‘dash for growth’ when other global factors were pointing towards the need for sound government.

How to make savings in a devolved system such as schooling in England is an interesting question. Perhaps we should start with the role of the DfE. Is it there to provide services on a ‘take it or leave it’ basis, such as their vacancy site or is it there to bring together the different players to work out the best value approach for schools. If the latter, how does it enforce such a best value approach? Perhaps the annual audit report should make a comment to governors about where a school spending exceeds a benchmark?

TeachVac is currently in the process of creating an index on recruitment showing the position that a school sits both locally and nationally. Such an index would provide evidence to show the degree high spending on recruitment was necessary and justified.  

Dear Prime Minister

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Would you like some good news? On your return from Birmingham, you will no doubt be asking Ministers how their departments can save money. Here is one suggestion. I am not unbiased in making this suggestion, as it could benefit TeachVac, the job board that I chair. However, TeachVac was in existence before the DfE started its own version and has consistently shown how to achieve a low-cost approach to vacancy listing as our accounts at Companies House will confirm. Reviewing the DfE site could also save the government money.

We suggested originally that the DfE need only provide a page pointing those seeking teaching posts to available sites in the private sector, and another for schools showing the relative costs of using different sites. However, in response to the Public Accounts Committee, the DfE decided on a more costly intervention and created its own job board.

TeachVac is currently offering secondary schools a deal of 12 months of unlimited matches for just £250 and a mere £50 for primary schools. How much per vacancy does the DfE cost to provide?

Reproduced below is a post from 2020 that further makes the case for saving money on the DfE’s job board. Our monitoring since then suggests that the DfE site has gained little traction in the market and may be losing ground in terms of teaching vacancies uploaded.

DfE and Teacher Vacancies: Part Two

Posted on April 3, 2021

The DfE is spending more money supporting their latest venture into the teacher recruitment market. SchoolsWeek has uncovered the latest moves by the government to challenge existing players in this market https://schoolsweek.co.uk/dfe-leans-on-mats-to-boost-teacher-job-vacancies-website-take-up/ in an exclusive report.

The current DfE foray into the recruitment market follows the failure of the Fast Track Scheme of two decades ago and the Schools Recruitment Service that fizzled out a decade ago. The present attempt also came on the heels of the fiasco around a scheme to offer jobs in challenging schools in the north of England that never progressed beyond the trial phase.

The present DfE site rolled out nationally two years ago this month. How successful it has been was the subject of a SchoolsWeek article earlier this year. https://schoolsweek.co.uk/dfes-teacher-job-website-carries-only-half-of-available-positions/  This blog reviewed the market for vacancy sites for teachers last December, in a post entitled Teacher Vacancy Platforms: Pros and Cons that was posted on December 7, 2020.

In that December post, I looked at the three key sites for teacher vacancies in England. TeachVac; the DfE Vacancy site and the TES. As I pointed out, this was not an unbiased look, because I am Chair of the company that owns TeachVac. Indeed, I said, it might be regarded as an advertisement, and warned readers to treat it in that way.

There is an issue with how much schools spend on recruitment of teachers. After all, that was why TeachVac was established eight years ago. The DfE put the figure in their evidence to the STRB this year at around £75 million; a not insubstantial figure.

Will TeachVac be squeezed out in a war between the DfE backed by unlimited government funding and the TES with a big American backer? At the rate TeachVac is currently adding new users, I don’t think so. After all, the DfE site doesn’t cover independent schools, and in the present market I believe that most teachers want a site that allows access to all teaching jobs and not just some. That benefits both TeachVac and the TES as well as other players in the market, such as The Guardian and SchoolsWeek, as well as recruitment agencies.

How much the DfE will need to spend on ensuring they cover the whole of the state-funded job market in terms of acquiring vacancies by the ‘school entering vacancies’ method is another interesting question? As is, how much will it also cost to drive teachers to using the DfE site and not TeachVac or the TES?

A view of TeachVac’s account reveals that TeachVac provides access to more jobs for teachers at less than the DfE is going to spend on promoting their site over the next few months. Such spending only makes good commercial sense if you want to remove a player from the market.

So, here’s a solution. Hire TeachVac to promote the DfE site and use the data TeachVac already generates to monitor the working of the labour market. After all, that was also one of the suggestions from the Public Accounts Committee Report that spurred the DfE into action and the creation of their present attempt at running a vacancy site.

Buddy, can you spare a dime?

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Did schools really save money in the five-year period up to 2019-2020? The DfE has published a study showing the aim of ‘saving’ at least one billion pounds during that period was achieved. Progress in schools savings and resource management – GOV.UK (www.gov.uk)

The methodology of the study was to measure savings as the difference between actual non-staff expenditure in 2019-20 and what was estimated non-staff expenditure would have been in 2019-20 if schools had not changed their spending behaviour. This is expressed as the difference between the expenditure line and the counterfactual line as to where expenditure without saving would have been.

It is worth noting that the period covered was one where primary school rolls were generally on the increase, and for many secondary school rolls were either constant or falling. Academies and maintained schools also operate on different financial years, so that could be an additional complicating factor.

A significant proportion of the saving came in the final year 2019-2020. I am not sure whether that meant that the final third of that financial year for academies covered the first four months of the pandemic when, for instance, there would have been a significant drop in expenditure on school meals, as most children were forced to stay at home.

The target of £1 Billion pounds was set after the National Audit Office (NAO) report “Financial sustainability of schools” published in 2016 identified that schools would incur cost pressures of £3bn between then and 2019- 20. The DfE then produced analysis which compared schools with different levels of spending but similar pupil characteristics and levels of attainment.

According to the report,

 ‘the DfE estimated the impact of bringing the spending of the top 25% highest per-pupil non-staff spending schools down to the level of those at the 75th percentile. This analysis indicated that, schools could plausibly save around £1 bn on their non-staff spending and so this became the ambition of the SRM portfolio’ (Page 3)

It is not clear from the report whether that is what happened, or whether the schools better at managing their costs took more out of the system, thus widening the gap between those schools good at achieving savings and the rest of the sector. Since both primary and secondary schools were included, it would have been interesting to know how much of the saving was due to fixed costs that don’t alter with changing pupil numbers – it presumably cost a similar amount to heat and light a school even if pupil numbers fluctuate. The saving would be more impressive and longer-lasting if it was the variable costs that had been reduced. Primary schools often have higher fixed costs as a proportion of income, although many of these are staff costs.  

And, as the DfE note in the definitions on page 5 of the report.

‘“Saving” in this context does not mean a cash saving. We measure savings by comparing actual non-staff spend to where we expected non-staff spending to be had schools not changed spending behaviour – the counterfactual. We would calculate cash savings by taking away actual non-staff spend in 2019-20 from actual non-staff spending in 2015-16.’

And finally, it looks as if the special school sector was excluded if the study was only on primary and secondary schools. It would be interesting to know about cost pressures in that sector and whether similar saving was possible?

Teacher Vacancy Platforms: Pros and Cons

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In this post, I look at the three key sites for teacher vacancies in England. TeachVac; the DfE Vacancy site and The TES. Now this is not an unbiased look, because I am Chair of the company that owns TeachVac. Indeed, it might be regarded as an advertisement, so treat it in that way if you read on.

TeachVac is in the process of filing its accounts for the year to June 2020 with Companies House. The DfE doesn’t file accounts, and the TES has filed accounts up to the end of August 2019, with a forward comment about the possible effects of the covid pandemic in the year to August 2020.

All three sites cost teachers nothing to use during the last year. However, the DfE site only offers vacancies in state schools, and only a proportion of those schools. TeachVac estimates that in 2020 the DfE proportion of vacancies for teaching posts never rose above 40% of the vacancies open to teachers across both state and private schools. So, the DfE is worthwhile if you only want a job in a state-funded school. Both TeachVac and the TES offer vacancies in state and private schools, although TeachVac doesn’t cover all private schools with pupils below the age of eleven. The TES coverage depends upon those prepared to pay to advertise vacancies on their platform.

Both TeachVac and the DfE site have no direct financial cost to schools. However, the DfE site does require schools to input vacancies into the site. This is optional for TeachVac, and most schools are happy to rely upon the automatic vacancy collection process operated by TeachVac. The TES has a number of options, all require schools to pay for their vacancies to appear on the TES job site and be matched with teachers.

TeachVac also offers users a monthly newsletter on the state of the market for teachers.

The operating cost for TeachVac in 2019/20 was just £1.10 per vacancy processed. Neither the DfE nor The TES publishes a similar figure, but the TES accounts would suggest their cost per vacancy is much higher than that of TeachVac. To find out the cost of the DfE site would need a parliamentary question.

So, are teacher associations, governors and school business managers and those responsible for local authorities, diocese and MATs recommending TeachVac as the most cost effective means of displaying and matching vacancies? Of course not.

Are they recommending teachers to use Teachvac, some are, others aren’t. Course leaders preparing teachers are now recommending TeachVac as a place for trainees to look for their first vacancy. Those trainees are sticking with TeachVac to find subsequent jobs and promotion opportunities.

I am proud of the achievements of the TeachVac team in driving down costs of vacancy advertising. Next the team will start to look at other parts of the recruitment journey to see if there are saving to be made in other areas as well.

Incidentally, if anyone wants to sponsor the TeachVac site, my investors are always open to discussions.

Bulk buying back in vogue

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When I was a young teacher in London there was a large central buying organisation for schools, called something like Greater London Supplies. I recall that they had a big depot at Tottenham Hale in north London. Purchasing basic supplies on behalf of large numbers of schools made good business sense, even to the most socialist of Labour councils. However, it didn’t make sense to the Thatcher government that believed market competition at a school level was the way forward.

Reading the DfE’s recent announcement on procurement and helping schools with costs, suggests that this is yet another move back in the direction of levering the purchasing power of schools as a combined unit, rather than expecting them to operate as individual business sites. How long will it be before Ofsted is asked to include in their inspection report whether a school is making full use effective purchasing decisions to target as much cash as possible on teaching and learning?

TeachVac, the free vacancy site for schools and teachers, www.teachvac.co.uk  where I am chair of the board, doesn’t yet feature in the DfE list. I am sure that they will find a good reason not to list it, as they don’t yet list any vacancy advertising services, whether they are either paid for services like all the others or free like TeachVac and their own nascent service. Maybe they don’t want competition?

The government’s actions in driving down costs aren’t completely risk free. After all, if prices are driven down too far then suppliers will exit the market and leave just one monopoly provider. At that point, it becomes an issue as to whether the State should regulate the provision of the service or actually take over the running.

As I have suggested in previous posts on this topic, once prices have been reduced by increasing efficiency then it can become very difficult to make a profit. Then there is also the reason why local decision-making was favoured by many: the speed of service delivery. A central maintenance contract may be cheaper, but what is the true cost of waiting several days for a window to be replaced or a leaking toilet mended?

I am sure that there is a unit within the DfE thinking of other areas where schools can either save money or increase their incomes without putting more pressure on parents. They might want to ensure deals there are good deals on school uniforms and sports kit and make schools explain why they are requiring a uniform that is more expensive than the average. Tradition, would not be a good enough answer.

My own suggestion for research is, as mentioned before, school playgrounds. They must be the least used piece of real estate in the country. I don’t suggest they are done away with, as when needed they perform a vital function, but what can we do with them for the other 99% of the year? More all-weather community pitches; a source of generating renewable energy; even vegetable growing spaces areas with a playground on top.

We are spending millions on research into driverless cars; how about a couple of million for more effective playground spaces?