GAG pooling - A write up of our budgeting webinar for Multi Academy Trusts
As part of the SBS Coffee Club, we recently hosted a Multi Academy Trust (MAT) budgeting webinar on GAG pooling which was fantastic to see so many of you on! We wanted to share some of our key takeaways from this topic for those who couldn’t make this session.
What is GAG pooling?
A Multi Academy Trust (MAT) is one financial entity and the Academy Trust Handbook states that Trusts can amalgamate General Annual Grant (GAG) for its academies to form one central fund, which is either redistributed or retained separately. It is an alternative to the ‘top slice’ approach that many Trusts currently operate.
Advantages of GAG pooling:
- Enables Trusts to redistribute funds more evenly across its academies
- Trusts can allocate additional funding to schools who need to improve or are growing
- Trusts can allocate additional funding to schools that require investment in facilities or premises
- If a Trust operates in several Local Authority areas, GAG pooling can smooth out the disparities in funding calculations
- Trusts can retain funding centrally for Trust level projects and initiatives.
- Headteachers can focus on the elements of the budget that they can control, such as curriculum costs, if operational budgets for central services are managed centrally
Potential Barriers to GAG pooling:
- A shift in culture and mindset to thinking as a Trust rather than a school is necessary
- Leaders need to be on board with the idea that they are collectively responsible for all the students in the Trust and for standards across all schools in the Trust
- Some school leaders may think it is unfair that funding is allocated to students of a particular school and used for those in another school
- School leaders may be concerned that they will lose autonomy or the individual characteristics of their school
- There are perceived winners and losers if reserves are pooled and some have more than others or annual surpluses are uneven
- If the Trust is planning to grow and reserves are pooled, others may be put off from joining
Implementation of GAG pooling:
A transparent and fair GAG Pooling policy that documents the agreed criteria for allocating funds is essential and it must also include details of an appeals process to be followed if an academy in the Trust feels they have been unfairly treated.
In setting the policy the Trust will need to consider which funds are to be pooled and how they will be redistributed as well as issues such as how the individual circumstances of each academy will be taken into consideration, whether schools will be able to access additional funds during the year and how funding will be allocated to Trust projects.
A GAG pooling approach supports the central provision of services such as ICT, estates and finance and there should be a Service Level Agreement that is clear about what will be delivered by the central team to its academies.
GAG pooling in SBS Budgets
If you would like to discuss how GAG pooling would be enabled with your SBS Budgets planner, please contact the service desk on 0345 222 1551, option 8 or email sbsonline@schoolbusinessservices.co.uk
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