The Rising Costs Facing Schools in April 2025

How to Prepare for the Financial Challenge Ahead

Schools in England and Wales are facing a series of financial pressures, with costs set to rise from April 1st, 2025. From increased staff expenses to higher infrastructure and SEND funding demands, school leaders must carefully plan their budgets to maintain financial stability.

With many essential costs rising and suppliers likely to increase their prices too, financial planning has never been more crucial. In this blog, we’ll explore what is changing, what schools should consider budgeting for, and how SBS Financial Planner can support Multi-Academy Trusts and individual schools in managing these costs effectively.

What costs will be rising from April 1st, 2025?

• National Minimum Wage Increase – The national minimum wage is set to rise by 6.7% for workers aged 21 and over, impacting the salaries of lower-paid school staff.
• Employer National Insurance Contributions – Schools will also face an increase of 1.2 percentage points in employer NI contributions. While the government has promised targeted funding to offset this rise, this is believed to fall short of the increase.

2. Special Educational Needs and Disabilities (SEND) Funding

• The government has allocated an additional £1 billion towards high-needs funding within an overall £2.3 billion increase for schools. However, demand for SEND services continues to grow, and costs associated with Education and Health Care Plans (EHCP) and special school placements remain a significant concern.

3. Infrastructure and Maintenance

• Schools will benefit from £1.4 billion for the School Rebuilding Programme and £2.1 billion for building maintenance. While this funding helps support infrastructure, many schools may still need to allocate additional resources for repairs and unexpected maintenance costs.

4. Early Years Provision

• An extra £1.8 billion has been dedicated to early years education, supporting the expansion of funded childcare hours. Schools with nurseries should consider additional staffing and resource costs to meet these new requirements.

5. Potential Supplier Price Increases

• With rising inflation and increasing operational costs, suppliers of key school services—such as utilities, IT support, and learning resources—may also raise their prices. Schools should be proactive in reviewing supplier contracts and negotiating long-term agreements where possible to lock in lower rates.

Budgeting for 2025/26 - What Schools and Trust's Should Consider 

With so many cost increases on the horizon, school leaders should focus on the following budgeting strategies:

✔ Plan for Staff Cost Increases – Consider the impact of wage increases and National Insurance changes on your long-term staffing strategy.

✔ Review SEND Spending – Ensure high-needs funding is allocated efficiently to meet growing demand.

✔ Assess Infrastructure Needs – Identify essential maintenance and prioritise investment in critical repairs.

✔ Negotiate with Suppliers – Where possible, secure long-term contracts to mitigate rising costs.

✔ Scenario Planning – Use financial forecasting to model different cost scenarios and assess the impact on your school or MAT’s budget.

How SBS Financial Planner Can Help

Effective financial planning is key to navigating these rising costs. SBS Financial Planner provides schools and MATs with the tools they need to manage budgets efficiently and plan for future expenditure.

✅ Scenario Analysis – Model different budget scenarios to understand the impact of cost increases.

✅ Centralised Budgeting – Manage settings across multiple school sites for consistency and efficiency.

✅ Payroll Reconciliation – Keep track of staffing costs and monitor how wage changes affect overall budgets.

✅ Pull Through Commitments – Sync actuals and commitments from integrated financial systems to provide an accurate financial picture.

With a powerful and user-friendly platform, SBS Financial Planner enables school finance leaders to take control of their budgets and make informed decisions that ensure financial sustainability.

April 2025 will bring a wave of financial challenges for schools, but with the right planning and budgeting tools, schools can manage these pressures effectively. By preparing now and leveraging solutions like SBS Financial Planner, school leaders can ensure they stay ahead of rising costs and continue delivering high-quality education.

For more insights into school financial planning, or to book a demo of SBS Financial Planner, get in touch with our team today!

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