Introduction

The Funding Agency for Schools' Purpose Statement in the 1996­99 Corporate plan is:

To carry out our functions as efficiently and effectively as we can and, while meeting all the requirements of our accountability to the Secretary of State, enable GM schools to flourish, to develop long-term plans with confidence and to optimise their freedoms to meet the needs of parents and children and to produce the best possible educational outcomes.'

This will be reviewed as a consequence of the Government's proposed legislative changes.

The Funding Agency for Schools was established on 1 April 1994, under Section 3 of the Education Act 1993. The statutory functions of the Agency are to calculate and pay grants to grant-maintained (GM) schools, to monitor their financial position, to administer a borrowing regime for GM schools and to ensure that there is an adequate number of school places in certain Local Education Authority (LEA) areas. In addition, the Agency offers support and advice to GM schools on special measures or with serious weaknesses.

The Board currently comprises fifteen members appointed by the Secretary of State. The Agency is divided into four directorates Finance, Planning, the Board Secretariat and Personnel and Services.

Achievements in 1996/97

The Agency has achieved a significantly better performance than the targets set for the notification of grant amounts to schools. A major piece of research has been undertaken and published on a National Funding Formula for schools in response to a Government White Paper. Around 8,000 school places have been allocated to the GM sector to meet projected basic need. The Agency has proposed, designed and built two new schools, one of which was opened in April. Following legislation, the Agency is administering a new regime which allows schools to borrow commercially to allow increased capital investment. The Agency's financial monitoring work has improved the financial stability of the sector as a whole and a document Guidance to External Auditors has been published.

Good practice guides have been issued on Estate Management and Managing Maternity Leave and a first set of reports on Cost Comparisons for GM schools have been issued. A report Planning Secondary School Places in London has been issued to all interested parties in London. The Agency has developed its approach to working with schools requiring special measures or with serious weaknesses following an adverse OFSTED inspection.

The Agency is providing guidance to GM schools to allow them to make use of the Private Finance Initiative to maximise capital investment. Seven pathfinder projects are currently in progress and a number of follow up projects are now being identified.

The Agency is currently working towards IiP and aims to complete the process later in the year.

Plans for 1997/98

The Agency plans to:

• continue to develop systems to help schools to gain access to funding from a combination of sources for capital investment purposes;

• £9 million is being made available to support improvements in school security;

• publish plans for the addition or removal of school places in those areas where the Agency has sole or joint school place planning responsibility (Stage 2 and 3 areas);

• continue to work with the small number of GM schools that are in difficulty or require special measures;

• assist all GM schools in developing targets and performance measures;

• publish value-for-money studies, including two on Management Information Systems and Cost Effective Sixth Forms;

• publish further Costs Comparisons reports annually;

• undertake value-for-money studies on working with employment law, energy and water efficiency and the use of support staff;

• develop the Agency's information resource for access by schools and policy makers; and

• carry out a further review of the quality of GM schools' external audits.

Key Performance Targets
	1995/96		1996/97		1997/98
Key Measure	Set	Achieved	Set	Achieved	Set
Determine and notify schools of Annual Maintenance Grant accurately and promptly by: a) 30 April b) within six months	90 99	98.9 100	90 99	95.3 100	92 99 (4 months)
Pay all grants accurately and promptly in accordance with the timescales notified to schools	95	99.6	95	98	95
Review the range of Special Purpose Grants and notify schools by	28/2/96	12/2/96	28/2/97	18/12/96	28/2/98
Disseminate timely information to schools about the Agency's capital approach, as a result of the PES settlement by	31/1/96	28/1/96	31/1/97	18/12/96	31/1/98
Achieve efficiency savings in Agency costs per number of GM schools (%)	4	4.2	4	7.3	4
Respond to all GM schools proposals in Stage 2 and 3 areas within	2 months	1 month	2 months	1 month	2 months