Key Takeaways
- Auditors have identified issues with schools’ spending, including personal travel and entertainment expenses
- 27 schools required Ministry of Education guarantees for their finances, four times as many as the previous year
- Many schools failed to plan ahead for building maintenance, with 51 schools lacking sufficient evidence of maintenance plans
- Some schools broke the law, including borrowing too much money and entering into contracts with board members without approval
- The Ministry of Education is developing new guidance and criteria for spending on professional coaching and well-being support
Introduction to the Auditor-General’s Report
The auditor-general’s annual report on schools’ 2024 accounts has highlighted significant concerns regarding the financial management of schools in New Zealand. The report reveals that more schools than the previous year are struggling financially or spending money inappropriately, with many failing to plan ahead for building maintenance. The auditor-general’s office has identified a range of issues, including personal travel and entertainment expenses, lack of documentation, and breaches of legislation. In this article, we will examine the key findings of the report and the implications for schools and the Ministry of Education.
Financial Management Issues
The report notes that 27 schools required Ministry of Education guarantees for their finances, which is approximately four times as many as the previous year. This suggests that a significant number of schools are experiencing financial difficulties, which may be due to a range of factors, including declining enrollment, increasing costs, or poor financial management. Furthermore, the report highlights instances of schools spending money inappropriately, including on personal travel and entertainment. For example, Glenview School in Hamilton spent $29,458 on trips to Canada, Vietnam, and Samoa, but did not provide sufficient evidence that all the spending had a clear business purpose. Similarly, Fairfield College in Hamilton paid $17,155 for its principal to travel to Alaska and Canada, but there was not enough evidence that all the spending had a clear business purpose.
Lack of Documentation and Transparency
The report also notes that some schools failed to provide adequate documentation to support their financial statements. For example, the combined board of Te Kura Kaupapa Māori o Manurewa and Te Wharekura Manurewa did not retain accounting records and relevant supporting documents, making it impossible for auditors to give an opinion on their accounts. This lack of transparency and accountability is a significant concern, as it suggests that some schools may be hiding inappropriate or unauthorized spending. The report also highlights instances of schools failing to keep adequate records of community-raised funds or sports fees, which can lead to a lack of accountability and transparency.
Breaches of Legislation
The report notes that some schools breached legislation, including borrowing more money than they were allowed to and entering into contracts with board members without the secretary for education’s approval. For example, two schools met the costs of an international student through a scholarship, despite legislation requiring schools to charge fees that at least covered the costs of tuition and capital facilities. These breaches of legislation are significant, as they can have serious consequences for schools and the students they serve. The Ministry of Education must take action to ensure that schools are complying with relevant legislation and regulations.
Building Maintenance and Planning
The report also highlights concerns regarding building maintenance and planning. Many schools failed to provide sufficient evidence of their plans for ongoing maintenance of their buildings, which can lead to significant costs and disruptions in the future. For example, 51 schools did not provide enough evidence about their plans for ongoing maintenance, which is a significant concern given the age and condition of many school buildings. The Ministry of Education must work with schools to develop effective maintenance plans and ensure that schools have the resources and support they need to maintain their buildings.
Conclusion and Recommendations
In conclusion, the auditor-general’s report highlights significant concerns regarding the financial management of schools in New Zealand. The report identifies a range of issues, including personal travel and entertainment expenses, lack of documentation, and breaches of legislation. To address these concerns, the Ministry of Education must take action to provide guidance and support to schools, including developing new guidance and criteria for spending on professional coaching and well-being support. Schools must also take responsibility for their financial management, including providing adequate documentation and transparency, and ensuring that they are complying with relevant legislation and regulations. By working together, we can ensure that schools are using their resources effectively and efficiently to support the education and well-being of students.
