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Don’t let budgets block your digitalisation pathway by
Thu, 16th Feb 2023
FYI, this story is more than a year old

Increasing costs for the education sector does raise the question of how to manage budgets to enable schools to navigate their own digital transformation pathway. It’s become clear that digital learning is a vital component of education, and using technology in the classroom motivates and encourages students, helping them to become more self-confident and independent.

However, for it to function optimally, an educational establishment’s entire technology estate needs to be monitored, regularly refreshed and regularly replenished. That’s not just back-office infrastructure like servers but digital learning tools like interactive whiteboards and, above all, devices for teachers and students, especially if that school is striving for a policy of a 1:1 ratio of device to student. Both educators and students need to know the equipment students use in class – primarily laptops and tablets – is reliable, able to cope with the latest technology standards, and run the latest software or apps.

Tech that can’t do these things creates many problems where workarounds will need to be found to do what’s required in the classroom, and students may get the impression that their education experience is lacking.

One of the key things that the Covid 19 pandemic taught us is that there is a vast inequality in access to technology among school-age children. Schools found themselves bridging the gap, and in many cases, and for large numbers of young people, schools are still the primary provider of computing equipment. It is a vital and often sadly hidden role for them.

Making tight finances stack up

Headteachers and others with responsibility for technology acquisition in schools are all too well aware of their need to provide the best solutions for their students. They are also, though, in a situation of severe budgetary pressure, and that’s not going to change any time soon. The Department for Education spent £365m in 2021, a 208% increase from the previous year. This followed a year of staff and pupils being forced to work from home during lockdowns. This budget has to cater for 10 million pupils in over 32,000 schools across the UK’s 152 local education authorities. It has to cover everything, not just technology provisions.

Senior Leadership Teams know what they need, but that doesn’t answer the question of how to finance it, how to manage the complex procurement and auditing requirements, or how to find the money and stay compliant.

Fortunately, in the form of leasing, there is an excellent alternative to outright purchases for educators when it comes to the acquisition of classroom technology like laptops and tablets. This can translate an initial capital outlay into low quarterly, termly or annual payments, helping School Business Managers to spread the financial cost and budget over an extended period. Moreover, deferred payment terms can help educators obtain equipment earlier rather than waiting for the start of a new financial year.

Lower the cost and keep the product

There are very important additional advantages to the leasing model, which provide a much better return on investment than outright purchase at the outset whilst giving students a significant benefit too.

Using a leasing model offers better value for money than Local Government funding rates or other borrowings, as less than 90% of the equipment cost is financed with an operating lease. An Operating Lease – valid under FRS102 financial reporting – is the only type of lease agreement that state-funded schools (local authority or Academy) can enter into without prior approval from the Education and Skills Funding Agency (ESFA) on behalf of the Secretary of State.   

In education, the leasing of equipment can be supported through a Parental Contribution Scheme. These schemes enable schools to procure the latest technology on a 1:1 basis while asking parents to cover the whole, or a percentage, of the costs. The schemes work with a partner managing the procurement of the equipment, parent contributions, insurance protection and full financial reporting, taking the administrative burden off the school.

Parental Contribution Schemes can even be designed so that the students get to keep the product at the end of the lease period, which is typically 2-3 years. For the students, this may mean little difference; having had use of a laptop or tablet for the term of the lease and then having it handed to them does not have an effect on their experience as end users. But the fact that the device becomes theirs means they can continue to use it for its natural lifespan, enjoying the educational benefits this brings.

There is more to it than the product itself

The lease model is one that has been proven in the educational sector. Beyond the devices, schools need to keep track of their technology estate, both from an asset management perspective and also to manage the refresh cycle.

Individual schools often don’t have the resource to do this, and even multi-school clusters are likely to find it is financially unviable to handle in-house - and there is no need for them to spend precious budget on it. Schools should ensure any partners they work with on procuring technologies can also manage the assets throughout their lifecycle: including managing maintenance schedules, payment records, refresh cycle information and much more, to a granular level and in real-time. When a Headteacher or School Business Manager needs to report on the technology estate, the information they need is available to the highest standards for any accounting period that’s required. 

Carbon reporting and offsetting

This isn’t the only reporting that educational establishments need to do. Under the Government’s Streamlined Energy and Carbon Reporting (SECR), all schools and academies are required to report on their carbon footprint and energy consumption and provide statements on carbon offsetting. Moreover, schools are more than aware of most of the responsibilities they have to respond to the challenges around resource management and climate change, and this is why schools and trusts look for carbon-zero offerings that can offset the carbon costs of their IT assets. Not only this but in operating lease models, assets can be collected at the end of their lifecycle and remarketed for other organisations to use.

The fact that we at CHG-MERIDIAN have been doing this for over 40 years can help an educational establishment with its own stance on climate change and the reuse/recycle agenda, taking the challenge of repurposing off its hands. 

A double win – cost and efficiency savings rolled into one

It isn’t often that an organisation can truly meet its aims of cost, carbon offsetting and digital transformation with one budget decision, but that’s precisely what educational establishments can do with a lease option. The added benefit of students getting up-to-date equipment which ultimately they can get to keep, and Headteachers getting a bespoke asset management system brings so many benefits over the traditional, “old school” approach of direct purchase. It really is a win-win.