National President, New Zealand Principals’ Federation
The aftermath of Novopay will take years to forget. One of its lessons for all sectors must be the management by schools and the Ministry of Education, of banked staffing. Banked staffing was introduced to the sector by Trevor Mallard in 2001, to provide the flexibility of bulk funding, without the political issues. It didn’t take long for the sector to stumble upon its anomally of debiting relief days at 0.07, but paying the staff member at the collective agreement rate, which equated to roughly double the benefit to schools. As the news spread across the country, principals were initially incredulous, and then became experts in managing their staffing to effectively wring this double value from their relief teacher
The Novopay software’s inability to calculate accurate banked staffing reports for 2012 has led to chaos, and real risk for schools. budget. I recall being rung by a Ministry staff member who told me off for carrying a high Banked Staffing surplus. I tried manfully to explain what I was doing and why, but he truly didn’t want to hear, and hung up the phone convinced that I was inept. Not all principals “got it” of course. Thanks to Gavin Price’s efforts, the grapevine spread the news quickly and efficiently throughout the primary sector, but high schools were less receptive to engaging with the challenge. This was possibly due to their larger administrative capability, and the fact that many have full time executive officers and deputy principals, who carry that responsibility whilst remaining out of the loop. So – the banked staffing surplus benefitted some, whilst others missed out. When Novopay was being set up, the sector’s advice to Talent2 was clear. The system had to be able to pay a reliever for a day’s work, and debit banked staffing by just 0.07 FTTEs. This caused puzzled frowns, and when the software couldn’t make this work, the Novopay business rules highlighted at last the anomally. I would love to have attended the briefing of the relevant senior ministers as all was revealed. Apparently the mistake represented around $68m per annum. Multiplied over the years, this was heading towards a billion dollar miscalculation! Fortunately everyone recognised that this resource was now part of the education sector’s financial landscape, and could simply not be removed. The previously allocated banked staffing
funds are now delivered to schools in a formula driven increase to the bulk grant, although the best operators know that it doesn’t cover the advantages of the old system. Novopay delivered lessons for the Ministry, but it has also delivered important lessons for principals. The Novopay software’s inability to calculate accurate banked staffing reports for 2012 has led to chaos, and real risk for schools. The Ministry’s “fix” is that schools may manage their under- or over-use through until the end of 2013, although I remain unconvinced that this will be helpful for all. How can you manage a resource when you don’t know exactly how much the resource is worth? The lesson for principals is that all schools should be tracking their own banked staffing every fortnight throughout the year. In my school, the teacher salaries wage bill is roughly four times the value of operational funding. When you consider the checks
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and balances that are wrapped around other financial reporting it is hard to justify a failure to monitor your staffing entitlement. It is not as onerous as it sounds, and once a management system is set up it can easily be operated and managed by office staff. Use the Ministry’s banked staffing spreadsheet, and update it every fortnight with your actual staffing. This simple cashflow process grows more and more accurate as the year progresses, and allows fine tuning in the last months of the year. It doesn’t resolve the new challenges of the Novopay environment. The value that was developed to represent the true cost of employing a reliever was set for 2013 at 0.1368, instead of 0.07 fttes. This reflects the collective agreements, but now creates its own problem. If a teacher is away on LWOP, and is replaced by a reliever for five days within a pay period, the total staffing cost for that fortnight equals 1.314 FTTEs. In other words, leave without pay is now a direct cost to the school. Most leave without pay is discretionary, and in the past it was a relatively easy thing to approve as it had no material cost implications. It certainly has cost implications now, and those teachers who routinely ask for days to head off for a few weeks during the year will be highly perturbed when their request for LWOP is turned down. The single five day’s leave example above will cost schools around $650. There will of course, be increases to the cost of Leave WITH Pay as well. This is just another example of the problem of unforeseen consequences. League tables and national standards have unforeseen consequences for children that have been ignored by those who should know better, so should it come as no surprise that Novopay has a few as well.
In the lead up to Matariki on 10th June and Māori Language Week (July 1-7) NiE will be publishing four 8-page PLUS 24-PAGE mini newspapers PHOTO KIT across levels 2-5.
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