For many years, budgeting in schools and trusts has followed a fairly traditional pattern. Leaders take last year’s figures, add or subtract a percentage, and call it a plan. This incremental approach is straightforward, but it often has little connection to what schools actually want to deliver, or alignment with school improvement priorities.
Even when leaders believe they are reflecting curriculum plans in the budget, the reality can be different. Without clear processes, integrated systems, or consistent evidence, links between the curriculum and the budget can end up scattered across different systems or simply in people’s heads. That disconnect makes it difficult to demonstrate that resources are being deployed in line with educational priorities.
At a time when financial pressures are greater than ever, sticking to old habits is unlikely to deliver the outcomes that pupils, parents, and staff expect. Balancing the books is essential, but the way we balance them matters just as much. When the process starts with pupil needs and the curriculum, trusts give themselves a far better chance of shaping budgets around genuine educational priorities. Beginning in this way also increases the likelihood of getting recruitment right, as staffing decisions are made in the context of the curriculum and long-term goals rather than as a reaction further down the line.
From incremental to needs-led
An incremental budget answers the question: “How much more or less do we spend this year compared to last?” A needs-led budget, on the other hand, begins with: “What do we want to achieve for pupils, and what resources will it take to get there?”
This shift is significant. Instead of trimming or topping up based on precedent, a needs-led approach considers the outcomes a trust is aiming for and allocates resources accordingly. It allows leaders to challenge assumptions and focus investment where it has the greatest impact.
It also helps avoid the “salami-slicing” approach to cuts, where every line is shaved equally regardless of its importance. Instead, leaders can make deliberate decisions to protect high-value areas and reduce spend in places that contribute less directly to pupil outcomes.
The role of ICFP
Integrated Curriculum and Financial Planning (ICFP) is the framework that makes a needs-led approach practical. At its heart, ICFP links staffing and curriculum planning directly to the budget. This ensures that teaching plans, timetable design, and staff deployment are not developed in isolation from the financial realities of the trust.
With ICFP, leaders can ask questions such as:
- Are our staffing and curriculum plans aligned to deliver the outcomes we want for pupils?
- Do resource allocations reflect both pupil needs and trust priorities, not just historic spend?
- How sustainable are these choices, and can we evidence that they support long-term improvement?
By answering these questions through the budget process, trusts can create financial plans that are rooted in educational intent and tested for sustainability. Some also use mechanisms such as GAG pooling to redistribute resources more equitably across schools, particularly where the national funding formula does not reflect relative need or trust priorities. It will not be right for every trust, but for some it provides an additional lever to ensure the deployment of resource is looked at holistically, not just school by school.
Stronger conversations, clearer decisions
Another benefit of shaping budgets around what matters most is the quality of conversations it enables. Budgets built on historic patterns are often hard to explain to governors, trustees, or external stakeholders. They reflect numbers more than they reflect intent.
When a budget is shaped around clear priorities, it is easier to defend, adapt, and explain. Leaders can show how choices align with strategic goals, why trade-offs were made, and what impact investments are expected to have. This clarity supports more constructive discussions with governors and trustees, and helps build trust with staff and parents.
Financial sustainability and educational impact
Ultimately, a budget that reflects educational priorities is not just a statement of intent, it is a foundation for sustainability. By focusing on what matters most, trusts can be confident that limited resources are directed to areas of greatest impact. They also build resilience by avoiding waste, duplication, or spending that is disconnected from outcomes.
The goal is not to make budgeting easier - the pressures will always be there - but to make budgeting more purposeful. When decisions are driven by pupil needs and curriculum priorities, trusts achieve more than a balanced set of accounts. They create a budget that underpins stronger outcomes for pupils and a more sustainable future for the organisation.
Conclusion
Incremental budgeting, built on what was spent last year, may be less suited to today’s challenges. Many trusts are exploring approaches that are more intentional and more closely aligned to educational priorities. By starting with pupil needs, using ICFP to connect staffing and curriculum planning to finance, and in some cases adopting mechanisms like GAG pooling, trusts have the opportunity to shape budgets that better reflect what matters most.
In doing so, they aim not only to balance the books but, more importantly, to place educational ambition at the centre while ensuring sustainability, so that every pound spent supports strong outcomes for pupils alongside financial stability.
- Warren Porter is Head of Education Strategy at IMP Software, a CST platinum partner and sponsor of the Finance strand at CST Annual Conference 2025
We welcome perspectives from a diverse range of guest contributors. The opinions expressed in blogs are the views of the author(s), and should not be read as CST guidance or CST’s position.
