Funding options for Independent Schools

January 4, 2016

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The demands on cash flow and budgets are the same in the private/commercial sector as they are in the public sector. There is always a need to invest in new technology, purchases that must be balanced against the available cash resources.

Independent schools should therefore look to different funding options if they are to cope with rising energy costs.

At a conference of the ‘Independent Schools’ Bursars Association’ 75% of Bursars among 185 independent schools felt energy price increases were the biggest risk to their school. Where does the opportunity lie for funding with your school?

Third party funding: The general means of fundraising, finding a sponsor or investor to finance projects for schools. It has the advantage of incurring no initial capital costs of you, but generally means a period of lower rate of return. Though it may typically have a slower payback period than other traditional methods, it is still a very viable option.

Crowd funding:  A rising trend in the last three to four years. In short, it establishes a governance/legal structure for a particular project, whilst seeking funding from the public or stakeholders through sale of project equity. On a national level, it has even been the conversation in parliament as a viable industry to encourage the development of (including the regulation of it).

Asset financing: A type of finance used by businesses to obtain equipment they need. It usually involves paying a regular charge for use of the asset over an agreed period of time, thus avoiding the full cost of buying outright. It enables the use or services of assets, without ‘locking up’ capital. Asset financing is now playing a pivotal role within the education sector.

It is to an independents’ advantage to explore different sources of funding. Organisations such as Salix have afforded many state schools the opportunity to reduce their carbon footprint and save money on annual energy costs. This government funding allocated specifically toward educational institutions within the public sector has so far delivered £108 million of annual financial savings (574,319 tonnes of CO2).

But like state schools, independents are also affected by inefficient energy usage.

The common action for schools to take is procuring energy saving methods that provide returns no greater than 3%, when straightforward and effective upgrades to lighting systems alone can reduce up to 65% consumption (providing much higher returns).

It will be worth considering whether a lighting project could benefit your own school:

– What type of lighting do you currently have?

– How old is your lighting?

– When was your last lighting upgraded?

To discover more funding options available, please do contact us.

 

 

 

 

Sources:

http://www.turley.co.uk/intelligence/sustainability-and-independent-schools-changing-funding-landscape

http://www.iflr.com/Article/2027422/Lease-Finance.html

http://privateschool.about.com/od/privateschoolfaqs/f/private.htm

http://www.turley.co.uk/intelligence/sustainability-and-independent-schools-changing-funding-landscape

image – sanespaces.com – http://sanespaces.com/category/back-to-school/

 

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