Urgent warning as 90% of schools could go bankrupt next year due to spiraling energy and wages, chiefs warn

School leaders have warned that 90% of schools will go bankrupt as early as next year due to rising energy bills and wages.

Half of schools are expected to be in the red this year and there are fears that essential teaching and support staff could be lost as a result.

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Larger class sizes, reduced program options and less support for students will also be a consequence, chiefs have warned.

Chiefs and leaders of the academy said proposed new spending cuts will push many overboard.

And an increase in teachers’ salaries, which is 5% for most and still below inflation, is seen as essential but will also put schools in difficulty.

Paul Whiteman, general secretary of the National Association of Head Teachers, told the Observer“There are no more easy solutions.

“Schools are cut to the bone. This will mean reducing teaching hours, teaching assistants and teachers.

Reverend Steve Chalke, whose Oasis Foundation runs 52 academies in England, said: “At this rate of burning, in less than three years we will be bankrupt.

“No one is able to continue eating their reserves for very long.”

Electricity and gas costs across its chain have risen from £26,000 a year to £89,000, and the trust also needs to find £4.5m for teacher pay rises.

Jonny Uttley said his Education Alliance Trust academy in Hull and East Yorkshire uses reserves to manage energy, salaries and other costs.

But he said, “There comes a time when we just run out of money.”

Leora Cruddas, chief executive of the Confederation of School Trusts, said: “The government must act urgently. Public education must be adequately funded by the state.”

CEO Gary Ratcliffe said his Galaxy Trust in Dartford, Kentmust also spend more on mental health support for its students and staff struggling with the cost of living crisis.

He warned of “a very significant funding crisis” on the horizon.

A spokesperson for the Department for Education said: ‘We understand that schools are facing cost pressures due to international events which are driving up energy prices.

She added that in addition to the energy aid scheme, schools would receive £53.8bn in core funding this year “which includes a cash boost of £4bn”.