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Research articles

Implementing new funding and governance structures in Scottish schools: associated social risks

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IMPACT

This article assesses possible unintended consequences of a targeted funding model for school education by analysing a Scottish Government policy operationalized via the Pupil Equity Fund (PEF) allocated directly to Scottish schools. Analysis herein reveals implementation of new funding and governance structures within school education may introduce social risks and, in particular, that a targeted policy approach can frustrate a holistic approach and thereby constrain achievement of intended policy objectives. This analysis utilizes a unique read-across between disciplines and contributes to the study of policy-making in public services by exploring contextual risk management frameworks with that of school improvement.

ABSTRACT

This article examines the implementation of new school funding governance structures and their interaction with social risks, especially reductionism. It extends ongoing discussion in Public Money & Management on risk governance during public service change. It finds case study evidence of reductionism and recommends its management and mitigation through contextually customized policy implementation—holistic in approach and incorporating stakeholders’ input. In so doing, school education services can function as complex adaptive systems proactively responding to social risks.

Introduction

The management of risk within a school education setting tends to be conceptualized through the delivery of statutory functions. For example, risk management processes in Scotland are set out within legislation underpinning the principles and values of the Getting it Right for Every Child framework (GIRFEC), including additional support needs, child protection and the quality of educational provision (Education Scotland, Citation2021). This article explores the introduction of two changes to Scotland’s education policy which have implications for other countries: the introduction of pupil equity funding and the Scottish Government’s ambition to review the governance of schools through amendments to the provisions of the Education (Scotland) Bill (Scottish Government, Citation2018a).

The article extends the conversation in Public Money & Management on risk governance and change during public service provision (Osborne et al., Citation2019; Rana et al., Citation2019a. Citation2019b; Flemig et al., Citation2016; Osborne & Brown, Citation2011) by focusing on social risks associated with implementing new funding and governance structures within Scottish schools and local authorities, from a practitioner perspective. Studying governance is important because it provides a more critical view of economy, society, and politics (Chhotray & Stoker, Citation2009). Since schools occupy critical roles in these three dimensions, studying school governance is necessary (Connolly et al., Citation2014) and particularly following policy changes (Raffe et al., Citation1999). The increased expectations following these changes exert considerable pressure on school governance (James et al., Citation2011), introducing unique challenges for service managers and policy-makers (Osborne & Brown, Citation2011) because they are fundamental and complex, without readily available solutions (Heifetz et al., Citation2009). Their solution to these challenges requires public sector leaders to work with employees and service users (Bailey et al., Citation2012).

The dilemma: the ‘attainment gap’

Raising attainment outcomes for school pupils is an objective of the current Scottish National Party (SNP) administration (Scottish Government, Citation2017). The government wants to ‘create a school- and teacher-led education system that will empower schools and school leaders. The persistent significant differences in schools’ examinations results between affluent and deprived areas (the ‘attainment gap’) is also a priority (Education Scotland, Citation2017). The attainment gap refers to the lower pass rates and/or poorer grades being achieved by pupils living in deprived communities compared with those in more affluent areas.

The attainment gap is a socio-economic challenge that defies change (Mowat, Citation2018). It persists (HM Treasury, Citation2018) in all four UK nations, England (Berridge et al., Citation2020), Northern Ireland (Gallagher, Citation2019), Scotland (Mowat, Citation2018), and Wales (Welsh Government, Citation2017), as well as in the USA (Chmielewski, Citation2019) and in many other countries. This adversely affects social mobility and reinforces inequality—with far-reaching adverse social and economic consequences, including increased unemployment, poverty, and poor health and wellbeing.

The attainment gap is an example of an adaptive challenge because it requires more than reform or transformative change in schools alone. It requires new learning to develop change models that can reduce poverty levels and improve the provision of healthcare, social care, and housing services. It should also alter the perception of school provision and reform by communities and families (Shields & Gunson, Citation2017).

One of the key funding models tackling this attainment gap and inequality of learning outcomes is the Scottish attainment challenge (SAC) fund. It is divided into a challenge authorities programme, a school’s programme, and a pupil equity fund (PEF) (Scottish Government, Citation2019; Citation2020). Between 2015 and 2019, the SAC was expected to provide approximately £100 million to improve numeracy, literacy, health, and wellbeing in nine local authorities with the most deprived communities in Scotland (Scottish Government, Citation2016). It was later extended to 2020/21 and increased to £750 million (Scottish Government, Citation2018b). Equality impact assessment was conducted on the SAC to ascertain any potential positive or negative impacts on children and young people, specifically those related to ‘protected’ characteristics, including disability, gender and gender reassignment, pregnancy, race, religion or belief, and sexual orientation (Scottish Government, Citation2018c). No negative impact was identified during the assessment process, although new avenues for advancing equality of opportunities were identified for children and young people with protected characteristics (Scottish Government, Citation2018c).

Theoretical framework

Social risk management

Objective risks have a finite number of outcomes, lend themselves to precise scientific measurement and are considered free of bias (Hood & Jones, Citation1996). By contrast, evaluation of subjective or perceived risks reflects individual or group opinions and values and so stakeholders’ different evaluations of the same risk can yield different results. There has been a clear shift from objective to subjective risks (Lee & Kwon, Citation2016), possibly reflecting the need to incorporate diverse perceptions of risk among multiple stakeholders.

Social risks (Asenova et al., Citation2014) can adversely affect individual service users directly and/or a large proportion of society indirectly leading to further deprivation, societal disadvantage, and hardship within communities. The World Bank (Mckinnon, Citation2004) introduced the term ‘social risk’ to refer to the creation of such negative outcomes as increased inequality, poverty, socio-economic disadvantage and exclusion of individuals and communities (children, young people, elderly, disabled, poor) most dependent on public services (Asenova et al., Citation2015). Generally associated with poverty, social risks could include an opportunity loss relating to lost potential for learning and achievement and so increased attainment gaps as children from wealthier homes perform better than those from deprived families in numeracy and literacy (OECD, Citation2015).

Complex adaptive systems (CAS)

CAS theory highlights non-linear relationships between system variables and their outcomes (Radford, Citation2006); the adaptive orientations and dynamic relationships of a system giving birth to new behaviours, new patterns and changing old properties (Mason, Citation2008). CAS theory (Pascale, Citation1999) is a dynamic association of different agents acting analogously, responding continuously to the actions of other agents, and thus influencing conduct and associations in a holistic manner (Lichtenstein et al., Citation2006). CAS theory has been applied to several sectors, including engineering (Bainbridge, Citation2006), economics (Wang et al., Citation2009), management (Brown, Citation2008), and education (Keshavarz et al., Citation2010).

All CAS have identical characteristics (Holland, Citation2014). First, they are complex—meaning the system comprises a variety of different and specialized agents which are intricately arranged. Second, they have adaptive capacity—meaning they have memory which enables them to learn from experience, change if necessary, and become resilient in a crisis. Third, they exhibit emergence—meaning the whole exceeds the sum of the individual components. School education services globally can be categorized as CAS. In this case, their complexity is evidenced in the intricate relationships between the internal agents (the Scottish Government, Education Scotland, local authority managers, and school education officers) and external agents (schoolchildren, parents, and communities/society). Schneider and Somers (Citation2006) refer to CAS as ‘poised systems that function at the edge of chaos’; they are flexible and can evolve quickly by gathering useful variations (ibid.); they are a suitable equilibrium point between stability and instability (Lewin, Citation1999); and they are adaptive (Cilliers, Citation2000). Schneider and Somers (Citation2006) imply that all CAS are successful, but Sweetman and Conboy (Citation2019, p. 4) distinguish between successful and unsuccessful CAS by explaining that successful CAS are poised systems at the edge of chaos, in a ‘space of possibilities’ where they can achieve their objectives.

CAS thinking opposes taken-for-granted assumptions of policy-makers and researchers that effects are directly linked to causes via a linear relationship. In the case of the SAC, the Scottish Government’s assumption is that funding targeted at deprived schools and pupils will significantly and directly reduce the attainment gap. CAS thinking chooses, instead, to see the attainment gap as a symptom of a wider range of (non-linear) socio-economic issues relating, for example, to alcohol abuse, poor adult education, and inter-generational poverty. Hence, a linear cause-and-effect approach is an oversimplification (Health Foundation, Citation2010).

Methodology

Our methodology was based on the interpretivist paradigm that social reality is a product of societal construction—meaning that people’s perceptions are shaped by their background and experiences (Blaikie, Citation2010). Accordingly, the case study methodology (Yin, Citation2009) was adopted in a local authority (‘Alpha council’), based on perceptions of interviewees (Crowe et al., Citation2011) to enhance understanding of social risks in a Scottish school education context (Enang et al., Citation2020).

Primary data was collected through in-depth, semi-structured interviews, analysis of meeting minutes and official documents. Secondary data was gained from 36 documents (journal articles, Scottish Government publications and reports by external auditors) published between 2005 and 2018.

Interviewees

lists the nine officials interviewed in Alpha council. The respondents represented four different managerial levels, with strategic and/or implementation roles in leading and managing schools in a Scottish local authority. Two interviewees (the chief executive and communities director) were senior managers with strategic roles (SMS) and three were senior managers (education director, head of education and schools’ manager) with strategic and implementation roles (SMSI). Another three (internal auditor, inclusion manager and improvement manager) were middle managers with strategic roles (MMS), and one (service review manager) was a middle manager with strategic and implementation roles (MMSI). The diversity in managerial levels facilitated understanding managers’ perceptions of the social risks.

Table 1. Managerial levels of respondents.

Interview responses summarised capture the number of managers in each level who were knowledgeable about the issues. The semi-structured interviews were administered face-to-face. Included in the interview schedule were key clarifying, semi-structured, and open-ended questions which encourage active dialogue between respondents and interviewers (Denzin & Lincoln, Citation2005).

Table 2. References to reductionism as social risk.

Findings

Documentary analysis

The local authority context: Alpha council is in a large, predominantly rural area. Services are tailored to address the specific needs of each sub-region. For instance, education services collaborate with social workers to deliver specialized services to vulnerable communities. However, it may be difficult for minority and relatively small groups to access these specialized services in a consistent manner because the communities are geographically dispersed.

Alpha council has a relatively low-wage economy, a low-skilled and declining workforce, and high levels of youth unemployment. Less than 20% of the income-deprived and unemployed population reside in the most deprived areas and so the other 80% may be excluded from change management initiatives or resources earmarked for deprived communities. They are not identified by the Scottish Index of Multiple Deprivation (SIMD) because it concentrates on identifying area-wide poverty, rather than individual poverty. Poverty has a negative impact on educational outcomes, which is demonstrated by the persistent attainment gap (especially in numeracy and literacy) between high-income and low-income groups (Sosu & Ellis, Citation2014).

One way for Alpha council to deal with poverty and the attendant inequality is by raising overall school attainment. A combination of partnership-working, universal support and targeted interventions for young people is being used to address this via the SAC and PEF funding, the Children Services Plan, Education Service Business Plan, Education Service Report, and Single Outcome Agreement.

Alpha council’s major objective is to attract and retain young people by delivering excellent and equitable education services for employment. Although the annual budget for Alpha council’s education directorate comprises almost 50% of its total net revenue. It is constrained by the Scottish Government’s ongoing fiscal consolidation and requirement to deliver efficiency savings. This is compounded by being required to maintain teacher numbers and the associated high teaching costs.

Analysis of interviews with officials at alpha council

Social risks associated with implementing new governance structures

Reductionism is ‘an attempt to explain a complex inter-related whole in terms of its simpler elements or parts, or in terms of elements belonging to a lower level of phenomena’ (Sloane, Citation1945, p. 217). Five out of nine managers associated the risk of reductionism with the implementation of new funding and governance structures. The remaining four associated the risks of exclusions and inequality with this reform process. The latter two social risks fall outside the scope of this article, and so will not be discussed here. Three out of nine managers () identified reductionism in allocating SAC funds and the PEF, treating the attainment gap as the problem (rather than a symptom of a set of problems requiring poverty alleviation). According to SMS-1A:

The issue is the housing, the culture, the opportunities for learning and development. They are wider ones. So, therefore I think that the danger is that we have got an outcome (attainment gap) but we're trying to pursue it, with just one string to the bow [i.e. in a linear way], rather than having many strings [i.e. a non-linear approach]. We've focused it down.

MMS-2A and MMSI-1A supported this argument, but from different perspectives. MMS-2A explained that devolving spending should not focus solely on addressing the attainment challenge but should also include the development of a range of social skills (for example effective communication, confidence, and adaptability). MMSI-1A explained that efforts to raise attainment seemed to focus mainly on improving literacy and numeracy skills, whereas ensuring their health and wellbeing could help children learn better.

According to MMS-2A, the question should not be standalone; enquiring how the attainment challenge should be managed. It should be a series of inter-related broader contextual questions that seek to identify and address the learning, social, healthcare and accommodation needs of individual school children and their families. Alpha council’s 2017–2022 plan corroborates this argument by highlighting the relationship between parental substance abuse and the increased number of looked-after children in the council area. According to the plan, Alpha council are adopting a proactive rather than reactive stance to managing this risk by ensuring better child protective services assessment and by providing early family, professional and parenting support.

SMS-1A considered the practice of allocating the PEF directly to schools as simplistic. That manager believed that headteachers’ ability to effectively allocate relevant resources may be limited by their ‘bounded rationality’, in that they are primarily trained to teach, and manage schools, teachers, and children.

The consensus at strategic and implementation levels of senior and middle management was that reductionist risks could be managed by addressing a range of contextual socio-economic issues that cause the attainment challenge, better managed at the macro-level by the Scottish Government.

SMS-1A explained that reductionism could stem from the use of the ‘lens’ approach to school education reform—this approach may not deliver positive learning outcomes for individual pupils because the government, education department and their partners assume a silo approach to treating the symptoms that they see in relation to their lenses. The attainment challenge therefore becomes both a consequence and a symptom of not addressing attainment holistically, as is expected through the GIRFEC framework. The manager explained that key contextual issues relating to health, social care, and/or housing that impact an individual’s attainment can be ignored if they are viewed with different labels and from different lenses. Furthermore, partnerships developed to facilitate the delivery of school education may not function effectively.

SMS-1A believes that this risk can be managed by social inclusion; meaning pupils are treated from a holistic perspective as citizens. This is expected to allow different public sector departments to participate in their overall development by aligning all services (school education, health, social care, policing, and others) to address their individual needs. Such an approach can be challenging for some service areas and difficult to implement in practice.

Similarly, MMSI-1A believed that reductionism may originate from lack of clarity whereby teachers do not have enough relevant information about their pupils outside their learning needs. Lack of clarity could also mean that headteachers, teachers, school managers and leaders are unsure of their roles and responsibilities while implementing PEF. If the approach does not have GIRFEC at its heart, individual professionals may not have all the levers to effectively address the needs of young people, which may have consequences on attainment.

While the management of this risk is prioritized, the council needs to be fully aware of information gaps in young people’s wellbeing. MMSI-1A said that the council partly addresses this risk through regular meetings between the chief executive and the directors and heads of services. However, the manager reported that implementing new funding and governance structures may sometimes be ineffective because the consequences and connections are not always communicated to staff at implementation levels of the organization. Furthermore, the disconnect between the strategic objective set, the tensions in managing a wide range of priorities and how they are implemented in different contexts and by different middle- and front-line managers could reduce the effectiveness of any single lens approach to school education reform. In the long term, this disconnect may institutionalize any reactive, rather than proactive, approach to public service reform.

Within the school context, implementing new funding and governance structures mostly focus on raising overall attainment over a very short period, with annual reporting of impact on PEF spend against the closure of the attainment gap at school level, not being considered at the senior or middle management levels. It was considered by MMS-1A probably because this officer was more aware of the need for legislative compliance and the financial risks that may accompany non-compliance.

In summary, interviewees across all managerial levels of implementation and strategy recognized reductionism as the key social risk associated with implementing new funding and governance structures to close the poverty-related attainment gap.

Discussion and recommendations for practice

Reductionism as social risk

The Scottish Government has introduced a very specific targeted funding stream for schools, but this reductionist approach does not facilitate consideration of wider social risks and the potential for multi-agency partnership working, both of which could help overcome the attainment gap.

Public service reform in response to policy pronouncements is neither linear nor sequential because of unforeseen dynamics—especially unconsidered interactions between different parts of the wider service programme. Adding an extra objective to a multidimensional service, in the belief that it is a simple ask of practitioners, is naive on the part of policy-makers. Dynamic interactions between objectives can be expected to occur as the focus of practitioners’ day-to-day work shifts to the latest policy initiative and there should be more recognition of how it is not possible to introduce additional requirements of practitioners in a linear fashion.

Attempting to do (a bit) more (policy) with less (or the same) resources requires going beyond incrementalism in practitioner procedure. In making additional policy pronouncements, governments should consider how their pronouncements will be perceived, translated, and implemented by practitioners in the context of their management structure and resource base. Public service reform applies not only to policy objectives but also to service delivery, articulated via changing working practices on the part of management thinking and management procedures.

Conceptualizing social risk and its inclusion in risk registers

It is notable that the case study interviewees never mentioned any guidance from the corporate risk management level down to the departmental level. Moreover, the concept of social risk was not something that was included in corporate-level risk management, this being about risks associated with, fir example, new buildings and digital infrastructure. Social work and education are not involved in that because the professional risk managers concept of risk is technical ‘hard’ risks that can be quantified and then mitigated (for example via insurance), not ‘soft’ social risks that are difficult to define, identify and to quantify and which are not susceptible to mitigation by insurance or other such actions.

Looking back to the way risk registers have developed, this conceptualization of social risk helps that risk-register approach to evolve to be more responsive to the needs of a wider range of disciplines. The assessment of risk to society, rather than building or project management, allows multi-agency partnerships to have a common language and a shared lens through which to view changes to practice, workers in health and social care, police and education assessing and managing risk every day. However, it can be difficult to encapsulate the complexity of this within a risk assessment template without the concept of social risk within broader, risk governance issues.

A risk register broadened to include social risk works directly through the way teachers interact with parents as well as pupils and, maybe, other community, educational and welfare organizations to develop a shared language around social risk. Policy debates frequently refer to vulnerable families, but this social construct is not articulated to a conceptualization of social risk that helps education practitioners and stakeholders see their place in its management and mitigation.

Towards the governance of social risk: a multi-agency approach

The Christie Commission (Public Services Commission, Citation2011) recognized the effectiveness of partnership working as a way of improving public health. That approach can likewise be applied to closing the attainment gap. We have shown that councils have necessarily adopted a linear micro-level approach to closing the gap in the past. Their collaboration with other departments, communities, families, and other such stakeholders can enable the school education system to function as ‘a whole’ by adapting to the socioeconomic and cultural environment that creates and perpetuates the attainment gap. In this way, they can develop improved and more comprehensive professional practices for the management and mitigation of social risks, as well as their management of service and corporate risk. Thus, attainment gaps can be holistically addressed by including all relevant stakeholders in a risk governance framework which is designed to be understood in a multiagency context.

The PEF was introduced with good intentions and clear policy ambitions but the requirements to provide evidence of impact, which is directly causal to the spend, can, in practice, lead to reductionism in implementing the PEF.

School inspectors judge schools’ implementation of policy and their performance in respect of examination results and the Education Scotland Inspectorate benchmark. ‘Off rolling’ (where a school excludes poorly performing pupils from the school roll) is an example of how managers (i.e. headteachers) could seek to move up the national league table of school exam results. However, the PEF follows the child and so school exclusions for such management-imperative reasons are unlikely because, if a school excludes a child, it loses PEF monies. Instead, reductionism is the main social risk associated with implementing the PEF.

Dividing the block grant for education into earmarked sections to address specific policy issues sounds like a good idea politically—in this case addressing the attainment gap. However, earmarking means that practitioners will focus on managing the specific grant, which may be counter-productive in diverting attention from the more holistic approach funded by a broad block grant. This is a nuanced point about management capacity. PEF funding is a very small proportion of the typical education department budget. The PEF paid directly to schools managed by Alpha council was less than 3% of the council’s schools’ budget. The bureaucracy and workload in Alpha council’s allocation and administration of PEF (including reporting and scrutiny) was disproportionate to the same bureaucracy in respect of its education budget.

We found that this disproportionate focus of management attention also applied to a range of very small, targeted grants (for example for free sanitary products and looked-after children’s attainment) which all individually must be drawn down, reported on and scrutinized, resulting in considerable management (opportunity) costs in terms of less time to manage other responsibilities. Education managers could instead be focusing on supporting schools, mentoring headteachers, providing professional development, but a disproportionately large part of their time is spent tracking, monitoring, and scrutinizing the raft of targeted small pots of money.

We established that, in Alpha council, education practitioners can feel detached from what is perceived as a risk governance process which is separate to the GIRFEC or public protection arrangements. Financial and reputational risk seem distant from their day-to-day child protection matters or school improvement priorities. The concept of social risk offers practitioners a language to articulate the risks with which they are much more familiar and a prominence within corporate sphere risk registers which had not previously included that risk.

Local authorities are required to consult their risk registers. A risk register is inherently highly specific. It perceives the management of risk in terms of child protection risk, health and safety risk, financial risk and reputational risk. These are all risks that schools are very familiar with and well-practiced at addressing. The research reported above goes beyond conventional risk registration in providing an original conceptual framework with a theoretical underpinning about societal risk, a novel contribution for practitioners to consider adopting to make risk registers more robust and holistic. Put simply, they are not simply the ‘tick box’ exercises within a very narrow management approach previously claimed by critics. The more holistic risk governance approach means that the risk register becomes a more strategic way of thinking, translating the language and culture of the teacher managing risk in school every day to the requirements of the corporate risk register. This work on social risk has facilitated this translation between organizational cultures, particularly in relation to managing risk associated with budget savings and service transformation.

Conclusion

This article has shown that implementation of new school education funding and governance structures introduced social risks of reductionism, the management and mitigation of which require policy implementation to be contextually customized, holistic in approach and based on input from all relevant stakeholder groups. School education practitioners need to understand how they can best manage and mitigate the social risks associated with change, while acknowledging that they cannot close the education attainment gap on their own because of its macro-level as well as micro-level characteristics.

Nonetheless, education managers should broaden their way of working by engaging more effectively with other service departments within their own authority and by collaborating with other public sector institutions. Broadening their way of working could also entail recognizing that service users and community groups can be used as learning resources to reduce risks.

We believe this conclusion applies more generally beyond Scotland, certainly across the UK, as well as to other public services.

This research also contributes to CAS theory by demonstrating how school education services functioning as CAS may thrive during service change if they evolve and are responsive to factors, such as social risks, that underpin its existence. The real strength of this work is in providing a structure, an academic overview of the theory of risk to provide school practitioners with a conceptual framework to understand what they perceive in dealing with the attainment gap. The CAS framework develops for them (i.e. school practitioners) a new way of looking at risk, facilitating their awareness of social risk and the lessons to be learned. It provides a new language, a language of risk, and a way to translate understanding between disciplines.

Our single case study is not intended to provide representative results but, instead, to stimulate discussions on the need for increased social risk awareness and management while implementing changes to school and public governance structures. Accordingly, further empirical research requiring more case studies is required to understand the mechanism behind social risk (re)production and legitimization, to guide the development of a systematic approach to social risk management.

Acknowledgements

We would like to thank the anonymous reviewers for their feedback, comments, and suggestions which has significantly improved the analysis and discussions within this article. We also acknowledge and are grateful to Glasgow Caledonian University for funding this research project.

Disclosure statement

No potential conflict of interest was reported by the author(s).

References