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Are current funding arrangements supporting sustainability for primary-only Multi Academy Trusts?
10 August 2026
For a number of years, the Kreston Academies Benchmarking Report has brought together financial and operational data from across the academy sector, providing a valuable source of comparative insight into the performance of Multi Academy Trusts (MATs). While the 2026 report did not specifically examine the position of primary-only MATs, given the Government’s aspiration for every child to have the best start in life, we wanted to bring a fresh review of this area. As such, we reviewed the underlying benchmarking data (consisting of 250 Trusts of which 43 are primary-only MATs) which revealed a number of notable trends that warrant further consideration.
For primary-only MATs, they appear to:
These patterns emerge consistently from the dataset and raise important questions about the financial resilience of primary-only trusts. This article seeks to explore those findings in more detail, considering the extent to which they may reflect structural features of the current school funding system and whether primary-only trusts face challenges that are not experienced to the same degree elsewhere in the sector.
“This brilliant analysis is exactly what the sector needs as it raises an important question about whether the current funding model adequately recognises and values children in the crucial first stages of their education. The thoughtful commentary also provides practical ways for policy makers to make simple tweaks that would undoubtedly ease the financial pressure on primary schools as they educate and care for children during their early stages of their development.”
Ben March, Chief Finance and Operations Officer, STEP Academy Trust
The benchmarking data indicates that primary-only trusts receive lower revenue income per pupil than the wider academy population. In medium-sized MATs, the difference is particularly significant, with average revenue income per pupil approximately £780 lower than the broader sector. To give a sense of scale, a class of 30 pupils in a primary-only MAT receives on average £23,400 less funding than the broad MAT average, which scaled up across a two-form entry school equates to around £327,600.
At the same time, primary-only MATs carry lower reserves as a percentage of both General Annual Grant (GAG) and total revenue income, irrespective of Trust size. Small trusts were carrying 9.9% of revenue income in reserve compared to the broader sector average of 11.5% and this disparity is evident across medium and large trusts who collectively average 5.2% and 4.8% against wider sector levels of 7.7% and 8.1%.
Lower reserves are not simply an accounting statistic, they potentially represent reduced financial resilience. Reserves provide protection against funding shocks, unexpected expenditure, falling pupil numbers, estates emergencies and staffing pressures. When reserve levels are consistently below sector averages, trusts have less room to manoeuvre when faced with financial challenges.
Notably, staff costs as a percentage of both GAG and total revenue income are not dramatically different from the wider sector. However, the data shows a deterioration over the previous three years across all categories of primary-only trusts. The data does not indicate materially higher staff cost ratios than the wider sector, suggesting that expenditure patterns alone do not explain the lower reserve levels.
To understand these findings, it is important to recognise that primary schools operate on fundamentally different economics from secondary schools.
A secondary school typically benefits from:
Primary schools, by contrast, often require fixed staffing structures regardless of size. A one-form entry primary school still requires a headteacher, safeguarding capacity, SEND leadership, finance support and curriculum leadership. These costs do not reduce proportionately as pupil numbers fall. In addition, pupils entering primary school increasingly have little context or history. This means that school leaders have to respond rapidly to challenges that arise, even though there may be limited funding available.
Alongside this, declining rolls can quickly create financial stress in primary settings. The recent demographic shift, with lower birth rates leading to falling primary pupil numbers in many areas, is therefore particularly significant.
The growth in SEND demand is perhaps one of the most significant factors affecting primary-only trusts.
Primary schools increasingly find themselves at the front line of identifying and supporting complex needs. Whilst additional funding mechanisms exist, they are often retrospective, locally variable and administratively burdensome.
Trusts frequently incur staffing costs before receiving sufficient funding support. Educational psychologists, teaching assistants, specialist interventions and behaviour support all create immediate expenditure demands.
For a primary-only trust with lower reserves, the delay between expenditure and funding can create significant cashflow and budgetary pressure. Larger mixed trusts often have greater capacity to absorb these fluctuations through wider income streams and larger overall balance sheets.
One particularly interesting finding from the benchmarking analysis is that medium-sized primary-only trusts included in the dataset appear significantly more likely to pool GAG funding or reserves than the wider academy population, with around 75% pooling compared to 41% in the broader MAT dataset.
This may appear surprising initially. However, it may actually represent an adaptive response to financial pressure.
Pooling allows trusts to allocate financial resources more effectively, directing them to the schools that need it most. It creates a financial model based on collective responsibility rather than individual school performance. In sectors facing uneven financial challenges, pooling can improve overall sustainability.
The higher pooling rates in primary-only trusts may therefore indicate both good financial leadership and increased financial vulnerability. Put simply, trusts may be pooling because they need to.
The National Funding Formula has undoubtedly brought greater transparency and consistency to school funding. However, it remains largely pupil-driven.
This approach works best when pupil numbers are stable or growing. It becomes more problematic when demographics move against schools.
Policy challenges raised through discussions with sector leaders include:
A significant proportion of school costs are fixed rather than variable. Funding based primarily on pupil numbers may not fully recognise this reality.
A school losing 10% of its pupils rarely loses 10% of its costs, and certainly not at the same rate.
The lump-sum element within the funding formula helps, but many would argue it is insufficient to reflect the true fixed costs of running smaller primary settings.
Current arrangements often reimburse costs rather than proactively funding need. This creates financial uncertainty precisely where certainty is needed most.
The benchmarking analysis suggests primary-only trusts generate lower overall revenue income than the wider sector.
This is partly structural. Primary schools generally have fewer opportunities to generate commercial income through sixth forms, facility lettings, vocational programmes or large-scale partnerships.
Once a trust reaches the SCA eligibility threshold of 5 schools and 3,000 pupils, it is no longer eligible to access the Condition Improvement Fund (CIF) and instead receives formula-based School Condition Allocation (SCA) funding. In the 2026-27 CIF round, the average successful project attracted funding of approximately £562k.
Based on average school sizes of around 280 pupils for primary schools and 1,000 pupils for secondary schools, an average primary-only trust would typically move into the SCA regime at around 11 schools (3,080 pupils), compared with around 5 schools (5,000 pupils) for a secondary trust. The SCA methodology also applies a 50% higher weighting to secondary pupils than primary pupils.
So, Primary trusts lose CIF access when they are responsible for roughly 11 separate school sites, whereas secondary trusts typically do so with only 5 sites. Yet the SCA formula subsequently gives greater weight to secondary pupils. It should be noted that the higher weighting reflects the generally larger and more complex estates associated with secondary provision.
Sector stakeholders have suggested a number of options to improve the financial sustainability of primary-only MATs, which policymakers may wish to consider including:
A larger fixed allocation per school could better recognise unavoidable operating costs and reduce over-reliance on pupil-driven funding.
Transitional funding linked to demographic decline could provide trusts with time to adjust staffing and estates arrangements where pupil numbers are reducing.
Funding mechanisms that allocate resources at the point of need rather than after lengthy assessment processes could significantly improve financial stability.
There may also be merit in recognising trust-level responsibilities within funding allocations. MATs are increasingly expected to provide school improvement, governance support, safeguarding oversight and specialist expertise. These functions create costs regardless of trust size.
The current funding system recognises differences in age and educational stage within the secondary sector through separate funding rates for Key Stage 3 and Key Stage 4 pupils. No equivalent distinction exists within primary education, where funding rates are generally applied consistently across the primary age range. Given the significant developmental progression that occurs across the primary phase, there may be merit in exploring whether existing funding arrangements sufficiently reflect differences in need and provision between younger and older primary-aged pupils.
The benchmarking data points towards a consistent pattern. Primary-only MATs appear to be operating with thinner financial margins, lower reserves and lower income per pupil than their mixed-sector counterparts. At the same time, staffing pressures, SEND demand and demographic decline are placing increasing strain on the primary system.
Importantly, this does not appear to be a story of financial mismanagement or poor stewardship. Staff cost ratios remain broadly comparable to the wider sector, suggesting that many primary trusts are already operating efficiently. The findings are consistent with concerns that current funding arrangements may place greater pressure on primary-only trusts.
As the sector looks towards 2030, the sustainability of primary-only Trusts is likely to become a major policy issue. Unless funding mechanisms evolve to better recognise fixed costs, demographic pressures and growing SEND demand, many trusts may find it increasingly difficult to maintain financial resilience.
The irony is that primary schools sit at the foundation of the education system. Ensuring their long-term financial robustness may ultimately require a funding approach that recognises their unique economics rather than assuming that one model fits all.
As this becomes an increasing area of interest and discussion across the sector, we intend to explore this data in greater depth in the next Kreston Academies Benchmark Report, helping to support the sector in identifying practical ways to strengthen financial resilience.
Understanding the financial challenges facing academy trusts requires both sector expertise and practical insight. If you'd like to discuss funding pressures, financial sustainability or benchmarking performance within your trust, our Academies team would be happy to help.
Data derived from the 2026 Kreston Academies Benchmarking dataset comprising 250 Trusts. Results compare 43 primary-only MATs against the wider sector dataset.
The views expressed are based on analysis of benchmarking data and discussions with sector leaders. The findings should be regarded as indicative rather than definitive and do not constitute policy recommendations.
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