Almost a third of multi-academy trusts expect their reserves to fall below the level classed as potentially “financially vulnerable” by 2029.
The proportion of MATs forecasting reserves of less than 5 per cent of annual income is expected to rise from 23 per cent in 2026-27 to 32 per cent in 2028-29, analysis has found.
This means 99 of the 312 trusts included in the analysis expect to fall below the , up from 71 in 2026-27.
The report based on budget forecasts from MATs - from IMP Software and the Confederation of School Trusts (CST) - also says 37 per cent of trusts forecast an in-year deficit in 2026-27, down from 55 per cent the previous year.
However, a deficit can reflect planned spending from reserves rather than financial difficulties, the report cautions.
Will Jordan, chief executive of IMP Software, said: “Overall, updated forecasts offer some encouragement, but declining reserve headroom and uneven pressures across school phases remain significant concerns.”
Growing pressure on primary trusts
The proportion of primary-only trusts expecting reserves to fall below 5 per cent rises from 17 per cent in 2026-27 to 28 per cent by 2028-29.
Among secondary school-only MATs, the proportion falls from 19 per cent to 11 per cent, though there are few of these trusts.
Trusts operating the smallest schools also expect median reserves to fall from 7.5 per cent to 6.2 per cent of income by 2028-29, compared with a drop from 8.3 per cent to 8 per cent among those running the largest schools.
Falling pupil numbers and the fixed costs of running smaller schools are among the pressures affecting trusts’ financial resilience, the report suggests.
Trusts running smaller schools face particular pressures because costs such as leadership, premises and administration must be spread across fewer pupils.
Financial forecasts improve
Among trusts included in both this year’s and last year’s reports, the proportion predicting an in-year deficit for 2026-27 has fallen from 54 per cent to 41 per cent.
Just under a quarter moved out of deficit since their previous forecasts, and 11 per cent moved into deficit.
And 66 per cent now expect higher reserves in 2026-27 than anticipated a year ago, according to the report.
Despite a recent improvement in trust finances, a CST survey last month found that half of trust leaders expected reserves to fall over the coming year, with falling pupil numbers, SEND costs and teaching staff costs identified as the biggest financial risks.
Previous Vlog analysis found that 261 academy trusts had recorded deficits for three consecutive years, with significantly larger deficits among those serving higher proportions of disadvantaged pupils and pupils with SEND.
Teaching assistant numbers fall
The number of primary teaching assistants is forecast to fall by 3.8 per cent between 2026-27 and 2027-28 across trusts - more than twice the projected 1.6 per cent decline in pupil numbers, the report says.
Teacher numbers are expected to decrease by 1.9 per cent over the same period, although the report says staffing reductions are concentrated in a minority of schools.
The analysis also found that schools with less funding per pupil tended to have higher pupil-to-teacher ratios and spend a greater share of their income on teaching staff.
Teaching costs account for a median of 39 per cent of income in the lowest-funded quarter of primary schools, compared with 34 per cent in the highest-funded quarter. In secondary schools, the figures are 49 per cent and 40 per cent respectively.
CEO pay
The median budgeted CEO salary across the trusts in the report is £159,352, and the median chief financial officer salary is £94,988 in 2026-27, according to the report.
The proportion of MATs budgeting CEO pay at or above £174,000 is projected to rise from 34 per cent this year to 46 per cent by 2028-29, although new government salary approval requirements only apply to new posts above the threshold.
Centralisation and pooling
Among the trusts included in the report across consecutive years, 24 per cent now centrally manage HR, procurement, finance and facilities - up from 21 per cent.
Just over half of trusts pool their reserves, but only 18 per cent pool their general annual grant funding.
The report says it found no evidence that one approach produced stronger financial outcomes.
The trusts covered in the analysis ran a combined 3,929 schools.
