RM boss Terry SweeneyRM's Terry SweeneyThe scrapping of the £55 billion Building Schools for the Future programme has prompted education services supplier RM to restructure and sustain £1.5 million “exceptional costs”. An Interim Management Statement from the company explains the issue.

However the company remains upbeat about ICT services to schools despite the halving of the £200 million Harnessing Technology funding. RM chief executive Terry Sweeney said that the "the era of big ICT schemes and centralised transformational policies" had clearly ended but that schools would continue to invest in ICT.

RM's statement refers to the second half of its financial year and says "underlying trading expectations for the full year remain unchanged". It continues: "RM's results for FY-2010 will reflect exceptional costs of c.£1.5m related to actions taken in response to the Department for Education's (DfE) recently announced review of the BSF (Building Schools for the Future) programme. This review has effectively stopped all future BSF procurement and, as a consequence, we are restructuring our strategic projects bidding activity."

The company remains positive however and adds: "Although our UK customers face uncertainties as a result of recent changes in education policy, trading in the first three quarters of RM's FY-2010 has been consistent with market expectations for the year as a whole. However, RM's business is seasonal, with the large majority of the full-year profit arising in the fourth quarter, which means that trading in the first three quarters is not a reliable indicator of outcome for the year as a whole."

RM is on track for the second half of the year to provide ICT systems in 44 BSF schools and 15 Academies. It also reports arise examination scripts marked online through its Assessment and Data Services division and more sales in its Education Resources division.

'Clearly the era of big ICT schemes and centralised transformational policies is over'

Chief executive Terry Sweeney commented: ""In his recent Emergency Budget, the Chancellor indicated that education remains a relative priority for public spending and that the Government intends to maintain 'frontline' education budgets. However, total education funding was not explicitly protected and it is likely that our UK customers' budgets will come under pressure. Whilst this will present challenges for RM, the strategy of diversification we have been adopting over recent years positions us well."

Addressing the education community's specific worries about the role of ICT in government education policy, he said: "Clearly the era of big ICT schemes and centralised transformational policies is over. But I don't think the ICT industry should worry. The power to run schools rests firmly with the senior leadership teams and now that ICT is embedded in both back office and the delivery of front line services they will make the right decision for their school. And that must include continued investment in ICT."

More information

You can read the full Interim Management Statement, with information about RM's financial status and BSF activities, here


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