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Education cuts force RM to take £1.5m hit

Profit chart

By Barry Collins

Posted on 26 Jul 2010 at 08:59

The Government's planned cuts in education spending have forced IT supplier RM to take a £1.5m charge this year.

In an interim management statement issued this morning, the company admits that the Government's plans to effectively scrap its Building Schools for the Future (BSF) programme will have a dramatic impact on the company's order book.

While RM expects to fulfill all of the schools contracts it was awarded this year, and more than 80% of those awarded next year, it expects to complete fewer than 40% of the deliveries planned for 2012 and beyond.

Consequently, the company is "restructuring" the team that dealt with project bids, which will cost the company £1.5m in this financial year.

"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," chief executive Terry Sweeney claims.

"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."

The company's statement reports that RM's net debt stood at £22.1m at the end of June, compared to £14.6m at the end of June 2009.

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User comments

RM? Who is RM?

IT installs in schools are shocking poor. My sons school has no proper internet filtering - you would think that would be number one priority.

By drummerbod on 26 Jul 2010

RM..

http://www.rm.com/Company/Generic.asp?cref=GP11726
1&SrcURL=/company/Default.asp

The link between the rest of your post and the article is tenuous at best.

By pinero50 on 26 Jul 2010

RM

RM are absolute rubbish i know a school technician who had to call them in and they did what they had to and broke all the servers and machines.

By Deathtaker27 on 26 Jul 2010

@drummerbod

RM is one of the largest IT suppliers to school in the country. They are probably in more schools than any other company. I have to assume that your son's school does not use them (since you had never heard of them) but the filtering software is very effective.

In our school, filtering is done first by the LEA to get rid of the most common and objectionable material. After that, we have finer control over blocking and allowing websites at the school's discretion, eg. we may allow 6th formers to access websites with objectionable views on fascism so that they may discuss these for Philosophy or English, etc. (Just an example, don't know if they do or not).

This local filtering is done using RM Software on RM hardware running RM Network software. If it's not done properly, that's the fault of the technicians responsible, and this is true whether they are using RM or not. I would suggest you discuss the filtering problem with the headteacher, they are usually receptive to parental concerns over website access on their premises.

By mviracca on 26 Jul 2010

On another note...

RM are in over the summer installing a new version of their network software, though we could now do with them replacing the hardware too, the students are now regularly complaining over the speed of the machines.

But I hope they don't hit schools with increased prices and costs as we are being forced to make cutbacks too.

By mviracca on 26 Jul 2010

RM (Research Machines)

They made god-awful overpriced computers, back when schools should have been buying BBC Micro's but due to some shinanigans, bought RM boxes instead.
The whole "preferred supplier" thing is now illegal, although that doesn't stop it going on.

I did see some RM PC's recently in my son's school and I shudder to think how much money has been wasted buying them when better quality cheaper alternatives are available.

By cheysuli on 26 Jul 2010

Cheysuli

"I did see some RM PC's recently in my son's school and I shudder to think how much money has been wasted buying them when better quality cheaper alternatives are available."

Then the on-site technical team is either lacking in knowledge or is lazy. I'm Network Manager in a school which has been using an RM network (CC3) since 2005 and we haven't bought any new RM-branded PCs since the initial injection of machines when the network was originally installed.

RM offers an option of using a computer which already has Windows XP Professional installed on it, then adding all the RM network gubbins onto - it's called Smartclienting and is fully-supported by RM, as is adding the necessary drivers to the RM build disk and building it completely off the network, as per standard RM machines.

So the options are there to save huge amounts of money buying better quality, cheaper computers - if the ons-ite ICT teams are willing to pull their fingers out. I'd be seriously worried about the level of ICT support in your son's school, rather than blaming RM who, in my experiences, haven't been perfect but have been a massive and welcome provider of support and tools over the years.

By bioreit on 26 Jul 2010

@bioreit

It's not RM, but Kent County Council who are to blame.
KCC were forcing schools to buy RM machines, even when I was at school (380Z) and long before "computers" and "computer science" was rebranded to IT, then ICT. Certainly most computer studies lessons were under the maths or science departments. Hardware was repaired through contractors recommended by the KCC.

By cheysuli on 26 Jul 2010

Ahhh... I see. Would it not have been better for the government to impose the same company on all state run schools so they all have the same standards?

By drummerbod on 26 Jul 2010

False information

@cheysuli

How ignorant of you. Back when the 380Z existed - there was no other IT provider who taylored computers for education. Who else would they approach to get IT into schools? BBC Micro? Fine if you had a supplier who could install, support and maintain them. RM did just that.

RM have long since been just one fish in a big ocean of suppliers for 20 years and Kent have been one of the only LEA's NOT to force schools to spend their money in a certain way.

You really shouldn't speak about something unless you know your facts. I do and no, I don't work for RM.

@drummerbod

In theory - a government run education IT system is a good idea, but the problem is one Headteachers idea of how lessons should be taught is different from another.

Furthermore - whilst some say RM are an excellent provider (granted - most of those who say that are their own sales guys) but lots loath RM and everything about them.

A single suppier would push up costs not reduce them. After all - whats the point of keeping the prices down when there is no competition.

By metalmonkey on 26 Jul 2010

@Metalmonkey

Completely understand where you are coming from. Unfortunately that means business before education and the result is that schools supported by RM appear to be better than those that are not (my sons school).

By drummerbod on 26 Jul 2010

@ Cheysuli

Not disouting what you said, but I work in a KCC school and we've never been forced (or even nudged) towards RM and neither have the four other secondary schools in our immediate proximity - although the grammar very near to us was very RM-oriented, although we always suspected that was due to a complete lack of effort on the part of the Network Manager. I do know that we and several other schools in the area would never have dreamed of using RM support for anything except the "I'm totally stumped" problems. Cheaper and usually better to use in-house techs.

It is interesting to note that the whole BSF program (back when it existed) was pushing back towards a single supplier and maintainer of all IT equipment - in KCC's case, Northgate, which I was transferred to under TUPE from the school.

Although what with the recent culling of BSF, we are all wondering how much longer they'll (sorry, WE'LL) last with no more juicy contracts to make up for their (sorry, OUR) early loss-leading bids.

I'm not exactly privy to any kind of financial info for Northgate (I reckon I know more about RM, what with all the contacts I've built up over the years), but even a total outsider could see that cost-cutting measures are going to have to be put in place in order for them to survive - and there's likely to be redundancies in certain divisions, as pre-planning for future expansion proves to be a wasted exercise.

By bioreit on 26 Jul 2010

*sigh*

Wireless keyboards - don't ya just love 'em.

disouting = disCouNting

By bioreit on 26 Jul 2010

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