“MPs issue warning over academies governance”

By Gabriella Jozwiak

| 23 January 2019

The Department for Education must strengthen its governance of school academy trusts to prevent future damage to children's education and misuse of public money, a cross-party group of MPs has warned.

A report published by the Public Accounts Committee (PAC) found academy trusts, which account for 7,500 schools in England educating about 3.8 million pupils, were not being held to account by the DfE when failures were identified.

Academy trusts have more freedoms and responsibilities than local authority maintained schools, can determine their own curriculum, and are directly responsible for financial as well as educational performance. 

The committee said the department was not presenting enough financial information about academy trusts - often by grouping results for the trust as a whole - which had left parents unable to understand the position of individual schools

In the case of Whitehaven Academy in Cumbria, managed by Bright Tribe Trust, parents were forced to make freedom of information requests about the poor state of buildings at their school, to discover that improvement work they believed to be funded had not been done.

When serious misconduct was identified, the committee said the DfE did not have effective sanctions at its disposal.

The report stated that despite a catastrophic failure of governance, the previous executive head teacher at Durand Academy Trust in south London "is apparently entitled to a lump sum payment which, even after a statutory inquiry by the Charity Commission, totals £850,000".  

The committee also said the DfE had been unable to confirm that appropriate arrangements for complaints were in place in all academy trusts.

"Parents whose children are in stand-alone schools are more likely to feel that their views are heard than those in multi-academy trusts," the report said. 

Committee chair Meg Hillier said the government needed to "raise its game" to ensure the failures of the past were not repeated. 

"Parents and the wider community are entitled to proper access to transparent information about their local academy schools," she said.

"They must have confidence that when issues arise, robust measures are in place to deal with them.

"The government must act to make this happen and, as detailed in our report, we expect the DfE and Education and Skills Funding Agency (ESFA) to demonstrate they are doing so."

Among the recommendations in the report, the committee asked the department to include in its annual report for the academy schools sector for 2017/18 an analysis of the financial performance of academy trusts of different sizes and geographical locations, and an analysis of trends in trusts' in-year deficits as well as cumulative deficits.

It also said the DfE should ensure that all academy trusts had published complaints procedures.

In addition, they asked for the ESFA to include in the Academies Financial Handbook 2019 requirements for academy trusts to make available financial information at school level, and to be transparent about governance and decision-making at all levels of the trust. 

The report did not include any mention of local authorities' roles in supporting failing academy chains.

Local Government Association (LGA) Children and Young People Board chair Anntoinette Bramble said the findings reinforced the LGA's call for councils to be allowed to step in and oversee failing academy finances, as they do with council-maintained schools that face financial challenges.

"It is now clear that the DfE does not have effective oversight of spending in more than 7,000 academies," she said. 

"Councils, which have vast experience running large budgets, are best placed to do this. 

"Not only would this ensure democratic accountability, it would give parents the certainty and confidence in knowing that their child's school is able to deliver the best possible education and support, without risk of financial failure."

But a DfE spokeswoman rejected what she called the committee's "negative characterisation of academies".

"The majority of academies are delivering a great education and - as recognised by the Public Accounts Committee - we are taking robust action in the small minority of cases where they are not meeting the high standards expected."

The DfE quoted data that showed fewer than two per cent of academy trusts were subject to an active Financial Notice to Improve, and said 94 per cent of academy trusts were reporting a cumulative surplus or breaking even, with total surpluses of £2.4bn.

"Academies are subject to higher levels of accountability and transparency than local authority schools," the spokeswoman added.

"Academies must publish their annual accounts and this year we added new requirements on related party transactions.

"We have also taken steps to increase accountability by publishing lists of trusts who do not return accounts on time; and by challenging trusts who pay high executive salaries."

In December 2018, the Sutton Trust warned academy chains were failing to deliver their aim of improving educational achievement, after research showed disadvantaged children taught in two-thirds of academy chain schools having lower attainment levels than the mainstream school average.