Seven Financial Notices to academies issued already this year while DfE fails to submit its accounts to Parliament

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Just two months into 2016 and seven Financial Notices to Improve* have already been issued by the Education Funding Agency (EFA) to academy trusts.

The Salvatorian College and Swinton High School were found to have lost financial control.  Swinton has taken steps to reduce its budget deficit by making staff redundant and expecting a rise in pupil numbers (see 2014/15 accounts downloadable here). 

Park House School, Newbury, was in a ‘weak financial position’ and had demonstrated weak financial management.

Oldershaw Academy Trust was censured for failing to balance is budget or to ensure ‘robust financial management’.  It had requested additional financial support.

Dominic Barber Multi Academy Company, which runs seven academies, had accrued a ‘significant deficit’.

Chapel Street Community Schools Trust, which runs two sponsored academies and five free schools, had requested emergency additional funding.  This had ‘raised significant concerns’.

Bright Futures, whose lead sponsor is Altrincham Grammar School for Girls, had not balanced its budget or submitted accounts for 2014/15.  Bright Futures has nine academies including Connell Sixth Form, a free school, and Wigan UTC.

23 academy trusts, including the seven above, are subject to Financial Notices to Improve.  These include one of the largest academy chains, AET, which has also received an Ofsted letter of concern, and two academy trusts repeatedly praised by ex-Education Secretary, Michael Gove: Cuckoo Hall Academy Trust and Durand Academy Trust, whose charitable arm Durand Education Trust is being investigated by the Charities Commission.  Durand’s head, Sir Greg Martin, now retired, appeared before the Public Accounts Committee last year.  The encounter was acrimonious.

These 23 trusts represent a small proportion of all academy trusts but all academy trusts are now obliged to let the National Audit Office know if their accounts have been ‘qualified’.  Accounts are qualified when auditors have reservations about accounts.

Qualified accounts cause a problem for the Department for Education because academy accounts are consolidated into the DfE’s accounts.  The National Audit Office has given an ‘adverse opinion’ of DfE accounts for the past two years.  The January 31 deadline for submitting DfE 2014/15 accounts has gone - the deadline’s been extended to April 29.  This delay has caused Neil Carmichael, the chair of the Education Select Committee, to say this was ‘further evidence’ that DfE finances needed investigating. 

At the end of February, the National Audit Office reported on Accountability to Parliament for taxpayers’ money.  It said the ability of Accounting Officers in Government departments to ensure value for money when policies were rolled out was being outweighed by the ‘ever-increasing influence of Special Advisers’ and the growing involvement by Ministers in policy implementation.  Under such pressure, ‘considerations of value for money and public value’ float into the air, the NAO said.

The NAO’s concern combined with the DfE’s delay in submitting its accounts raise questions about the DfE’s use of public money.  As the DfE continues to throw money at academization, a probe into the way it uses taxpayers’ money is long overdue.

*downloadable here

 

 

 

 

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