EXCLUSIVE: DfE claims not to know value of free school ‘charges’

Janet Downs's picture

The Department for Education (DfE) doesn’t know the value of charges registered against free schools, Freedom of Information  has revealed.   

Legal charges are used to protect investment in a free school site to stop school trusts from selling all or part of a free school site or obtaining a loan against it without permission from the Education Secretary.

The DfE told me that no value is recorded when a legal charge is registered on the title.  This is ‘because the value of an asset will change over time.’ 

Companies House records show whether there are charges registered against any company, when the charge was created and delivered, and whether it’s outstanding.  The records will also give the name of the ‘persons entitled’ and a brief description of the property but not its value. 

For example, Company House records show the Knowledge Schools Trust, formerly the West London Free School Academies Trust (WLFSAT), has two registered charges.  One was for the freehold of Palingswick House, London.  The other was for land at the junction of Bridge Avenue and Down Place, London.  In both cases, the person entitled is the Secretary of State for Education.

WLFSAT accounts for year ending 31 August 2014 reveal the freehold land for Bridge Avenue was ‘donated’ to WLFSAT by the Education Funding Agency (now the Education and Skills Funding Agency, ESFA) ‘at a value of £9,250,000’.   

It appears, then, that land bought with taxpayers’ money was ‘donated’ to the trust behind the free school.  

It’s unclear why the Department of Education couldn’t have retained the freehold for these free schools.  Perhaps it didn’t want to add to the confusion surrounding the value of academy land and buildings held by the DfE.  The National Audit Office  (NAO) said in October 2017 there were ‘significant weaknesses’ in the processes used by the DfE to assess the value of academy land.

Whatever the reasons, it isn’t unreasonable to expect land bought by taxpayers should remain owned by taxpayers. 

But how true is it that the DfE doesn’t know the value of the charges?  Surely these relate to the value of the land when it was donated?  It’s true that land value fluctuates but the amount paid for land on purchase remains fixed.

It’s disingenuous for the DfE to claim it doesn’t know how much it paid for free school sites.  The NAO found the DfE ‘increased funding [for the free school programme] from £760 million in 2014-15 to an average of £1.4 billion between 2016-17 and 2020-21’.   Some of this is future expenditure, of course, but the NAO must have got the figures for past years from somewhere.  

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