Academies should seek ESFA approval for related-party transactions, say MPs

Janet Downs's picture

MPs on the Public Accounts Committee (PAC) have long been concerned about related-party transactions between academy trusts and companies linked to trustees or their families.  Former PAC chair Margaret Hodge wanted them banned.

In a damning report on how the Department for Education (DfE) monitors academies, PAC recommends that academies should seek approval from the Education and Skills Funding Agency (ESFA) for related-party transactions.  Current rules around these transactions are ‘too week’, said MPs.

Further recommendations, described in full in Schools Week, are:

  • Trust performance should be analysed by geographic area
  • The DfE should take action when academy trust CEOs are paid more than £150k
  • The DfE must improve how it intervenes in failing trusts: uncertainty and ‘lack of up-to-date information’ didn’t inspire confidence in monitoring by ESFA
  • The DfE needs to be better at protecting academy funds and assets if a trust fails
  • The DfE must collect more data on asbestos in all school.

TYPO CORRECTION: The original artical said 'Trust performance should be analysed by geographic behaviour'.  It should have been 'geographic area'.  This has been corrected.

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