After financial irregularities at one academy chain were exposed, Observer uncovers abnormal payments to trustees at another

Janet Downs's picture
Liberal Democrat MP, Ian Swales, was faced with a difficulty: how could he criticise the performance of the AET academy chain without attacking Coalition education policy? The answer: follow the complaint with a reference to the “excellent thinking” going on in the Department for Education (DfE).

Leave aside the fact that it’s the “excellent thinking” that has contributed to the current situation, Education Secretary Michael Gove replied:

“…one or two academy chains have not done everything they promised. In the case of the organisation he mentioned, we have taken steps to deal with that”.

The Academies Enterprise Trust (AET), whose performance was censured by Swales, was barred by the DfE from taking over any more schools earlier this year. AET has since denied it was banned – it says it had already agreed to stop growing when schools “in the pipeline” had converted. AET would then “pause and consolidate”.

Gove has said in the past that he wanted academy chains to grow as quickly as possible. However, this eagerness now seems irresponsible: such rapid expansion could be unwise. In January the Academies Commission expressed concern that some chains were growing too fast and some had no coherent improvement policy.

And now the Observer has discovered AET paid nearly £500,000 into the private business interests of its trustees and executives. Such payments aren’t illegal but the Education Funding Agency (EFA) has said it’s “not normal practice for charity trustees to receive remuneration.” The National Audit Office warned back in 2010 about a potential conflict of interest between academies and their sponsors when sponsors provided paid services to their academies. And warnings appeared here in March 2011 about the possible danger of academy chains operating a lucrative side line in consultancy and trading. These warnings appear to have gone unheeded.

But things must be getting serious if Michael Gove, who has previously talked up sponsored academies, now admits that “one or two” chains haven’t done what they said they would do. But an AET spokesperson told the Observer:

"The expansion of AET was at the request of the current secretary of state and his ministers.”

It appears that Gove’s encouragement was foolish. This latest scandal comes quickly after the exposure of financial irregularities at academy chain E-Act which triggered the resignation of Sir Bruce Liddington, the man who was once the most highly-pad in English education. And last year the misuse of public money by the Priory Federation of Academies Trust was referred to the police. The investigation is still ongoing.

How many similar scandals are waiting to be uncovered?


Local Schools Network published questions for Michael Gove earlier this month. Here are four which relate to academies:

1 If you believe the freedoms that academies have are valuable – such as varying their curriculum – why do you not want to extend them to all schools?

2 The Academies Commission confirmed OECD findings that schools in England already had considerable freedoms. The Commission went as far as to say that non-academies can do most things that academies can do. Why, then, do you persist in saying that the only way for schools to gain “freedom” is to convert to academy status?

3 You constantly claim that academy conversion will give schools ”freedom” from Local Authority “control” but LAs haven’t controlled schools since Local Management of Schools was introduced. How do you intend to put right this misrepresentation?

4 The Academies Commission received complaints from some heads of academies in chains that they now had less freedom than when their schools were LA maintained. What do you plan to do to address this?

The full list of questions is here.

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