By Lucy Phillips
27 January 2011
MPs have raised serious concerns about financial and governance risks attached to the government’s new academy schools programme.
A report by the Public Accounts Committee, published today, warns that there are ‘already signs of financial and governance instability’ in the early stages of the expansion of academies – state schools that are publicly funded but independent of local authority control.
Academies were originally set up under the previous Labour government to raise educational standards in deprived areas, usually with sponsors. In May 2010, the coalition government opened up the programme to all schools.
By January 5 this year, there were 407 academies: 271 sponsored and 136 ‘converters’ – schools that are already performing well academically.
Today’s PAC report focused mainly on the performance of the sponsored academies.
Committee chair Margaret Hodge said: ‘We are concerned by the increasing risks to the financial management and governance of the academies programme if there is to be a rapid expansion of the programme as the government intends. Having two distinct strands to the programme – the sponsored academies and the new converter academies – increases the Department for Education’s challenge of ensuring sound management and accountability.’
She urged the Department for Education and the Young Person’s Learning Agency, the quango responsible for funding and monitoring academies, to force all academies, sponsored and converters, to comply with basic standards of governance and financial management.
She said: ‘The National Audit Office found that over a quarter of academies could need extra financial or managerial help to maintain long-term financial health. In these circumstances, simply issuing guidance on basic standards of accountability and financial management is simply not enough. A clear mandatory framework with strong measures to deal with non-compliance is needed.’
The PAC report also reveals that the DfE has failed to collect all the payments due from academy sponsors. Meanwhile, sponsors had yet to show any interest in running converter academies, preferring instead to focus their efforts on turning around failing schools.
On Monday, the Local Government Association warned that the government’s support for academies meant councils would lose £400m over the next two years.
