Academy schools criticised over payments to board members

Report highlights ‘questionable’ practices where sponsors’ companies charge for services

Aurora Academies Trust, which runs four primary schools in East Sussex including Oakwood Primary, pays its US parent company about £100,000 a year to use its patented global curriculum

Academy schools are paying large sums of public money for “services” provided by their sponsors or individual trust board members, expert research has found.

A report commissioned by the cross-party Education Select Committee found “questionable practices” by academies were being signed off because existing rules were not strong enough.

It also highlighted potential conflicts of interest where individuals on trust boards could benefit personally or through their companies from their position.

One anonymous interviewee told the researchers about an academy “where the headteacher had spent £50,000 on a one-day training course run by their friend” – a decision which was not run past the governors.

In another academy, “the chair of governors had told all staff that if they discussed with students or used text books referencing abortion or contraception they would be dismissed”.

The researchers’ report said: “The ability of the system to pick up on intangible conflicts that do not involve money seems almost non-existent.”

The research by the University of London’s Institute of Education found that the system for guiding and regulating academies had improved since 2010, but there were still problems.

“Cases of deliberate fraud are rare and many of the instances where real or perceived conflicts have arisen are the result of people being asked to work too fast with too few controls,” the researchers said. “Nevertheless, the general sense from the literature and the evidence collected for this study is that the checks and balances on academy trusts in relation to conflicts of interest are still too weak. In the course of the research we came across a significant number of real or potential conflicts of interest that we found concerning.”

The report added: “There is a broader sense that the academy system lacks transparency and is overly politicised.”

One of the areas of concern identified was that rules governing sponsors providing paid services to their academies were “insufficiently robust”.

Sponsors providing services, such as for school improvement or office support, can charge if they are doing the work “at cost” and not for profit.

Examples of potential conflicts of interest highlighted included the Aurora Academies Trust, which runs four primary schools in East Sussex and pays its US parent company, Mosaica Education, about £100,000 a year to use its patented global curriculum.

An Aurora spokesman quoted in the report said the licence was paid at an “at cost” basis in accordance with a tripartite agreement between the trust, Mosaica and the Department for Education.

Another example cited in the report was that Academy Enterprise Trust, which runs 80 schools, has paid nearly £500,000 to private businesses owned by its trustees and executives over the past three years for services ranging from project management to HR consultancy.

The research, by Professor Toby Greany and Jean Scott, recommended that the committee should review the system of how “at cost” payments were judged. The report backed the findings of the Commons Public Accounts Committee, which included introducing a “fit and proper persons test” at individual academy and academy trust level.

The Education Select Committee’s chairman Graham Stuart said: “Academy sponsors can bring much-needed skills to schools and help raise standards. This important research has identified, however, a number of loopholes in the current arrangements that could work against the best interests of academies and their students. We will question the new Secretary of State when she gives evidence to the inquiry next month.”