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ACADEMIES

West Midlands Regional Conference

Saturday 9th October 2010

At Dudley College of Technology Conference Suite

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PROGRAMME Welcome and Introduction Brian Patterson, Chair of DAGB Introduction to Academies David Jeffrey, Deputy Director of Academies & Free Schools Policy,

Department for Education Governors considering converting Emma Knights, Chief Executive, NGA The Legal questions Richard Freeth, Anthony Collins, Solicitors Questions Session 1 The Teachers’ Perspective Richard Hatcher, National Union of Teachers The experience of the ‘old’ Academy Chris Balderstone, E-ACT Questions Session 2 Close and Thanks Brian Patterson, Chair of DAGB

Appendix: 1. Responses to written questions post-Conference

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Introduction (Brian Patterson, Chair of DAGB, Assistant Regional Director of NGA)

This conference is one of a number of regional conferences being held this Autumn

to discuss Academies.

Members of the Directorate of Childrens’ Services and local MPs had been invited to

attend although none is present. However both Ian Austin MP (Dudley North) and

James Morris MP(Halesowen and Rowley Regis), sent their good wishes for a

successful conference.

At the DAGB Executive meeting in June the lack of understanding of academies was

a general issue, hence this conference being held, subsequently in association with

the National Governors Association.

This gives us a unique opportunity to air views and to raise questions that can be

answered by experts.

The questions we hope to address today include: “Are there only one or two issues,

or many?”, “What are the main questions?”, “Academies were originally intended for

failing schools so why the sudden change in direction in offering academy status to

outstanding schools?”, “What will be the impact on the children we are teaching and

will it benefit them?”, “What effect will the existence of an academy have on

neighbouring schools and what would be the effect on local authorities if many

schools go down this route?”. We do not expect to have all the answers today and

further issues will surely be raised during the delivery of this scheme by the

Government.

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David Jeffrey (Deputy Director of Academies & Free Schools Policy, Department for Education) Mr Jeffrey has been working on Academies and Free School Policy for over a year.

Background to academies:

Academies were launched in 2002, building on lessons learned from Fresh Start,

City Technology Colleges and international school improvement policies. These first

academies replaced weak or under-performing schools or provided schools where

extra places were needed. They were set up as all-ability, state-funded schools,

often in newly built premises.

The key features of academies

Academies are publicly-funded independent schools that give the Head Teacher,

teachers and Governing Body greater freedoms and flexibilities. They give

professionals greater scope to innovate and raise standards without losing

accountability.

They receive the same funding as maintained schools plus funding for services that

their LA would have provided i.e. they retain the percentage “top slice” taken by the

LA. They have to comply with admissions, exclusions and SEN laws and relevant

codes and they must have a broad and balanced curriculum, including English,

Maths and Science.

Staff are employed by the Academy Trust, not the LA, so nationally agreed terms

and conditions do not have to be applied. However, TUPE does apply to

predecessor school staff transferring to Academy status.

Once academy status is granted the school is run by an Academy Trust – a

charitable body – that is subject to both company and charitable law. As such, the

Trust does not own the school and cannot profit from the academy;. It has a legal

duty to act in the interests of the academy. OfSTED inspections work in exactly the

same way.

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New policy context:

A National Audit Office report confirmed that many academies

“have increased the academic attainment of their pupils

compared with their predecessor schools and are

improving more rapidly than maintained schools.”

We have learned from the best performing and fastest reforming education systems:

• Greater autonomy will be granted

• Teacher quality is critical

• Rigorous external assessment is essential.

The Government approach includes devolving power and trusting teachers and

Heads to know how to run their schools. They are also reducing bureaucracy to

make the process of conversion as simple as possible.

The Academies Act 2010 enables all schools to become academies, including

primary and special schools, although in the latter case this will not be possible until

next year. An advisory group is currently meeting to develop a model for special

schools as their admission processes are very different to mainstream schools.

The Act states that schools applying must consult “appropriate persons” but there it

will be up to the school to decide who is “appropriate”. There will no longer be a

need, however, to bring in an external sponsor in the case of “outstanding” schools.

There will be no expansion of selective admissions, but grammar and partially

selective schools may continue to be so.

There will also be different routes to Academy status. There has been an early

focus on those rated “outstanding” because they are judged best equipped to take

on academy freedoms and use them. It is also important to understand that new

Academies are expected to work with weaker schools.

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Academy status to transform weaker schools will continue but they are expected to

improve fast or have their management replaced by an academy sponsor or

outstanding school with a proven track record. There is nothing final or definitive,

however, on how best to define underperformance.

Free Schools are helping great teachers, charities and other groups to open new

academies where they are deemed necessary in terms of numbers of places or the

range of education systems available in the area.

There are four stages to applying:

• Registering an interest on-line

• Application to convert/pre-approval check – must be supported by the

Governing Body, then agreed by the Secretary of State

• Achieve funding agreement

• Pre-opening.

“Outstanding” schools applying will be issued with a named DfE contact and a

£25,000 grant is now available to schools to pay for the legal expenses.

When registering, early consultation with all stakeholders is essential as is

discussion with staff. Schools should also gather information on land ownership as

early in the process as possible. The normal approach to land/property transfer is

by way of a 125 year lease from the LA with peppercorn rent. Church schools and

PFI supported schools would have different arrangements for this.

The time frame varies but you can expect a minimum of three months from

application to opening; land and building issues are the most likely stumbling blocks

and need to be explored very early in the process.

There are currently 322 academies, 35 of which opened in October 2010.

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Emma Knights

(Chief Executive of the National Governors Association)

The National Governors Association is neutral and is helping Governing Bodies to

make a decision in the best interests of the children they are teaching and it is the

Governing Body’s sole decision whether or not to convert. A number of LAs are

suggesting that it would be easier for them if schools converted en bloc, but we must

emphasise that this is not their decision to make.

The NGA recommended application process is somewhat different to the DfEs

timetable:

• Suggest that a working group is formed to include people other than

governors, eg school business manager. It is crucial to decide how you

want your organisation to look after conversion because of the importance

of the Articles of Association. Good communication at all levels and with

all stakeholders is vital.

• Hold a single issue GB meeting or meetings. This is too big a matter to

discuss in a standard meeting and may require more than one long

discussion.

• Stakeholders should be consulted very early in the process. Who do you

have to consult? This is not specified in the Act – but we suggest parents,

staff, pupils, the LA and other schools.

• The Governing Body makes the decision.

At an Academy the job of Governor will be very similar in practice. The structure

may be very different but the business of running the school is not.

The Academy Trust is set up and delegates responsibility to the Governing Body as

set out in the Articles of Association which can be tailored to the individual needs of

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the school. The Trust then signs the funding agreement with the Secretary of State.

It is important to remember that the process can be halted by the Governing Body at

any point, including the day before opening, if there is a change of mind.

The new Governing Body must comprise at least three governors but there is no

maximum size. There can be significant flexibility in the makeup of the Governing

Body. A minimum of two parent Governors must be elected.

Does Academy Status improve teaching and learning? When academies are asked

what had they done with the “new freedoms” to improve their standards that they

could not have done as a maintained school, they found it very difficult to quantify.

Yes, old academies had new buildings but case studies available are very general in

what they say about freedom and how it is used. Given the financial situation we are

entering do Governors really want more responsibility for the school’s funding?

At the moment, we only know about funding for this academic year but the Secretary

of State made it clear that Academies will have no financial advantage over

maintained schools. The “ready reckoner” available on the website is only half the

story. It tells you what you will have coming in for this year, but you need to look at

the procurement of services and their cost. It may not be financially beneficial to

become an academy. There is no definitive list of services to buy in, but there are

many services that you will need to consider and these are not necessarily cheap,

especially as you will lose the economy of scale by going it alone. However some

schools, particularly large ones, are reporting that they will make significant profit.

Watch this space to see what further freedoms may be granted to maintained

schools!

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Richard Freeth

(Anthony Collins Solicitors)

At the risk of sounding like an advertisement, you need to get solicitors on board

early! It may seem an unnecessary cost but we are there to guide and advise you

through the whole process. We have expertise that you really will need. Okay,

advert over!

You need to consult staff and “such persons as considered fit”. There is existing

case law regarding consultation that solicitors can advise on but consultation

processes in schools are well established and timescales are already there.

If the Governing Body goes down the academy route you are, effectively, dissolving

yourself; existing governors become “shareholders” in the company. There are extra

responsibilities but otherwise the job of governor is little changed. There is

opportunity to decide what works best in the school and how to organise your

committees etc.

The Articles of Association provide a new framework within which to act.

The funding agreement is a contract between the DfE and the Academy Trust and

you will get funding based on certain principles. Staffing, curriculum, pensions etc

are in there as is accountability and financial management. It is all about running the

school and understanding what it means so you may need a more hands-on role.

Depending on the LA and their financial constraints the LA may not be there to help

you in the future.

Staff and land both transfer to the Trust. Members of the Governing Body need to

make sure they know exactly what they are getting and ensure you are not liable for

past liabilities – again, this is where solicitors will help, both with conveyancing and

the TUPE process.

Contracts and policies will also be transferred to the Trust, or can be changed

according to need. Academies are, of course, free to use new providers of services.

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By leaving the maintained sector you could be signing your own downfall, but it

could make your job as a governor more interesting and rewarding. Duties may

increase, but most will be known to you already. You will obviously need to ensure

you act within the rules of Company and Charity Law but as long as you act in good

faith and in the best interests of the school you will not be held personally

responsible. If you come across anything that is not “run of the mill”, take advice. A

Company Secretary may need to be appointed, particularly in the early stages.

Get independent legal advice, get commitment and consult with stakeholders. Will it

benefit the pupils? Only you can answer that. If you don’t think it will benefit them,

don’t do it.

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Questions Session1

Q If large amounts of funding are going direct to the school that will mean that

there is a question mark as to whether or not the LA will be able to carry out its

statutory functions if many schools convert.

A (D Jeffrey) Academies funding is on an equivalent basis but the LA will have

less money and fewer schools. The calculation will be constantly reviewed.

The Government is in the process of reviewing funding with the LAs,

academies and governing bodies. They are conscious that this is an issue. At

the “bigger picture” level the Government is looking at the future role of LAs (a

working party is doing this). Nothing has been published yet but something

may be included in the White Paper. A broad theme is looking at the LA as a

commissioner and champion for local parents and pupils, keeping hold of some

areas such as admissions but there needs to be a fair way of funding to protect

what needs to be done at the centre as well as what is going to the schools.

Q A group of four local foundation schools has formed an educational trust similar

to what has been described for academies. Is there much difference?

A (D Jeffrey) A certain amount will be the same but the distance to travel will be

smaller. Foundation schools will have already been through a lot of the

processes.

Q We have had experience recently of a large local school where the Governing

Body had disintegrated and emergency governors had been installed. They

were in deep financial difficulties but were bailed out by the LA. What would

have happened if they had been an academy?

A (D Jeffrey) The YPLA (Young Peoples’ Learning Agency) is also a body for

financial reporting and making sure financial systems are correct, ie they are in

an equivalent position to the LA. Also the Secretary of State can appoint

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governors if needed (this is outlined in the funding agreement). It is about

minimum bureaucracy and maximum control – it needs to be balanced.

Q I am a Governor at a PFI school. Does this complicate the application

process?

A (D Jeffrey) Yes! However, each case will be unique and will have to be worked

through individually. It will probably take longer but I have no real

understanding or knowledge yet of what will be involved. There will be issues,

often around liabilities and indemnities.

Q About devolving power to the trust: the concern is about accountability. If I’m

not part of the Trust, how is a governor accountable and how does someone

from the wider community exert pressure for accountability on the Governing

Body?

A (D Jeffrey) There is a range of accountabilities – to local parents by publishing

information. The government is looking at making more information available.

Governing Bodies have an important role but ultimately accountability lies with

the Secretary of State if there are difficulties.

(E Knights) Academy Trusts have accountability to communities, parents and

pupils, both legal and financial. Most duties of accountability go through the LA

for maintained schools, but to the Secretary of State for academies. In practice

in the past academies have not worked as closely with other stakeholders.

Performance needs to be reported in a meaningful way. The Government

needs to have discussions about this again: league tables are unpopular, the

report card didn’t get a consensus. So, for someone who gets the information

and doesn’t like it but is not a governor there needs to be a process for

influencing, for example a Parents’ Council, and for complaining. What the

NGA worry about is that the role of the LA having responsibility for the

education of all the children in the borough is being bypassed if academies

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become widespread. Maybe the LA should have a scrutiny rule for academies

similar to how the LA scrutinises health authorities without actually running

them.

Q In Company Law directors have liability. Does this come back to governors?

A (D Jeffrey) If they have failed in their duties, yes. But it would have to be

unbelievably bad for this to happen, such as acting unreasonably, irresponsibly

and without or against professional advice.

The Trust registers with Companies House, but has the duties of charitable

trustees. Accounts go to the YPLA not to the Charities Commission but you

can ask for advice from the Charities Commission.

Q For Voluntary Aided faith schools where land is owned by the church and the

church employs staff what would be the difference in becoming an academy?

A (D Jeffrey) I’m not an expert but individual cases would probably have to be

looked at. I would not think that ownership would be lost – it is more likely to be

leased. These kinds of issues would be addressed in the Articles of

Association. I can tell you that church school specific versions of documents

are being produced. The question has been tackled elsewhere but obviously

needs revisiting.

Q Is an academy exempt from LA reorganisation and plans for closure?

A Yes and no! – “no” if they are already an academy, “yes” if they are in the

process of becoming an academy but it would depend on negotiations between

the school and LA, with the YPLA acting for the Secretary of State. Some

schools are converting rapidly to avoid being included in reorganisations. This

is an issue for future planning strategies for LAs. .

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Q What is the position of local government if many schools convert to academies

in an area? Does this mean the loss of a layer of local representation?

A (E Knights) This is a political issue. We talk of devolution but it can also be

looked at as centralisation because the LA is being bypassed. There are

issues if LAs cannot influence schools. It goes back to the idea of scrutiny –

the LA needs to be able to say to the Secretary of State that “this is not

working, here is the evidence, what can we do?” Some LAs are proactive –

encouraging the formation of academies and rethinking their own role within the

community. This has not crystallised into a way forward.

Personnel responsibilities are also being taken on by Trusts as well as

emergency contingency funds. Insurance needs to be looked at closely as

does funding for additional services currently paid for by the LA. The NGA is

advising governing bodies to concentrate on the strategic overview.

Remember that you do not have to have expertise on everything for which you

have the responsibility; you can buy in expertise. Governors should not be

getting overly involved in personnel issues.

Conclusion: (B Patterson) It is becoming clear that governing bodies need to look

very seriously at the very large number of areas that the LA covers.

You need to be clear what you will be taking on.

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Richard Hatcher

(National Union of Teachers)

Why would a school choose to become an academy?

The NUT, along with all other school related unions, is opposed to academies. We

are not speaking just from the teachers’ point of view but with the idea of a good

school for every child. There are a number of reasons for our opposition, but

remember that schools can already change many aspects of their organisation and

curriculum delivery anyway.

In practice, academy status often results in a narrowing of the curriculum in order to

achieve the desired examination results. They are no more effective or innovative

than maintained schools and can even become less innovative once they become

academies.

In the area of admissions all schools have to adhere to the national code but there is

still leeway. We have to ask, why would a school want to control admissions?

Academy status would allow a school to be free from union agreements on pay and

conditions but I don’t believe the vast majority of heads and governors would want to

“break the unions”. If a school wants control over pay and conditions, is it to improve

or worsen them?

If you become an academy you will get a share of the LA’s topslice. We all know

that there are big cuts coming in school budgets. The LA provides a large amount of

services that would have to be purchased elsewhere by an academy and this could

prove extremely expensive.

Let me give an example. A boiler at a school I know of burst and the school faced

temporary closure. The LA stepped in and provided fan heaters. Would a private

company be able to provide the same service level as the LA at a comparable cost?

A certain amount would still be held back for statutory requirements so the academy

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would only get a percentage of the (approximately) 10% topslice. Can you afford to

buy in everything you need with that small additional money?

Academies tend to be set up at the expense of other schools, particularly poorer

schools because the proportion of money they would get would have to be reduced.

Poorer schools in deprived areas tend to get more money to help with the additional

difficulties they face. With less money in the overall pot, their money will also be

reduced.

I think it would be impossible for the LA to plan its schools places in such a

fragmented authority. What are the implications for accountability and democracy,

for example for the local community to have some say or influence on the local

school?

School union websites have lots of information on academies.

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Chris Balderstone

(Company Secretary and Director of Legal Services, E-ACT)

E-ACT runs a number of “traditional” academies around the country (11). We are a

Limited Company set up in 2008 and we are a charity (ie not for profit company).

Formerly it took up to two years to become an academy, but we are now averaging

about six months.

Our directors and trustees meet five or six times per year and the Senior

Management Team includes Legal, Human Resources, Finance, Education, IT, and

Operations Directors – approximately 30 people in all.

Our articles are more restrictive than new ones are likely to be but they do contain

useful guidance.

Typically, when we take on a new school, we take two or three existing governors

forward onto the new body and there are various local partners from education –

further education, higher education and high performing schools. A skills audit of

governors then helps decide what is needed to drive the school forward

Local accountants are important for the finance aspect. We also have architects on

three or four Governing Bodies as the old model allowed for building new schools.

There is a big emphasis on local contacts too.

The LA also puts forward governors and we have generally had a very positive

experience in this area. Our academies each have two parent governors, a teacher

and a support staff governor so we work on the principle of around eight governors

per school.

We tend to have a sort of “shadow” Governing Body that meets two or three times to

project manage the change to academy status. They then take on the governance

of the school at its opening.

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There is bespoke specialist training provided, for example on admissions and

appeals. We encourage as much training as possible and we ask our governing

bodies to perform a strategic role. I would also add that good clerking is very

important. We seek and develop high calibre chairs and governors then give them

the tools to be critical friends and to support the academy.

One thing I would say: Take governance seriously – OfSTED awaits!

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Questions Session 2

Q As E-ACT is a non-profit organisation, how does it pay for its own functions?

A (C Balderstone) We take a topslice of around 5% from the school’s budgets.

Q So, effectively, is E-ACT the “company” and the Governing Bodies committees?

A (C Balderstone) Yes.

Q “Outstanding” schools don’t need a sponsor but what would the advantage be

of having one?

A (C Balderstone) We would go through a substantial pitch, selling our vision and

ethos of the company. This centres on higher achievement and outcomes for

our pupils. This does not stop at age 16. Our academies are in very difficult

areas and we want to ensure pupils have a life that goes beyond school. We

have refined it over time and the work and thinking behind the corporate plan

has reflected this.

(R Hatcher) As a member of E-ACT or any other “chain” of academies you

would no longer be a governor in the true sense and parent and teaching staff

representation is reduced substantially. The governing body will not be making

the final strategic decision for the school – that is controlled by the Board of

Trustees and the Governing Body can only take secondary decisions.

(E Knights) Federations are another variation on a theme. This is another level

of governance that needs looking at. We have not given it enough thought as

yet. We know of some Governing Body members of individual schools who

are feeling disconnected from the Federation Governing Body. Senior

Leadership Teams of some federations are also worried about the links

between the schools in the Federation. There is a different structure from that

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of E-ACT. If you are an “outstanding” school you don’t need a sponsor and

can more or less dictate who will be on the governing body. When

“satisfactory” schools are able to convert and, possibly, “good” schools,

sponsors may be required again. You could have an informal partnership

arrangement to help with procuring for example without a formal federation.

Q Why would the Governing Body of a non-outstanding school vote to give their

autonomy to an organisation like E-ACT? If it is an outstanding school why

would they want to become companies with all its responsibilities?

A (C Balderstone) From our own experience in Sheffield the governors were part

of the drive to become an academy. But remember these were schools that

were failing and where governance was not very strong. We believe

governance does make a difference and we look for people who will bring

strengths and experiences to the governing body.

Q In difficult economic times E-ACT’s Chief Executive is the highest paid in the

country. Who decides the salaries?

A (C Balderstone) I don’t know! That would have been decided at Board level but

I suspect it was based around performance. But we have improved results

within our schools.

We transferred staff using TUPE with existing pay and conditions. This is not

likely to change in the near future.

(R Hatcher) TUPE protects the pay and conditions of staff transferring but only

for a short term. These can be changed eventually and as many academies

have a gagging order to stop staff discussing their pay and conditions it is not

likely that we will find out the consequences. It is clear that it could lead to a

two-tier pay system. The same applies for exam results – is the intake

responsible for the change rather than the academy? Your governing body

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may insist that changes do not happen but this may change in later years with a

change of personnel on governing bodies. But this is a one-way street – once

an academy, always an academy. You cannot go back to maintained status.

(E Knights) In practice pay and conditions have been maintained in most

academies. The only exception is with regard to some Head Teachers’ pay. A

small number have changed the pattern of the working year and notice periods.

The “chains” of academies have reinvented the LA model without either the

democratic or geographic model. Economies of scale for one-off academies

are not available as they are to those in “chains” so some are joining together

on an informal basis to share resources.

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Close and Thanks (Brian Patterson, Chair of DAGB, Assistant Regional Director of NGA)

On behalf of the National Governors Association and the Dudley Association of Governing Bodies: Thank you to all the speakers for their time, information, opinions; Thank you to our stewards and front of house staff; Thank you to the Executive of the DAGB and to Dudley College for hosting the event. Have a safe journey home !!

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Appendix: Post-Conference Questions

Q On the one hand we are told that Academies must adhere to the Admissions

Code and Policies but on the other hand Richard Freeth said that schools will

have to operate their own Admissions Appeals etc. How does this work in

practice?

A (Richard Freeth). In this respect Academies are no different to Voluntary

Aided or Foundation Schools. They are all admission authorities and as such

have a responsibility under education legislation (Foundation and VA

schools) and under the Funding Agreement (Academies) to comply with the

terms of the Admissions and Appeals Codes. All the Codes do is provide a

framework within which admissions and appeals operate fairly. It is up to VA,

Foundation schools and Academies to decide how they will meet their

obligations and it is possible they might decide to “buy into” LA appeals

services.

Q Does this mean that Academies can choose who they take in without

reference to catchment areas etc. How does this differ from being selective

as for example a King Edward's school is. Voluntary Aided faith schools can

operate a selection by faith. If Free schools and Academies select who they

want, what happens to the other schools in their area?

A (Richard Freeth) Academies and Free Schools cannot select by ability (like grammar schools) because they are not designated as such and only if the academy has a faith designation can they give priority to children of that faith. Academies can only operate within the framework imposed by the Admissions Code and have admission arrangements/oversubscription criteria permitted by the Code. Selection is not permitted for non-grammar schools.

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Q But isn't it true that Specialist schools can select up to 10% of their cohort. - if so does this have any bearing on your reply? A (Richard Freeth) That is a different type of selection - the grammar schools select by ability, the 10% is by aptitude and this is allowed under the Code. It begs the question how you test for it objectively, but that is not one for me to answer. I think the main point is that selection by ability is not part of the academy movement unless a grammar school converts to be an academy when its current arrangements will continue.

Q In respect of support for other schools, a requirement for Academy status:-

• Is any funding “ring-fenced” for this provision?

• How is the effectiveness to be measured? There is already an involvement through specialist school status and it is not always easy to fulfil this role – so how prescriptive are the requirements? A (David Jeffrey) No additional funding has been earmarked for supporting other schools. We want to improve standards across the education sector and to encourage school to school collaboration and sharing of good practice. We know that many effective schools are already doing this. We expect outstanding schools to agree to support a weaker school as part of their application for academy status. However, we will not be prescriptive – it will be for the converting school to decide with whom it wishes to work in collaboration or partnership and to agree with the other school(s) the form that the support will take.

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Q Financial Accountability is already provided via external auditors but currently we have the additional safeguards of an LA Audit and FMSIS inspections. Are these to be replaced for Academies?

A (David Jeffrey) Academies are on a different system of financial

accountability to LA maintained schools and as such are subject to their

own regular external audit.

Like all schools, academies are expected to maintain strict budgetary

controls and are required by their funding agreement to balance their

budgets.

The Young People’s Learning Agency (YPLA) monitors Academies’

financial position and if a deficit occurs or appears likely, the YPLA will

intervene. It will provide advice and support to the Academy to find an

appropriate solution to bring costs and income back into balance,

usually in the form of a restructuring plan, and will give additional

contingency funding if absolutely necessary.

Academies must appoint an independent external auditor to audit their statutory accounts. This main audit usually takes place every year in the autumn and the auditing arrangements have to be approved via the YPLA financial monitoring team. The YPLA can also audit the academy if

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it wishes to do so. Q I understand the limits of Directors’ responsibility for the Liabilities of the Trust – but this begs the question – who will pick up and assume those liabilities if the Trust cannot meet them? Even if Directors are personally liable what if their personal assets cannot meet the liabilities? A (Richard Freeth) If the Academy Trust became insolvent, it is likely that the Department for Education would step in to ensure the running of the school and there are mechanisms within the Funding Agreement and Memorandum & Articles of Association to allow this to happen. For directors to be liable, it would take something perverse to have occurred for them to breach their duties as directors and charity trustees especially given the safeguards in the Funding Agreement around financial matters. However, the Academy Trust (a company limited by guarantee) is a separate legal entity to the directors. Q What is, or will be, the situation regarding staff pensions? Who will be responsible? Who will pay the final pension? Who will pay in the event that there is a shortfall in funds? A (Richard Freeth) The Academy Trust is responsible under the Funding Agreement to ensure staff get access to the Teachers Pension Scheme and Local Government Pension Scheme (as appropriate). Those bodies will pay the pension. The position of the Academy Trust is explained in a guidance note on the DfE website. Q How will funding be calculated:-

• Will you use the existing (arcane and less than transparent) Local Authority

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algorithm or will you employ a new calculation?

• Will Specialist School (Technology College) funding be consolidated into the funding arrangements?

• Are Academies able to recover VAT as Foundation Schools can currently (but via the Local Authority)?

Will SEN and Free School Meals funding continue to come through the Local Authority? A (David Jeffrey) Funding is based on the level of LA funding already calculated for the school, plus additions for central services that would

normally be provided by the LA and to cover VAT. Grant payments to academies to replace LA services depend on the level of central spend in the LA, and can vary considerably from area to area. The Department has a “ready reckoner” on its website which enables schools to calculate the level of funding they should receive as an Academy, and allow them to compare this with the funding they currently receive.

• Academies currently receive specialist school funding on the same basis as maintained schools. Any changes to this type of funding will also affect academies.

• Academies are currently liable to pay VAT on supplies and services which attract VAT, but they will receive a formulaic VAT grant to compensate for this. If actual VAT costs are higher, the difference can be claimed from YPLA.

• All SEN provision would be funded by the Young People's Learning Agency (YPLA) through the General Annual Grant (GAG), except for any Individually Assigned SEN resources for named pupils - whether currently included in the

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budget share, or funded as earmarked payments or provided in teaching support – which would continue to be funded by the LA.

• The budget share includes provision for the cost of free school meals for eligible pupils, which Academies are obliged to provide.

Q I am sure that E-ACT always acts in the best interests of pupils, students, staff and the wider community – but do you think that the business model you have described is open to abuse, and what checks are in place to

detect/prevent such abuse? A (Chris Balderstone). Academy chains have a series of checks and balances in place. At a high level, we are audited by external auditors every year and our accounts are lodged with Companies House. We are subject to oversight by the Charity Commission and the Department for Education, with specific regulation and remedies for breach contained in the funding agreement and the finance handbook. E-ACT have a full schedule of Board and Board committee meetings where the business of the company is scrutinised and independent directors/trustees are able to challenge the executive team’s actions. Many powers are delegated to local governing bodies who act to assist and challenge each academy Principal and senior leadership team in a

similar manner. The multi academy model allows a strong relationship between Head Office and each academy, where good governance practice should mean that neither element can abuse the responsibilities delegated to it – and where any breach can be identified and investigated thoroughly in an open environment, then made good.

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Q If after some years an Academy decides that it wishes to revert to Maintained status, can it do so? I worry that whilst the initial Head and Governing Body might well be enthusiastic about Academy status, it might be hard to recruit replacement governors and heads because of all the additional responsibilities. A (Brian Patterson) The Trust signs a seven year contract with the DfE and

during that time it is not possible to decide to revert to maintained status. NGA attempted to secure an amendment during the passage of the Bill to allow this to be an option but it was defeated by the Government.

Because of this, it is all the more critical that, if and when the Governing Body of a school decides to apply for Academy status, they have taken the time to consider carefully all the ramifications. There is rarely any need to apply for becoming an Academy with “indecent haste” so it does make far more sense to take time over making such a decision. Above all else the Governing Body must consider what is in the best interests of the children at the school, both now and in the future.

It might be worth noting the value of SGOSS (the School Governors’ One Stop Shop) as well as the services of the Local Authority when attempting to recruit governors, whether or not the school is an Academy.

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