A government review into the Enquire Learning Trust has identified “serious weaknesses” in both its financial management and governance – with four senior leaders found being paid off payroll.
The trust, which has 27 primary academies across the north-east, Yorkshire and the Humber, and the north-west, currently employs its chief executive officer, chief finance officer, director of learning and the strategic lead for school improvement off payroll through limited companies.
An Education and Skills Funding Agency review, published today, found the CEO and director of learning were engaged through the trust’s sponsor company, Enquire Ltd, to “provide leadership, management and school improvement”.
But there was “no formal contract in place between the trust and Enquire Ltd for these services”.
The leadership services purchased from Enquire Ltd totalled nearly £1 million over five years, the report stated.
There were also no formal contracts in place for the role of accounting officer, and the report found that the off-payroll arrangements were subject to “limited oversight” by the board.
The trust was found to lack a separate finance committee, meaning that “financial oversight and management rests solely with the board” – but information was “not presented at every meeting, was not in a consistent format and lacked detail”.
The report identified a “lack of financial expertise and challenge at trustee level”, which in a multi-academy trust responsible for a total 2015/16 revenue funding of £32.6 million, was seen to represent “a significant risk for the trust”.
It added: “It also increases the chances of poor finance and governance decisions being made and not challenged or scrutinised adequately. Trustees and managers must have the skills, knowledge and experience to run the academy trust.”
The trust also incurred “high costs for hotels and overnight stays relating to school improvement and residential events”, the probe found.
Four senior management team members also held a trust credit card, despite being employed as contractors.
The review found this expenditure had been incurred without any prior authorisation. The report stated the central team could not account for a “substantial amount of spend” on the cards, as receipts had not been presented.
The probe found nearly £4,000 had been spent on the card in March last year, of which over £1,500 had no receipts.
In October of that year, over £3,300 had been spent, with £1,000 of expenditure without receipts. The government said the expenditure related to overnight stays and subsistence costs.
The trust is understood to have acknowledged that these issues needed to be urgently addressed and has set up an audit committee to working towards standardising scrutiny, and moving all senior staff on the payroll.
The trust must also undertake a full governance review, the ESFA concluded.