Trusts rocked by cyber-attacks have been barred from paying ransoms to hackers and CEO pay must now be “defensible”, new academy funding rules state.
The latest version of the academy trust handbook, released today, also states chains should hit government tech targets by 2030 and that they will no longer be slapped with notices to improve (NtIs) for educational performance.
Here’s what you need to know…
1. 2030 tech target
Last year, the handbook told trusts to “refer” to the DfE’s digital and technology standards, which “were developed to support trusts in making more informed decisions” about tech.
But now leaders “should have an understanding of the extent to which they are meeting” the standards.
They should also be “working towards meeting the following six core standards” for broadband, network switching, wireless networks, cyber security, filtering and digital leadership and governance “by 2030”.
Currently, just 16 per cent of schools meet them, government has said.
2. Executive pay must be ‘defensible’
In a letter to leaders this morning, DfE funding Andrew Thomas said the new handbook provides “greater clarity about the process for trusts determining executive pay”.
The tweaked guidance stated boards must document how they ensure their approach to CEO wages are “transparent, proportionate and defensible” in an “agreed pay policy”.
Among other things, it will include “robust decision-making that demonstrates justifiable pay” and approval by the board.
Decisions over executive salaries “may be challenged by DfE”, the new guidance adds.
This is a change from the 2024 handbook, which said “inappropriate pay and benefits can be challenged by ESFA, particularly in instances of poor financial management of the trust”.
3. Don’t pay ransomware demands
Previous guidance said trusts had to secure “permission from ESFA to pay any cyber ransom demands”. But now they’ve been told they “must not pay any cyber ransom demands”.
The updated handbook noted that such payments have “no guarantee of restoring access or services and is likely to result in repeat incidents”.
A new point added to the handbook also confirmed that the department “may recover funds where there is evidence of irregularity or fraud”.
4. No NtIs for educational performance
In prior years, trusts could be slapped with NtIs on governance grounds if board members lacked “the skills, knowledge and experience to exercise effective oversight of… performance, including educational performance”.
This has been removed from the new funding rules.
Notices can now only be issued on governance grounds if boards aren’t “properly constituted”, trustees fail to comply with “safeguarding duties” or if bosses do not “manage their school estate and maintain it in a safe working condition”.
Government has also published new guidance today covering ‘financial support and oversight for academy trusts’.
5. No news on EV schemes
A pause was placed on electric vehicle salary sacrifice schemes 12 months ago following cross-government discussions.
DfE said this would be in place while “we clarify our approach and gather data on how trusts are planning to implement them”.
Thomas revealed talks remain “ongoing. We are committed to informing you when a decision has been made and the handbook will be updated accordingly”.
6. Repercussive payments definition expanded
The handbook also expanded the definition of what constitutes a “repercussive” payment to include if it could “cause additional costs to arise for other parts of government”.
All novel, contentious and repercussive must be referred to DfE for approval before money changes hands.
It is not known what prompted this change, but some have speculated it could be linked to the ongoing teacher pensions row between the DfE and United Learning, the country’s biggest academy trust.
The trust wants to offer its teachers the option to have a less generous pension for an increased salary.
But government has opposed it amid concerns over the initial loss of revenue to the Treasury in the short-term, particularly if other schools followed suit or the proposal was introduced in other public sectors.
Your thoughts