Doomed Schools Company Trust 'double-counted' GCSEs

A failed multi-academy trust that runs schools for vulnerable excluded pupils reported inflated GCSE results after double-counting some qualifications, it has been revealed.

Accounts of the Schools Company Trust, which will walk away from its three pupil referral units in Devon and mainstream secondary school in Kent this summer, reveal concerns over executive pay, fears for the safety of pupils and “unreliable” reporting of GCSE results.

According to the accounts, the trust reported last year that 48 per cent of pupils at North Devon Academy achieved “five GCSEs”, when the actual figure was 19.5 per cent. It is not clear from the documents whether this includes English and maths.

The results were reported incorrectly because the trust double-counted some GCSEs and counted entry level BTECs and certificates as GCSE-equivalent when they should not have been.

The results of 15 out of 41 pupils were reported inaccurately by the trust.

Similar concerns were raised at the other Devon PRUs, and as a result, all exam data across all of the trust’s academies has therefore been deemed “unreliable” because trustees “are unsure as to the integrity of the schools’ data and the reliability that can be placed on it”.

According to the trust’s accounts, which cover the period from September 1 2016 to August 31 2017, the chain is now under investigation by the Education and Skills Funding Agency over instances of potential “material irregularity, impropriety or funding non-compliance”. This “series of investigations” by officials will also cover potential conflicts of interest and related-party transactions at the trust, accounts reveal.

Trustees of the Schools Company Trust were replaced by a new board last November, and a new interim leadership team took over the running of the organisation in January of this year.

Last month, it was revealed that the trust will walk away from its PRUs Central Devon Academy, North Devon Academy and South and West Devon Academy,  and its mainstream secondary Goodwin Academy in Kent, following complaints about inadequate safeguarding and poor financial management.

A spokesperson for the Schools Company Trust said the interim trustees and chief executive “have acknowledged the unacceptable failures of financial management by previous trustees and senior leaders of the trust, and apologise unreservedly to our students, their parents and our staff.

“Working with the DfE, our new interim leadership has focused on ensuring strong safeguarding procedures and has stabilised the trust’s finances, and those of the schools, so that the transfers to new trusts are as smooth as possible.”

A spokesperson for the DfE said the “failings” at the Schools Company Trust “are totally unacceptable”.

“An investigation into the trust will be concluded shortly. However, we took swift action to rectify this including pushing for the appointment of a new CEO and board of trustees with the experience needed to rapidly improve standards,” she added.

“The four schools have already shown improvement and will soon join academy trusts with the expertise to raise standards further for pupils.”

Ex-CEO received a £35k pay rise

Elias Achilleos, the trust’s former chief executive, received a salary of between £105,000 and £110,000 last year, at least £35,000 more than the year before, when he received between £70,000 and £75,000.

Achilleos, who was replaced in February, is also the only listed director of a separate private education consultancy company, Schools Company Limited, which received payments of £19,260 from the Schools Company Trust and paid it £9,960 in 2016-17.

Heinrich Zimmerman, who was a director of the Schools Company Trust in 2016-17, was paid £25,000 for “consultancy services” that year.

Including Achilleos and Zimmerman, seven trustees received a salary, with two others paid between £75,000 and £80,000. Fifty-five per cent of the board was paid, despite a rule in the trust’s articles of association which states that no more than 33 per cent should be.

During the year, seven trustees were reimbursed for expenses totalling £57,953 – compared to £14,022 the year before.

The high number of paid directors on the trust’s board during that time meant “challenge and transparency were not sufficiently in place” to ensure rigour in the “examinations of the academies outcomes nor the trust’s financial processes”, including those in relation to procurement and the securing of best value, new trustees warned in their report.

Seven-figure school deficits revealed

Accounts show that Central Devon and South West Devon academies had deficits of £697,417 and £383,491 respectively at the end of 2016-17, although these debts are due to be cleared as part of an agreement with Devon council.

The trust has also agreed a recovery plan with the Education and Skills Funding Agency for the Goodwin Academy, which has a deficit of £1,694,128.

The Schools Company Trust received a financial notice from the Department for Education in July last year, due to “significant concerns” about finances, including “short notice and urgent requests for additional funding”.

In February, a further notice from the regional schools commissioner warned the trust may have schools removed due to a “deteriorating financial position” which meant it had “limited capability to support the academies”.

In the accounts, new trustees warned of “significant recoverable debt”, and warned the trust would have to borrow more money from the government this year.

Accounts also show SCT received £7,391 from the ESFA for bursary funds for 16-19 pupils, but only paid out £1,260 during the year.

Accounts reveal fears for pupil safety

The documents warn of “unsafe working practices” and a “lack of clarity in many transactions, including those related to some recruitment” which, in the worst cases, “could have placed some very vulnerable pupils in danger of harm”.

“Public money has been inappropriately allocated to funding a range of sites which were not only expensive but were also unfit for purpose in the delivery of a high quality education for such vulnerable pupils,” it added.

Governors in place at the North and Central Devon Academies in 2016-17 were also described as “not fit for purpose” and as making “no impact upon the pupils’ outcomes or provision”. Routine monitoring of the PRUs by Devon county council was criticised for not having “sufficient rigour”.

However, the governing board and results at the Goodwin Academy, which recently opened a new £25 million building, were praised.