Why are the Conservatives intent on making every school into an academy? It’s not about standards, it’s all about the money, writes Mike Cameron.

It is becoming clear to anyone with even a passing understanding of the issues that academisation is not a universal panacea that cures all of a schools ills. The evidence we have suggests the overall performance of schools will, on average, remain unchanged. Nor, if schools follow the Department for Education’s preferred option and join a MAT, is it a creator of autonomy for those working in the school.

So it is a legitimate question to ask how did we get from the Conservative Manifesto (“So we will continue to expand academies…) to the Education White Paper (“By the end of 2022, local authorities will no longer maintain schools”) in the space of less than a year? After all, nothing of significance has changed.

If school performance isn’t the reason for making schools into academies, is it purely ideological? I don’t believe this. The prime minister has already removed the most ideological education secretary from office. The reason (given privately if not admitted publicly) was because of the adverse effect he was having on voters. This conflicted with the prime ideology of the government, which is to win elections. This is a partisan point, but not intended to be pejorative, and I don’t think you’ll find many Conservatives who disagree with it.

So why now do something purely ideological in education that is unpopular with many voters, Tory MPs and most Local Authorities?

Why now do something ideological and unpopular with many voters and Tory MPs?

I’ve heard somewhere that once you eliminate the impossible, whatever remains, no matter how improbable, must be the truth.

And the truth also explains why this measure was announced as part of the budget.

It is no secret that despite continued assurances about protected funding, schools are heading towards a financial black hole. Additional national insurance costs coming this year, additional pension costs, further national insurance increases on the way. Add those to wage and cost inflation, on top of a flat cash settlement, and it leads to a position where many schools are already through their reserves and most will start to hit negative positions next year.

Politically this is toxic. For this reason: Schools with large reserves will be okay(ish). Schools with low or no reserves will be in financial trouble very soon.

Up and down the country schools will be making staff redundant. It is already happening. It affects schools irrespective of the political colour of the local authority they operate in. It gives substance to the accusation the government have at best hid the truth about the dire school funding position and undermines the economic competence argument supporting the government.

The last decent set of figures we have for school reserves (2014) shows a total of £4.7bn held in them. £2.5bn in academies and £2.2bn in maintained schools.  As around half of academies are already in multi-academy trusts [MATs: charities with more than one school] we can take an approximation and suggest around £1.25bn of those reserves are in single academies. So a total of £3.45bn of those reserves is held in single schools. This is more than 10% of the budgets of all those schools.

The problem is that the reserves are not always in the right place. There is a fix for this problem. What if we could spread the £4.7bn around equally across all the schools? Well, theoretically the Secretary of State has powers she could use to recover these reserves and spread them around. You can just imagine the hue and cry if she tried to do so.

Schools need a bit of breathing space for the system to financially restructure (i.e. “find efficiency savings”) to prevent all the excrement hitting the rotating ventilation device. And I’m estimating it will hit it at about the same time the next leader of the Conservative party will be preparing for an election winning budget.

So what if schools could be convinced to voluntarily share reserves? What if all the schools with positive reserves could be linked to all those schools with negative reserves?

And this is exactly what a MAT does. It shares the reserves across the schools involved. It also allows for financial restructuring to take place. (Cynically, it is easier to get to reduce staffing and other costs when creating a new entity).

Putting all schools into MATs enables shared reserves and flattens out financial risk, as does movement of funding from local authorities to MATs. It reduces short-term risk of school financial failure. Moreover it does so without finance appearing to be the rationale for doing so.

Putting all schools into multi-academy trusts enables shared reserves and flattens financial risk

You will not be surprised to find I see the dead hand of the treasury behind this. You can almost hear the conversation taking place.

“Your plan already envisages that you will continue to expand academies? If you want to put off financial armageddon just set a deadline for all schools to convert, and provide a few carrots. That should get more and more of them into MATs where they can share their reserves and push the problem further down the line.”

“Ok George, we’ll do just that. You announce it.”

And that, I believe, is the real reason for forced academisation.