NEU joins calls for probe into collapsed free schools at centre of financial scandals

Britain’s largest teaching union has joined calls for a Serious Fraud Office investigation into allegations of financial impropriety at two collapsed free schools.

National Education Union joint general secretaries Dr Mary Bousted and Kevin Courtney have written to SFO chief Lisa Osofsky to demand a probe into Collective Spirit Free School and Manchester Creative Studio School.

It follows Schools Week investigations that have shed light on £2 million of payments to companies linked to the schools’ former chief executive Raja Miah, and allegations that the former chair of directors Alun Morgan used a “false VAT number” when billing a council for consultancy services.

We revealed last week that Oldham MP Jim McMahon has also submitted evidence to the Serious Fraud Office and called for a full enquiry.

The Manchester Creative and Collective Spirit closed in 2018 and 2017 respectively, and the the Education and Skills Funding Agency (ESFA) published a report into the schools’ failings last May.

Although the report found Morgan had broken the Companies Act over payments of more than £500,000 to his own company, it was unable to reach a conclusion on other transactions as investigators encountered “substantial difficulties” establishing “any reasonable audit trail”.

The NEU said further independent inquiry is now needed after additional allegations, which were not covered in the ESFA report, came to light.

In their letter, Bousted and Courtney said: “Given the serious allegations against key personnel at these schools and the inability of the ESFA, by their own admission, to get to the bottom of this matter, we believe it is in the public interest for the SFA to step in.

“We support the request from Jim McMahon MP that the SFA should conduct its own investigation.”

A Schools Week investigation in November revealed the two schools paid more than £2 million to multiple companies linked to Miah. Morgan also had ties to some of these companies.

And last week, we revealed that Morgan Bristol Limited, which was registered to the steel fire escape door on the side of Manchester Creative Studio School, had submitted a false VAT number to Oldham Council for procurement and ICT services totalling more £220,000 over two years.

The company has never filed accounts. The council said the matter was reported to HMRC, which suffered the “financial loss”.

Both Miah and Morgan were secretly blacklisted by the government from working in schools again. However, Miah has since set up a teacher supply firm.

“Subsequent allegations and investigations by the press suggest that the scale of the alleged fraud at these schools could be far greater than the financial failings identified by the ESFA,” said Bousted, who said the public “has a right to know the full extent of what occurred and who was responsible”.

“When schools such as these fail and are closed, it is the children, their families and the staff who suffer the consequences. Local authorities are left to pick up the pieces by finding new schools for these pupils.”

“It is clear that there were failings on a grand scale at these schools yet the DfE’s own agency has been unable to uncover the full extent of these failings. It’s now time for a full and independent investigation,” said Courtney.

Both schools were rated ‘inadequate’ by Ofsted before being closed.

Inspectors said pupils’ progress in maths and English at Manchester Creative Studio was in the lowest one per cent nationally in 2016, and raised concerned that pupils at Collective Spirit were not allowed to bring lunch into school but the food served was “of such poor quality that pupils often throw their lunch away” and go to lessons “hungry”.