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Perry Beeches superhead Liam Nolan resigns



Superhead Liam Nolan has resigned from his role at Perry Beeches Academy Trust today – paving the way for the government to appoint a new interim executive board.

Nolan has also stepped down from his accounting officer role following a government probe that revealed the executive headteacher was paid a second salary of £160,000 via a private firm called Nexus Schools.

Seven directors of the trust have also resigned – announced on Companies House this week –meaning just three remain to run the trust’s five schools.

Pank Patel, regional schools commissioner for the West Midlands, is now working to appoint a new interim executive board to replace the remaining trustees, Schools Week understands.

Patel is also tasked with finding a new sponsor for the schools, based in Birmingham.

The Department for Education has been unable to secure new sponsors thus far, with some schools reportedly running a large budget deficit.

The trust’s precarious financial position was also flagged up by accountants in its most recent annual report.

Schools Week understands that some of the more financially-stable schools will likely be taken over by other academy trusts.

One of the larger and most successful academy chains with schools based in the region is Ark.

However Schools Week has been told the chain has not held any talks with the government over the Perry Beeches schools.

The remaining schools could remain in a trust together headed by a new leadership team.

The arrangement could be similar to the resolution negotiated for the Al-Madinah School in Derby after an investigation into financial irregularities. Ofsted later put the school in special measures and branded it “dysfunctional”.

In that case the chief executive of another trust, the Greenwood Dale Foundation Trust, helped form a new board at Al-Madinah, which then led it out of special measures.

While the government is finding new leadership for the schools it has “paused” the progress of two new free schools that Perry Beeches had been given approval to open.

Nolan and the trust had previously been lauded by Prime Minister David Cameron, former education secretary Michael Gove and his successor Nicky Morgan.

However the fall-out follows a government investigation into financial mismanagement at the trust, published in March, after a tip-off from a whistleblower.

The probe revealed a string of rule breaches over a £1.3 million payment made by Perry Beeches to a private firm called Nexus, which had links to the trust’s chair of directors Nicola Harris.

Schools week later revealed further connections between Harris and the director of Nexus, Robert Llewellyn.

The firm also paid a company owned by Nolan his secondary salary for providing chief executive services.

A statement released by the trust today said Nolan had stood down to “allow the necessary changes required to move the trust forward”.

“He would like it known that he has thoroughly enjoyed his time at Perry Beeches since joining in 2007 and that it has been a privilege to work alongside colleagues, families and young people in the schools.”

A further statement released to Schools Week read: “The Trust will continue to do its best at educating young people within its schools, and have not been distracted by this throughout this time. Education will always be its first priority.”

The Trust has created a new executive board which includes headteachers from all the schools to ensure no distraction from the core business of educating its pupils and helping them reach their full potential.

A spokesperson added that the trust has had no direct conversations about it being broken up.

A Department for Education spokesperson said the priority now is to ensure pupils’ education is not disrupted.

“The trust has already put in place interim governance arrangements to ensure the ongoing leadership and management of the schools are not affected.

“Pank Patel is working with the trust to secure future, permanent, governance arrangements. It would be inappropriate to discuss matters regarding the future of the trust and its schools at this stage.”

 

 



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7 Comments

  1. If a MAT takes over an Academy that has a deficit, funds from the MAT will have to be diverted to support the newly added institution. Why would it do that? As a parent of a student in the existing MAT why would I want my child to have fewer resources to enable a bale out of another school?

    When an Academy joins a MAT it gives up its legal status. If the MAT collapses, what status does an individual Academy then have? Does anyone know?

    • The EFA could fund the deficit and agree a repayment plan for all or part of the amount. Or the EFA could just agree to fund the deficit. This would be decided joining the rebrokerage process.
      All academies in MATs have no individual legal status. The MAT is a single legal entity.
      If a MAT collapses, or winds up as Prospects did, then the academies have to find another chain to join. My understanding is that the local regional schools commissioner will be involved initially but the rebrokerage fees would be negotiated with the EFA. These can range from £0 to an exceptional £7m http://schoolsweek.co.uk/two-academies-get-7m-to-go-back-to-the-wall/.

  2. Andrew Clay

    When is he to be prosecuted?
    Will the salary overpayment be paid back?
    How did auditors and the EFA allow this to happen?
    How on earth are schools allowed by the EFA to accumulate deficits?

    There some very real questions that journalists seem afraid to mention.

    • david barry

      Andrew,

      It is possible that what we have here is mismanagement, and improper financial behaviour (the double salary) but not actual fraud. But as you point out there is the matter of the deficit. It illustrates nicely one of the issues about applying market principles in this area. If Perry Beechs were truly a business it would at this stage go bankrupt and insolvency law apply. The same thing true of charities. Remember Kid’s Company? When the money supply turned off it closed.

      But of course the schools cannot be allowed to close.

      The other point is that at least part, even the large part of the deficit was not run up by dodgy payments but run up actually keeping the schools going. There also seems to have been an element of over claiming money. This means the results the schools got when compared with other schools must now be seen in the light of Perry Beech schools being vastly better funded than them, but the extra expenditure wholly unsustainable.

    • As David said, nothing actually illegal appears to have taken place. Accounts for y/e 31/8/15 show Nolan’s pay rising to £210-220k (up for £160-170k in 2013/14). That’s without the money he was paid indirectly via his company Liam Nolan Ltd. Five of six staff trustees also received pay rises of between £10-15k.
      Nolan’s niece was employed by the trust and earned £49,622 (up from £34,771). Nolan’s nephew was employed during the year at £20,600 (£0 the previous year).
      Academies are allowed to set the pay of their employees – but we can see how this freedom can be used to give pay rises which might be viewed as excessive.
      The auditors noted that Nolan had been indirectly paid via his company. They also recorded a ‘material uncertainty’ about whether the Trust would remain ‘cash positive’ to the end of December 2016 as the trustees claimed.
      The accounts also noted the EFA was reviewing Perry Beeches’ financial and governance management.
      http://www.pbat.co.uk/documents/Financial%20Statement%202015-2016.pdf

  3. I understand that these shenanigans were only revealed by a whistle-blower. Where was the Education Funding Agency?
    If the EFA doesn’t have the resources to keep a proper check on Academies and MATs, how do we know there aren’t more cases like Perry Beeches?
    I hear lots of loud clucking as Gove’s chickens come home to roost!

    • The EFA don’t have the resources and relies on whistleblowers unless the academy trust requests a bail out or if auditors ‘qualify’ the accounts.
      The Gov’t says academy trusts are audited independently. That’s true but if dodgy dealings (such as Nolan’s company) are kept off the accounts, then there’s no way the auditor would find out. In any case, auditors don’t have to judge value for money, so excessive expenditure on, say, furniture or hospitality is not censured. Neither are eye-watering salaries paid to executive principals and the like.