Small academy trust must investigate money paid to private companies

A small academy trust which is about to be wound up has been told to urgently investigate grant advances that were paid to two private companies.

St Neot’s Learning Partnership (SNLP), which runs two secondary schools and a sixth form centre in Cambridgeshire, has been warned of the Department for Education’s “concerns regarding grant advances for a 10-year period to two private companies breaching the academies financial handbook”.

The trust has received a financial notice to improve from Mike Pettifer, director of the academies and maintained schools group at the DfE, which also cites concerns about “potential conflicts of interest in recruiting staff” and “ineffective management and governance” at SNLP.

SNLP has been told it must investigate the grant advances, with independent input, by August 31, and have the scope of the investigation agreed with the Education and Skills Funding Agency.

The investigation must consider whether the payment of the grant advances “were in line with the purposes the money was intended for” when it was received by SNLP, if the trust met the ESFA’s requirements for “novel, contentious and repercussive” transactions and whether its accounting officer followed the requirements of the academies financial handbook.

It is not clear which companies received the grant advances or how much was paid.

In February, a pre-termination warning notice was issued to SNLP by the DfE, which warned the trust it faced closure over “unacceptably low” standards at Ernulf Academy and urged it to consider re-brokering the school.

A month later, the trust announced a merger with Astrea Academy Trust. Astrea is due to take over both of SNLP’s schools – Ernuf and Longsands academies –  and their staff this September.

In the financial notice to improve, sent on August 1 but published today, Pettifer said he recognised the “extensive discussions” ongoing between SNLP and Astrea about the rebrokerage of the two schools, but warned he is “concerned about the leadership and management of the trust and am not convinced that it can effectively address the issues raised with you.”

He said the notice “reflects our continued concerns regarding the governance and oversight of financial management by the board.”

As well as investigating the payment of grant advances, SNLP has been told it must “continue working with Astrea to facilitate the smooth rebrokerage of the trust’s two schools by September 1 2018, and with the ESFA for the trust’s subsequent wind up”.

If the trust does not follow the instructions given in the notice, it has been warned that the ESFA “will begin to consider and explore the contractual intervention options available”.

A spokesperson for SNLP said the trust has had a “strong and positive working relationship” with external partners including the ESFA for 18 months.

“During this time we have continued to make efficiency savings but it has proved an immense challenge due to a failing roll at one of our schools.

“To ensure we achieve the best outcomes for all our learners, the trust board decided it needed to merge with a larger trust so as to benefit from greater efficiencies.”

He added: “The ESFA are currently reviewing the grant advances and so SNLP can not make any detailed comment.

“However, SNLP is confident that the outcome of the review will confirm that the advice of the (then) Education Funding Agency was followed correctly and in line with the financial handbook.”