Police investigate lost £162,000 at academy school

The Independent is reporting that police are investigating allegations of serious financial mismanagement at an academy school, fuelling demands for stricter controls over their financing…

Officials from the Education Funding Agency, which oversees the funding of free schools and academies, are seeking to recover at least £162,000 claimed to have been misspent by Glendene Arts Academy, a specialist visual arts academy for pupils with special needs in Easington Colliery, Co Durham.

A Department for Education (DfE) investigation report followed an inspection by auditors last year, prompted by whistle-blower claims over the use of academy resources to pay the salaries of employees as well as the running costs of a private company. The report, which was dated November 2013, was published only last Friday…

The investigation into Glendene Arts Academy revealed that the unnamed private company financed by the school – and set up when it was still maintained by the local authority – was meant to help in fund-raising and training as well as providing an annual dividend. However, a heavily redacted report by the Education Funding Agency said: “We cannot identify any discernible benefit for the academy in this arrangement: it has resulted in the loss of £162,000 that should have been used for the benefit of academy pupils.”

A number of staff have been suspended, although the report did not say who. Auditors concluded that the majority of the costs incurred since the school became an academy in 2012 went on staff salaries and expenses, while £718 was spent on mobile phones and £3,430 on the cost of supply cover. The equivalent of £4,326 was spent on “principal’s meetings” away from the academy.

The report said that four members of staff had been working for the company. It also found examples of possible “irregular” expenditure, including £289.94 used to purchase bucks fizz for the official opening by the Duke of Edinburgh in 2013. Concerns were raised by the EFA over the academy’s procurement policies and the use of emergency powers. No one was available for comment at the academy.

In a statement, the DfE said the financial accountability systems of academies and free schools were more rigorous than for those maintained by local authorities…

Mr Gove has outlined plans for the appointment of eight regional commissioners who would help raise standards and check on their performance.

More at: Police investigate lost £162,000 at academy school

It’s not that clear from the report what exactly seems to have happened here and in what ways money may have actually been misspent. Is it normal that a school would set up a private company like this (which was apparently done before it became an academy)? Do you think this an academy-specific issue or might all schools benefit from clearer guidelines about accountability and spending? Please let us know in the comments or via Twitter…

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Categories: Academies.

Comments

  1. Janet2

    It’s not unusual for schools to set up companies to handle funds coming into the school for running, say, a nursery, or selling consultancies to other schools.  These are usually private companies limited by guarantee without share capital.  That means there are no shareholders to take a cut and any profit is supposed to be ploughed back into the school.

    For example, Durand School (now academy) set  up London Horizons way back in 1997.

    http://www.theguardian.com/society/2005/jun/28/children.schools

  2. mattpearson

    ‘Misspent’ is the phrase used. But this is public money, if it has been misspent, then it’s been stolen surely. Enough with the euphemisms, tell it like it is.  And another thing, why would a school shell out 700 quid for mobile phones? What possible reason could it give for this?

  3. kayajs24

    SchoolsImprove Not the first school to have a similar issue. Another flagship academy was investigated a couple of years ago (my old sch.)

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