Academies


n Ensures that the academy trust enters into a transfer agreement with the predecessor school and the local authority so that all the assets, property and records of the school are transferred to the academy trust.


n Finally, the academy trust enters into a funding agreement with the education minister.


Tell us more about those two agreements The transfer agreement will need to be negotiated with whoever currently owns the school’s assets and employs the staff. In a community school it will be the local authority but for a foundation school or a voluntary- aided school, it may be a foundation or the governors themselves. The agreement should aim to ensure that the academy trust has everything it needs to enable it to operate the academy. The funding agreement is the key document. It is signed (or becomes


effective) at the point of conversion. It is a hugely significant document because it binds the secretary of state to provide the funding and it dictates what the academy can and cannot do.


What other controls are the academy subject to? The funding agreement and the law require the academy trust to establish and operate an independent school, demonstrating “key characteristics”. Those include: n To ensure the academy is “at the heart of its community, promoting community cohesion and sharing facilities with the community”.


n To assess pupil performance and focus on pupil needs. n To observe usual admissions and exclusions policies and not to charge for admission.


n To use reasonable endeavours to obtain donations. n To designate a person with responsibility for looked-after children. n To employ only qualified teachers to prepare lessons, teach or assess pupils.


n To make special educational provision for pupils with SEN. The academy trust is not allowed to borrow without the written


consent of the secretary of state, which will only be given in limited circumstances. An overdraft facility can be used in the short-term but only with prior approval of the secretary of state and the academy trust.


How long should the conversion process take? The DfE suggests three months – in my view, six months would be a more comfortable time-frame. September 1 would be the ideal conversion date but there is no reason why a school cannot convert at any other time (even mid-term).


What if there is a budget surplus or deficit? The good news is that a local authority is obliged to pay any surplus on the predecessor’s accounts to the academy. The bad news is that any deficit is paid off by the secretary of state who will look to recover it from the academy.


Do primary academies need a specialism? No, only if the academy will provide secondary education must it have an emphasis on a particular subject area.


What about CRB checks on staff and governors? The good news is that regulations published last year indicate that existing CRB checks do not have to be redone for staff who transfer from the predecessor school to the academy.


What happens to the staff following a conversion? By law: n Every employee of the old school automatically becomes an employee of the academy.


n it is unlawful to dismiss an employee because of the transfer or to make any adverse changes to their terms and conditions (again, because of the transfer).


n The academy trust and the maintained school must consult with and inform the elected representatives of the employees as to what the transfer will mean. It is important that the governors take legal advice on this process; failure to consult properly can result in up to 13 weeks’ pay being awarded to each member of staff.


In practical terms, that means that the school will want to ensure, in


the weeks leading up to the conversion, that the staff elect representatives and then consult with those representatives.


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We have heard that there may be an issue with pensions? There should be no change for the staff. The teachers should continue in the TPS and the non-teaching staff are eligible to be members of the local government pension scheme (LGPS). Unlike the TPS, the LGPS is a funded scheme which may, at any


time, have a surplus or deficit. An academy trust is responsible for the LGPS deficit relating to eligible employees. This will be recovered from the academy over 20 years. It is therefore important for a school to understand the deficit (and this is likely to involve engaging an actuary).


What financial and accounting requirements will the academy trust have to get used to? The academy trust must: n Appoint an accounting officer. n Submit a budget before February 15 in each year (the academy’s financial year will run from September 1 to August 31).


n Prepare accounts and an annual report in compliance with those laws governing charities.


n Commission an annual audit by independent auditors.


What about clawback of surpluses? At the end of each accounting year, an academy trust can carry forward up to 12 per cent of the unspent general annual grant into a new academic year. Clearly, this is better than the current allowance.


What happens if the academy requires special measures? The secretary of state can terminate the funding agreement (and in effect bring the school back into the maintained sector) if the chief inspector determines that “special measures” are necessary or if the academy fails to satisfy the chief inspector and the secretary of state that special measures have been implemented properly.


“The good news is that a local authority is obliged to pay any surplus on the predecessor’s accounts to the academy.


The bad news is that any deficit is paid off by the secretary of state who will look to recover it from the academy”


What happens to the land used by the academy? In theory, the land should be transferred from the existing owner (whether the local authority or the governing body of the school), to the new academy. Of course, the current arrangements are unlikely to be simple and will depend on the category of school. While the particular arrangement should be negotiated with the


landowner, the secretary of state has the power to step in and order “a land scheme” if the parties are unable to reach an agreement (although he cannot direct the transfer of the freehold of trustees’ land with wholly private value against their will). In most cases the solution will be for the freehold of the land to be


transferred or a long-term lease granted for 125 years at a peppercorn rent. The governors of the academy will need professional advice from solicitors as to the title to, and risks, liabilities and restrictions inherent in, the land.


Any final advice? As a governor myself, my view is that all schools should look at the opportunity and make their own independent decision based upon what is right for their schools. In the primary sector, governors should look very carefully to check what will be the actual financial benefit and they should consider the resources (especially administrative staff) that they will need to operate an academy.


• Mark Lucas is vice-chair of governors at Moss Lane Primary School in Godalming and a partner in Barlow Robbins LLP, solicitors with a nationally recognised education practice. You can contact Mr Lucas on 01483 748512 at any time without obligation.


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