Academy Conversion Process - FJG Academies Portal
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Academies Portal

Many schools are now considering whether to convert into a self-governing academy school. The FJG Academies Team, headed up by Senior Partner Tony Fisher, can offer advice on all aspects of the conversion and provide ongoing support. Our range of expertise and experience includes the following areas:

  • Setting up a charitable trust
  • Education
  • Employment/TUPE
  • Land/Property matters
  • General contractual issues

The FJG Academies Portal contains tailored and evolving content, collated from a variety of sources, to help you and your school move forward through the conversion process.

If you are a school considering academy status, a school already on the road to conversion, a converted academy, a sponsored academy or any other party with an interest in Academies, then please contact Penny Hepburn on 01206 835300 or via email, to find out more.

Academy Conversion Eligibility Guide For Schools

The Academies Act passed in July 2010 enables all schools to become academies. Those schools which are judged by Ofsted to be outstanding or good with outstanding features are automatically eligible to apply for academy status. All other schools are able to apply if they are in partnership with an outstanding or good (with outstanding features) school.

There are, however, issues that apply to specific types of schools converting to academy status. The aim of this guide is to provide a brief overview of these issues as they apply to four different types of schools:

Voluntary Aided Schools (VA)

VA schools are maintained by the local authority but are supported by a charitable foundation, which is usually religious in character. The governing body of a VA school employs all the staff and acts as the school’s admission authority. The land and buildings are normally owned by the foundation, although in many cases the playing fields are owned by the local authority.

The foundation appoints the majority of Governors and is also likely to have contributed financially to the costs of establishing the school and any capital projects.

Specific issues for VA schools considering conversion.

Until recently foundations were reluctant to promote and support the conversion of VA schools into academies. They were concerned that the Academies Act did not contain sufficient assurances that the religious ethos and assets of VA schools would be protected.

However, the Department for Education has recently published legal documents which have been approved by the National Society and Catholic Education Service, that provide the assurances they sought, which means that there are likely to be a significant number of VA schools acquiring academy freedoms – either as a single entity or as part of a chain or federation – in the lifetime of this Parliament.

However, there are still some specific issues which the governing bodies of VA schools need to take into account when considering conversion to academy status.

Consultation

The Academies Act 2010 requires a VA schools to obtain the consent of its foundation, before it can apply to the Department for Education to become an academy.

Governance. A maintained school has only one level of governance – the governing body. However, an academy has two levels of governance – the members of the academy trust itself and governors of the academy trust, the body which actually runs the academy.

The foundation of a VA school is likely to have a role to play in both levels of governance. The extent of the involvement the foundation has in the academy trust is likely to match the level of involvement it had when the school was local authority maintained. The precise details for each individual will need to be discussed between the foundation and the school, but in general it is expected that the foundation will appoint:

A majority of the members and A majority of the governors of the academy trust

Retaining a religious ethos at the academy

Both the governing document of the academy trust and the funding agreement have been tailored by the Department for Education, the National Society and the Catholic Education Service to ensure that the religious ethos of a VA school is protected.

In addition, provisions in the School Standards and Framework Act 1998 which affect voluntary schools in relation to reserved teachers, the religious beliefs of staff, the teaching of religious education and the requirement to provide collective acts of worship have been carried over in the funding agreement.

Land

The freehold of land held by the foundation of a VA school is not expected to transfer to the academy trust on the school’s conversion. Instead, as with community schools, a 125 year lease will be entered into by the foundation and the academy trust and the freehold ownership of the land will remain with the foundation.

Summary

The recent approval by the National Society and Catholic Education Service of the legal documents that protect the religious ethos and assets of VA schools, will lead to a significant number of VA schools converting to academy status in the next few years. However, governing bodies of VA schools considering conversion should open a dialogue with their foundations as early in the process as possible to gain the necessary consent and to identify and address potential problems prior to application.

Voluntary Controlled Schools (VC)

VC schools are similar to VA schools but differ in a number of important respects.

In a VC school it is the local authority, not the governing body, which employs the staff working at the school and controls the school’s admissions policy. The foundation supporting a VC school manages the school’s land and buildings in the same way that the foundation of a VA school does, but it will normally only appoint a minority of governors and is unlikely to have supported the school financially.

The issues facing a VC school considering conversion are the same as a VA school with the exception of the appointment of governors to the academy trust.

Whereas, the foundation of VA school will appoint the majority of the members and governors of the academy trust, a VC will only appoint a minority of the members and governors.

Trust Schools

Trust schools were enabled by the Education and Inspections Act 2006 and are maintained foundation schools with a charitable company (the trust) attached.

The governing body of the school invites individuals and organisations to form the trust, which supports the particular aim chosen by the governing body of the school.

The land and buildings are normally owned by the trust, although in many cases the playing fields are owned by the local authority. The trust does not get involved in the running of the school, which is run by the governing body, but the trust appoints either a minority or a majority of the governing body.

Trust schools are therefore able to formalise links and partnerships with individuals and organisations while still remaining within the local authority maintained sector.

Specific issues for trust schools considering conversion

Conversion is a logical next step for those trust schools which want the greater freedoms that academy status confers. However, there are some specific issues which the governing bodies of trust schools need to take into account when considering conversion to academy status.

Consultation

The Academies Act 2010 requires trust schools to obtain the consent of the trust as the owner of the schools land and assets before the school can apply to the Department for Education to become an academy. If the trust refuses to give its consent, the school can go through a consultation process to withdraw from the trust and revert to being a foundation school and then apply to become an academy. Usually it will be possible to run both the consultation on withdrawing from the trust and converting to academy status simultaneously.

Conversion process

Although trust schools already have a charitable company which is very similar to an academy trust, it is not possible to convert this trust into the academy trust.

In the case of trusts which support just one school, the school can go through the conversion process to become an academy with their trust attached. Once the school becomes an academy, the trust would no longer be able to support the school. This is because trusts set up under the trust school legislation can only support maintained schools and not academies. The trustees of the trust would therefore be expected to wind-up the trust, leaving the school as an academy.

In the case of shared trusts which serve several schools, the above would still apply with the exception that the trust would not be wound up but would continue to support any remaining maintained schools. It could not however continue to support any of the schools within the trust that become academies.

Dealing with existing trust partners

Trust schools will need to consider how to deal with their existing trust partners (i.e. those individuals and organisations who are currently involved in the trust). Some trust partners may wish to be involved in the new academy (either as members or governors), while others may not. It is important to consult all existing partners and explain the new roles and responsibilities that will result from an academy trust.

Land

On conversion to academy status, the secretary of state makes an order transferring the land and buildings of the school held on trust by the trust to the academy trust. For those schools which have not yet had their land transferred to the trust, negotiating with the local authority may cause a delay but will not prevent the conversion.

Summary

Many trust schools have registered an interest in becoming academies and their current status is not a barrier. However, governing bodies of trust schools considering conversion should open a dialogue with their trusts as early in the process as possible to gain the necessary consent and to identify and address potential problems prior to application.

PFI Schools

A PFI school is subject to a private finance initiative contract with a private sector contractor.

In a PFI school, the contractor charges a monthly fee and has responsibility for constructing new school premises and/or refurbishing existing ones. The contractor also provides a range of facilities management services including cleaning, catering and maintenance.

A PFI contract usually lasts 25 years and, at the end of the contract, the buildings built by the contractor are transferred back to the local authority, trustees or governing body, depending on the type of school.

Specific issues for PFI schools considering conversion

PFI schools have a governing body agreement with the local authority. This allocates certain rights and responsibilities to the governing body. The governing body agreement ensures that the governing body of the school is bound into the PFI for the full 25 year term. Because of this, conversion to academy status does not offer PFI schools an opportunity to extricate themselves from existing PFI contracts.

The Department for Education has stated it has no intention of buying out schools from PFI deals; it has also clearly stated that PFI contracts will not be barriers for schools wishing to convert to academy status. The Department for Education’s proposal is that, as part of the conversion process, the PFI school will enter into a new school agreement with the local authority. Under this agreement, the academy will commit to meet its PFI obligations and will continue to receive the services it is entitled to under the PFI. The Department for Education accepts that the school may have to carry out further due diligence and will offer additional funding for this.

The funding agreement for the school will allocate financial risk to the school where it fails to comply with its PFI obligations and where this results in a cost to the local authority. The Department for Education recognises that local authorities may be concerned about the increased risk of contracting with an independent academy trust, and therefore offers an indemnity to the local authority which guarantees that its liabilities are not increased by the decision of the PFI school to become an academy. The Department for Education will also consider annual grant funding requests from an academy where it can show that its continued involvement in the PFI scheme has led to increased costs.

Given all of this, it is clear that financial risk of a PFI school which previously sat with the local authority is borne to a much greater extent by The Department for Education. Therefore, the business case underpinning academy conversion applications from PFI schools is likely to be scrutinised much more carefully than for other types of schools.

Conversion process

Given the potential complexities it is likely that the process of converting into an academy will take longer for a PFI school than for other types of schools. However, assuming the additional complexities are addressed and the financial consequences of ongoing PFI commitments are taken into account, there is no reason in principle that prevents a PFI school from converting to an academy.

Please contact Penny Hepburn on 01206 835300 or via email phepburn@fjg.co.uk to find out more.

Free Schools

In September 2011 the first Free Schools will open in England. Thirteen free schools have had their funding agreements signed by the Secretary of State for Education and a further seventeen have had their business cases approved and are in the pre-opening phase.

Inspired by charter schools in the US and the Free School movement in Sweden, the Coalition Government launched their Free Schools programme soon after it came to power in June 2010.

Free Schools are a type of academy and operate independently of Local Authority control. They are funded in the same way as other academies; by the state on a per pupil basis. The key difference between a Free School and a Converter Academy is that the former is a new school which is set up in response to parental demand.

Proposals to set up Free Schools have been received from a wide range of groups: charities, universities, businesses (on a not-for-profit basis), education groups, independent schools, faith groups, teachers and parents.

Click here to see locations of the first free schools to have signed funding agreements and those that are in the pre-opening phase.

View the Department for Schools Free School Kit

Teaching Schools

The Government has recently outlined plans to raise standards and improve the quality of teaching and school leadership through school-to-school support and peer-to-peer learning.

A key part of these plans will be a nationwide network of teaching schools.

What are Teaching Schools?

Teaching Schools will be outstanding schools that take the lead in supporting and assuring initial teacher training and professional and leadership development for teachers and leaders in their area.

It is envisaged that teaching schools will do three things:

  • Provide support for trainee teachers, leaders and other colleagues in schools by working as part of a partnership.
  • Provide support for schools that are facing challenging circumstances.
  • Create a network of schools that work in partnership to deliver both these agendas. So as well as offering support
  • themselves, teaching schools will identify, develop and co-ordinate expertise in other schools for the benefit of all pupils in their area.

Teaching school designation will be open to all schools in England (including primary, secondary, special, independent and recent academy converters) that:

  • have a significant track record of successful collaborative relationships with partner schools
  • have an Ofsted rating of outstanding for overall effectiveness, teaching and learning, and leadership and management
  • show consistently high levels of pupil performance or continued improvement
  • have the proven capacity within their school to provide support and development to other schools
  • have demonstrated a strong contribution to the delivery of high quality initial teacher training, professional/leadership development and school-to-school support

It is likely that there will be about 500 teaching schools by 2015.

Prioritising applications for teaching schools

In the event of too many applications, then schools will be selected on a fair and transparent process which is likely to take account of the following:

  • the identified demand for school-to-school support in a given area and the level of support already being provided
  • the numbers of other teaching schools in the same phase in any given area
  • the number of schools already engaged in meaningful partnership with the applying schools
  • other factors, such as:
  • the areas of expertise a school may offer if it meets an identified need
  • the need to support schools in challenging circumstances
  • the potential to build a local teaching school network

Pilot Teaching Schools Programme
There are currently 28 teaching schools (including primary, secondary and special schools) in 3 pilot areas – London, Greater Manchester and the Black Country. A further 23 are scheduled to be designated as teaching schools in the near future.

There are also over 240 training schools in operation across England which have developed professional development and ITT in their local areas and provide high quality, high volume school-led initial teacher training. There are also a number of leadership partner schools that have been designated as part of the High Performing Specialist Schools programme.

Teaching school clusters
Small groups of schools will be able to apply for teaching school designation together, so long as each individual school meets the criteria. This may include cross-phase teaching schools (which may include an outstanding special school). However, the funding for joint applications will be the same as for a single teaching school, so the funding will need to be shared according to the roles taken by each school in the partnership.

Funding

The level of funding for teaching schools has yet to be confirmed but they will receive funding for their core role and they will also be paid to deliver activity such as initial teacher training, CPD, middle leadership development and specific school-to-school support.

It is expected that teaching schools will gradually develop more and more of their own income as their local partnerships develop. Teaching schools will primarily be accountable to their peers, as other schools will choose whether or not to take advantage of the provision and support that they offer.

Teaching schools and universities The Department for Education expects all teaching schools will have strong links with at least one university partner to support their work. The Government White Paper ‘The Importance of Teaching’ draws an analogy with teaching hospitals and it is anticipated that teaching schools and universities will work together to deliver accredited ITT Masters-level work and practice-based research, for instance through secondments and formal and informal sharing of staff. You can find further detailed information on Teaching Schools on the Department for Education website at www.education.gov.uk or by visiting www.nationalcollege.org.uk/teachingschools

A Guide to Good Governance

The governing body of an academy trust is ultimately responsible for the governance of an academy, for safeguarding its assets and ensuring that it is run in the most efficient and effective manner.

It is extremely important that all trustees are fully aware of their responsibilities and understand the steps they need to take to ensure that the academy trust is properly governed. This paper outlines the key areas that trustees should focus on to ensure that their academy follows best governance practice. More detailed information can be found on the Department for Education website by following this link: www.education.gov.uk

Mix of experience and skills

The governing body (board) should take collective responsibility for all decisions and be involved in setting the strategic direction of the academy.

It is important therefore that there is the right number of trustees on the board. If there are too many trustees, it can impact on the board’s ability to make effective and timely decisions; too few and the board may lack the breadth of skills and experience required.

We recommend that you use a simple matrix to plot the existing range of skills and experience on the board so you can identify any significant gaps.

Every trustee needs to be properly inducted, trained and developed. Before new trustees join they should receive a full information pack which will include as a minimum:

  • the current governing document / funding agreement
  • strategic and shorter term plans
  • current management accounts
  • recent board minutes
  • CV of current board members
  • an organisation chart
  • general background information

Roles and responsibilities

It is very important that it is clearly explained to every trustee what their role, responsibilities and legal obligations are, and the amount of time and commitment they will be expected to give to the board.

A number of trustees will have specific functions which need to be clearly documented and understood. Where tasks are delegated there must be a clear process for monitoring the outcomes.

Clear strategic direction

An effective board understands the interests of all stakeholders and gives them the opportunity to voice their views. There may well be conflicting demands between stakeholders and it is important to consider how these can be managed to the overall benefit of the academy. For example:

The academy’s objectives should be translated into a clear and understandable vision. Specific shorter term objectives should be identified that will deliver the vision in practical terms. And there must be a process in place which allows the governing body to measure progress towards meeting these objectives.

Public benefit is an extremely important consideration and it is critical that trustees understand what is required and that public benefit activities are closely aligned with the objectives set out in the academy’s funding agreement.

Formal written policies need to be place covering key aspects of the academy’s operations. Areas to consider should include: internal financial procedures, financial reporting, accounting, reserves, investment; staffing and HR matters; SEN; health and safety; complaints and grievance procedures (internal and external); data protection; equal opportunities, environmental matters; communication and confidentiality; disaster recovery; risk management; conflicts of interest; intellectual property.

Integrity and objectivity

Trustees have a duty to ensure that the academy always acts within the objectives laid down in its governing document and to consider the interests of the academy as opposed to any personal benefit. It can be easy to drift away from defined objectives where activities develop over time so the governing document should be regularly revisited to ensure current activities fall within the defined objectives.

Each trustee must understand the consequences of and the extent of their liabilities in law for wrongful acts. A register of interests must be regularly updated and all trustees should be asked for actual/potential interests to be declared at the start of each board meeting.

The overriding principle is that trustees act in a voluntary and therefore unpaid capacity. Trustees may only be paid for serving as a trustee where this is clearly in the interests of the academy trust and provides a significant and clear advantage over all other options. Payments made to trustees for services rendered in a capacity other than as a trustee must be in accordance with Charity Commission guidance and provided there is no express exclusion of such payments in the trust’s governing document. There must also be a written agreement covering the contract terms.

Consider how the long and short term outcomes of planned actions might impact on the reputation of the academy both internally amongst its staff as well as externally. This is particularly important to consider when working in partnership with outside bodies where there may be influences which are outside the academy’s direct control.

Openness and accountability

An effective board communicates regularly and openly with all stakeholders. The short and long term objectives (and progress towards meeting them) should be clearly articulated and there should be opportunity for all stakeholders to provide their feedback.

The annual trustee report should be used to explain the impact and outcomes of the year’s work, linking this to targets set at the start of the year and future plans.

Financial prudence

The board must be fully involved in setting and approving plans and financial budgets and targets. All trustees will require regular reports detailing the current financial position of the academy and its future sustainability. As a minimum the trustee board must set and understand the policies in place for managing the academy trust’s investments, reserves and borrowing, even where these tasks are delegated on a day-to-day basis to a subcommittee or to third parties, such as investment fund managers.

There must be a clear understanding of the academy trust’s attitude to and acceptance of risk. Risk management should form an integral part of strategic planning. Risks must be assessed in the light of the academy’s ability to absorb and manage them. This may be affected by internal circumstances such as staff skills and available financial resources or by external factors such as the impact of changing government policy on the funding environment. ‘Risk mapping’ should be used to analyse specific risks in terms of likely occurrence and severity of impact and a risk register maintained, which needs to be regularly reviewed in the light of changing circumstances and influences.

Conclusion

Good governance practice will provide several significant benefits.

  • It brings an understanding of the risks and opportunities that the academy faces both now and in the future, which in turn ensures that opportunities can be taken advantage of, within defined operating constraints.
  • It ensures that robust decisions will be made, based on sound and meaningful information.
  • Outputs and outcomes will be clearly measured and used as a means of improving future performance and in meeting the needs of beneficiaries.
  • There should be a positive impact on reputation and relationships both within the charity and with external stakeholders.

We are able to provide forms and templates to ensure that your academy follows best practice, please contact us on 01206 835230 to find out more.

Academy Conversion as Part of a Chain

The next wave of schools converting into academies will include many which choose to do so as part of a chain. This is because there are likely to be significantly more primary schools and Church schools opting for academy status in the next couple of years.

There are three options for schools considering conversion as part of a chain.

  1. A Multi-Academy Trust is the term to describe an organisation with a single shared governing body which governs more than one school.
  2. An Umbrella Trust is a partnership between schools in which each have their own governing body. It is possible for different types of schools (i.e. community, voluntary aided, voluntary controlled and foundation) to collaborate together in an Umbrella Trust.
  3. A Collaborative Partnership is the most informal grouping and allows schools to work together without being formally accountable to other schools in the chain.

The Government is keen to encourage chains because they regard this collaboration between local schools as the key factor in a sustained improvement in school performance – particularly for ‘weaker’ schools in the chain.

Each school in a chain (irrespective of whether they are entering a Multi-Academy Trust, an Umbrella Trust or a Collaborative Partnership), will be entitled to a grant of £25,000 from the Department for Education to help with conversion costs. The grants can be pooled to support the whole chain, although they don’t have to be.

Model documents for schools converting as single academies and for schools converting as a multi-academy trust can be accessed by clicking here

If you would like to discuss any aspect of being part of a chain of academies, please contact our team on 01206 835230.

Multi-Academy Trust

diagram_multi_academy_trust

Umbrella Trust

diagram_umbrella_trust

Collaborative Partnership

diagram_collaborative_partnership

Pension Advice for Teachers

Maintained school staff will be members of either the Teachers Pension Scheme (TPS) or the Local Government Pension Scheme (LGPS).

The Local Authority is the administrator in the case of the LGPS and collects and pays employer and employee contributions for both schemes. The Local Authority also submits an annual return of service for the TPS. These are ’employer’ responsibilities.

Teachers’ Pensions

For the Teachers Pension Scheme conversion to an academy is relatively straightforward. Decisions associated with management of the scheme are taken by Parliament and therefore are the same whether it is the Local Authority or the Academy employing the teacher. The difference is that an Academy will be required to undertake the employer responsibilities for making payments and data transfers as required by the scheme.

Support Staff Pensions

Schools becoming Academies will need to register with LGPS to be a scheduled body employer (not an admitted body) and take on the responsibilities for payments, year-end certification and data transfers for themselves. Where maintained schools apply to convert to academies existing staff who are already members of the LGPS by virtue of the Administration Regulations would not be affected by the conversion.

Their membership of the LGPS would continue unaffected. After conversion, new non-teaching staff will be eligible to join the LGPS and will be automatically enrolled in the scheme when employed, as long as their contract of employment is for 3 months or more but will have the option to opt out of the scheme if he or she gives notice within three months. It is also open to an Academy to pay contributions into private pension schemes, but this normally happens only if an Academy was previously an independent school and some staff wish to remain in the private scheme. The Academy cannot do this as an alternative to the LGPS and all the non-teaching staff have the right of entry to the LGPS.

Risks to an Academy

For the Teachers Pension Scheme, this is restricted to ensuring that payments and other administrative functions are made as required. The scheme can levy interest on late payments and an Academy is required to understand its responsibilities and meet them in a timely manner.

But for the Local Government Pension Scheme (for non teaching staff), the academy becomes a scheduled employing body of the LGPS whereupon the administering authority should be asked for a calculation of the employer contribution rate for the Academy. The actuarial assessment will be done by the LGPS administering authority’s fund actuary but the school may wish to have their own assessment performed by an independent actuary. The employer contribution rate will be calculated on the basis of the academy’s staff profile and relates only to the Academy, whereas nearly all maintained schools in Local Authority pay the same pooled rate. This means the rate can be higher than the rate which applied to the school when it was maintained by the Local Authority. There is likely to be a charge for the actuarial calculation.

Unlike the TPS, the LGPS is a funded scheme and can be in surplus or deficit according to investment performance. Most pension funds are currently managing a deficit, and the deficit in respect of pensionable service prior to conversion transfers from the Local Authority to the Academy through the transfer agreement signed prior to conversion. The actuarial calculation of the employer contribution rate will take into account the amount needed to pay off any past service deficit and meet future accruals over a specified period, which is normally taken to be 20 years for Academies, although it is for the actuary to take a view on this.

Whatever arrangements apply currently for remitting contributions as a maintained school, the Academy will itself be responsible for remitting employer and employee contributions to the administering authority, although a payroll provider may do this on its behalf. If there is a deficit in the relevant pension fund, the Charities Statement of Recommended Practice (SORP) requires that the Academy’s statutory accounts show the deficit as a liability in the balance sheet. The total deficit can be substantial. However, the Charity Commission has advised that this liability, even if it exceeds the academy’s assets, does not mean that the academy is trading while insolvent, because the deficit is being reduced by the contributions made, using the grant payable to the academy.

When a school is converting, it is therefore vital to obtain details of the administering authority contacts as quickly as possible (usually from the HR/pay department of the Local Authority), to ensure that staffing information required by the administering authority’s actuary can be supplied by the school or the maintaining authority, and to ensure that the implications for the Academy have been fully discussed with the administering authority. The Department for Communities and Local Government (CLG) are currently preparing further advice and this will be provided as soon as it becomes available.

We would be delighted to discuss the legal aspects of your particular pensions situation in more detail. Please call us on 01206 835230 to arrange for an informal, no obligation discussion. Please note that we are not authorised to give financial advice on the performance of any particular scheme, and we will only advise on the legal responsibilities you will have in relation to the School’s pension schemes and the practical implications of the transfer.

The aim of this page is to provide brief answers to the questions most commonly asked by heads and governors considering whether their school should become an academy.

It is only a guide and is not a substitute for the professional advice a school should take before registering their interest with the Department for Education.

Further advice is available from the Department for Education website

What are the key steps in the conversion process?

There are 3 key steps as outlined in the chart below:

diagram_academies_stages

How long does the process take?

The process – from the school first registering an interest with the DfE to opening as an academy – will normally take about 3 months. However, the process can take longer if there are complex property and employment issues to be resolved.

Which schools can become academies?

All schools judged by Ofsted to be outstanding or to be good with outstanding features are automatically eligible to become academies.

All other schools can become academies if they work in partnership with a school that is automatically eligible. Outstanding schools are expected to enter into some form of collaboration with at least one other school to help tackle that school’s underperformance. Funding agreements for new academies will include a requirement to promote “community cohesion”.

Do we need to consult before we register an interest with the DfE?

The governing body determines whether the school should apply for academy status and there is a statutory requirement upon them to consult with “appropriate persons” which might include parents, staff, pupils and the local authority. If your school is a church school, you must gain the consent of the school’s foundation.

What changes will there be for the governing body?

The governing body will be dissolved when the school becomes an academy and a new governing body will be established by the academy trust. The new governing body will have to include at least two parent governors. Members of staff can make up no more than a third of the governing body and there can be no more than one governor from the local authority.

Will staff transfer to the academy?

Yes. All existing staff will transfer under TUPE regulations.

Will there be greater flexibility to reward staff?

Yes. The governing body can set its own pay and conditions but staff who transfer do so with their existing terms and conditions.

How does the funding work?

The funding will continue on per pupil basis and new academies will be able to claim a share of the money that is currently held centrally by the local authority. The amount each academy receives from the local authority ‘pot’ can vary considerably from one local authority to another.

Academies will be able to apply for capital funding from the government as before.

Academies will be able to reclaim VAT on all (non-business) costs related to providing free education. This will put academies on the same footing as maintained schools whose VAT is recovered by the local authority. Schools are eligible for a grant of £25,000 to help with conversion costs.

How much influence does the local authority have?

The local authority has no power to intervene in the process. However, the school can still buy services – eg. energy, banking and insurance – from the local authority once it becomes an academy but will be under no obligation to do so.

What accounts will the academy have to produce?

An academy will be required to produce accounts that comply with the Companies Act and comply with charity and company law. The accounts will normally be for an accounting period ending August 31st. The Academies Financial Handbook contains a sample set of accounts.

What is the position regarding surpluses and deficits?

Any surplus or deficit has to be agreed before the school becomes an academy.

Academies are not allowed to run a deficit. Any academy that opens with a transferred deficit will need to have a plan agreed with the Young People’s Learning Agency (YPLA) to repay the deficit from its annual grant.

If an academy does develop a deficit after it has opened it will be required to agree a restructuring plan with the YPLA.

Can the academy return to local authority control?

No. Once a school has become an academy, it is not possible to go back to maintained / voluntary status.

What Responsibilities do academies take over from the Local Authority?

The major responsibilities will include:

School business:

  • Admissions – ensuring compliance with admissions legislation and guidance
  • Premises – health and safety, capital building support, details of construction industry law.
  • Purchasing – ensuring compliance with EU purchasing law and tendering processes, and achieving best value through competitive tendering.
  • Employment – negotiations with Trade Unions and staff if changing staff terms and conditions.
  • Training for staff and Governors on all aspects of school management including safeguarding and legal responsibilities
  • Payroll and pensions responsibilities.
  • Policies regarding, for example, a vision for the academy, HR policies and procedures including discipline and grievance and others covering all aspects of employment (which have to be agreed with the Trade Unions), behaviour (pupil and staff), staff performance, health and safety and bullying.

Financial activities:

  • Legislation and standards governing statutory company and charity accounts. This includes production of full statutory accounts including income and expenditure accounts, a statement of financial analysis, a balance sheet and all required notes and other regular detailed income and expenditure returns. These accounts will need to be independently audited. Additionally there are responsibilities for accounting for fixed assets and management of VAT directly to HMRC; registration and administration of pensions for both teachErs and non teaching staff; along with regular and often more rigorous challenge of financial matters by Governors

Legal:

  • In a maintained school, ultimate legal responsibility rests with the LA, whereas academies bear the risk themselves.
  • The risks which will need to be insured against and include, for example, employment risks (tribunals, costs of dismissal /retirement /redundancy, tax liabilities), generally insurable risks (buildings and contents, professional and personal liabilities, liabilities for children and staff in School and out of school on school/educational activities).

Key responsibilities of the academies trust will be to:

  • Ensure the quality of educational provision
  • Challenge and monitor the performance of the Academy – areas of challenge will include curriculum, assessment and attainment, behaviour and attendance, views of the school and the community, staffing and budget
  • Appoint the Principal
  • Manage the Academy Trust’s finances and property
  • Fulfil the role of critical friend
  • Employ staff
  • Approve the Academy formal budget plan each Academy Financial year (Sept – August).
  • Comply with (and ensure that the Academy Trust complies with) both charity and company law
  • Manage and comply with the obligations in the Funding Agreement – upholding admissions arrangements and arrangements for pupils with SEN, provision of free school meals, ensure a broad and balanced curriculum that includes English, maths, science and RE.
  • Determine their own admissions policy and arrangements although participation in the LA co-ordinated schemes is still required.
  • Administer their own school admissions appeals.

The Local Authority retains responsibility for:

  • Home to school transport (including SEN)
  • Education psychology,
  • SEN Statutory Assessments and Statements
  • Monitoring of SEN provision, parent partnership service, etc
  • Prosecution of parents for non-attendance
  • Individually assigned SEN resources for pupils with rare conditions needing expensive tailored provision.
  • Provision of pupil referral units or education otherwise for a pupil who is no longer registered at an academy
  • Co-ordinating admission arrangements.

If you are thinking about converting to an academy and would like to discuss any of the issues informally, please call our team on 01206 835300.