Northamptonshire-based academy chain criticised in financial review

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A financial review of an academy chain based in Northamptonshire has found a series of “highly unusual” practices by the board of trustees.

In a report published by The Education Funding Agency, a number of concerns were raised about the financial management of the county-based Education Fellowship Trust.

The trust, which sponsors Blackthorn and Thorplands Primary Schools in Northampton, was found to have made a number of appointments of head office personnel who were family members of senior members of staff.

In one case, the director of communications, at a salary of £70,000 per year plus benefits, was appointed when there had been no advertising or competition for the post.

On another occasion an administrative support worker, on an estimated wage of £22,000, was appointed following no advertising or competition for the post despite the fact it was her first employment after leaving university.

The report stated that the chairman of the trust was paid more than £90,000 in respect of his role as chairman, but apparently not as a trustee. This was in breach of the trust’s governance guidelines.

It was also found that the personnel file for the chairman, who was formerly the CEO, did not contain a contract of employment, a job description, a role description, confirmation of what his new job role was or confirmation of the salary for the new role.

There was also a number of related party transactions with companies in which the chairman had a controlling interest.

The report found that two governors had received expenses of £45,000 in 2012/13 and there were “very high levels of private car usage, travel and subsistence and accommodation costs incurred for business travel”.

A list of “irregular and improper” expenditure was identified including the purchase of 350 trust Christmas cards with a tailored design at a cost of £1,000.

The Education Funding Agency said it had now served the trust with a written notice to improve financial management, control and governance and the agency will now 
“monitor its progress” towards meeting 26 recommendations for improvement by the board.

In response to the review, the Education Fellowship Trust said that “significant structural changes” had been made since the period covered by the report, which was up to August 31, 2013.

A trust spokesman said: “The EFA are very clear that all issues found are from pre-September, before significant structural changes were made and Johnson Kane was appointed as CEO. The Fellowship had already commenced on a change of policies and governance in November 2013, before the review took place.

“The EFA acknowledged to The Fellowship that it was under a different structure and clear evidence was showing that there was a positive change in the operation since September 2013.

“The EFA are working with The Fellowship closely to ensure they successfully grow and continue to have the enormous impact it has already within its schools,” the statement added.