Academies Act 2010 receives Royal Assent

The much-anticipated Academies Act 2010 received Royal Assent on 27 July 2010 and provisions are being brought into force in such a way that the first Academies can be opened in September 2010.

The establishment of Academies under the Act is through the conversion of existing schools. Initially, schools which have been rated as outstanding in their most recent Ofsted inspection are able to apply to become Academies. This is to be extended to other schools in the future.

Nature of an Academy

The Government describes Academies as “publicly funded independent schools, free from local authority control.”

A new Academy will be run by an Academy Trust (a charitable company limited by guarantee) which would have exempt charitable status - meaning that it would not have to register with the Charity Commission.

Members of the Trust (those establishing the Trust) would appoint the governors of the Academy.  The governors would be responsible for such matters as the standard of education provided to pupils, the finances and property of the Trust, the employment of staff (including pay and conditions), contracting services, compliance with company and charity law and observing the terms of the funding agreement under which the Government will finance the Academy.

If the Academy is to be a mainstream school (rather than a special school) it will have to have certain characteristics. These will include providing a balanced and broad based curriculum, having a specialism (where secondary education is provided), providing education for pupils of different abilities (unless it is an existing  selective school), and wholly or mainly drawing its pupils from the area in which the school is situated. A mainstream Academy will also be subject to the obligations of a mainstream school with regard to children with special  educational needs.

The Academy will not be required to follow the National Curriculum. It will be its own admissions authority, but will be bound by the Admissions Code.

If the converting school was previously a foundation or voluntary school designated as having a particular religious character, the Academy will be treated as having that religious character.

Process of conversion

It requires a resolution of the governing body of a maintained school in England before an application can be made to the Secretary of State to become an Academy. Where the school is a foundation or voluntary school with a foundation, the governing body has to consult the foundation before applying and  may only apply with the consent of the trustees of the school and the person(s) by whom the foundation governors are appointed.

Before a maintained school is converted into an Academy, the governing body must consult such persons as they think appropriate.  A consultation is likely to include parents and local bodies or groups who have strong links with the school. There are no prescriptions as to the way that the consultation is to be carried out but could include meetings, information on the schools website, or letters to parents giving details of the proposal to convert.

The conversion to an Academy involves the transfer of the school staff to the employment of the Academy Trust. Consultations under the TUPE Regulations would have to take place with staff and unions as part of the conversion process before the Academy opens.

Funding of the Academy

The local authority will cease to maintain the school on the day on which it opens as an Academy.  Instead, the Academy will be funded through money received from the Government under the terms of a formal funding agreement between the Secretary of State and the Trust or through grant funding (under section 14 of the Education Act 2002). An Academy will be funded at a comparable rate to maintained schools, but will also receive the share of central funding that the local authority used to spend on its behalf.

Payments under the funding agreement could be in respect of capital or current expenditure. To the extent that it relates to the latter, the agreement will continue (subject to compliance with its terms) for at least 7 years or indefinitely but terminable on the Secretary of State giving at least 7 years' written notice.

Transfer of staff and assets to the Academy

Staff at the school would become employees of the Trust through the TUPE process.

The Academy will inherit the financial situation of the converting school. Any surplus that the school has at the time of conversion (ie any unspent amount of the funds that the local authority had made available to the governing body) will be transferred from the local authority to the Academy Trust. If the school has a deficit, the Secretary of State will pay the local authority a sum equal to the deficit (so that it can write it off in its accounts) and over a period of time recoup that payment from the funding allocated to the Academy.

Arrangements are also made for the transfer of land and other property to the Academy Trust. Publicly owned land is likely to be transferred by way of a 125 year lease from the local authority. Where the school has a mixture of public and private land, the transfer of the private land would be terms agreed between the owner, the local authority and the Academy Trust.

For further information please contact Clare Colacicchi on 01604 233233 or via email.