Labour has called on the government to “come clean” and publish an official report on the financial challenges faced by a multi-academy trust accused of “asset stripping” its schools’ savings before it collapsed.

It was revealed this weekend that Wakefield City Academies Trust (WCAT) had transferred millions of pounds of its schools’ reserves to its own centralised accounts before announcing, days into the new school term, that new sponsors would need to be found for them.



A year before WCAT collapsed, in summer 2016, the Department for Education’s Education Funding Agency launched an investigation into the trust. A leaked draft of the resulting report said the trust was in an “extremely vulnerable position as a result of inadequate governance, leadership and overall financial management”.

Despite requests to see the final report under the Freedom of Information Act, the department has so far refused to publish it. A spokesperson for the Department for Education said releasing the report would would jeopardise the process of placing WCAT’s schools with new trusts and cause disruption for the children concerned.

“The government needs to come clean and tell us what they knew about this scandal,” the shadow education secretary, Angela Rayner said. “If we’re going to learn the lessons we need to know the facts, and ministers should start by publishing this report. Hiding behind loopholes to dodge freedom of information requests just isn’t good enough, and schools should run in the public interest, not commercial interests.”



WCAT has been dogged by scandal in recent years. In October 2016, it emerged that it had paid almost £440,000 to IT and clerking companies owned by the then chief executive, Mike Ramsay, and his daughter. In a statement at the time, the trust said internal vetting procedures had found that the contracts represented the best value.

The draft DfE report, seen by TES, also raised concerns that Ramsay had been paid more than £82,000 for 15 weeks’ work, despite the fact that the trust was facing a large budget deficit.

On Sunday it emerged that many schools in the trust faced losing hundreds of thousands of pounds of their reserves. In some cases schools had money that had been collected through Christmas fundraising markets taken off them and put into WCAT accounts.

Hemsworth Arts and Community Academy, a mixed secondary school in Wakefield, faces losing £436,000 of its reserves. Wakefield City Academy could lose up to £800,000 and Heath View primary school, also in Wakefield, £300,000.

High Crags Academy primary school in Shipley was instructed by the DfE to join WCAT in April 2016 after being put into special measures the previous year. When it joined it had a surplus of £178,000, which was immediately moved to centralised accounts.



Eric Fairchild, the chair of the school’s local governing body, said that on at least two occasions the governors had asked WCAT officers if its surpluses were being used to shore up the trust’s accounts and that they were reassured that their money was ring-fenced and safe.

Mike Pollard, a Conservative member of Bradford metropolitan district council and chair of the school’s finance committee, said he was deeply concerned that the government was attracting “reputational damage to one of its flagship programmes”.

“The rush to ‘academise’ everything in sight appears to have created a situation where the due diligence we might expect, from the government department responsible for the direct funding of academy trusts, has been sadly lacking,” he said.



Rayner said: “From what we already know, it appears that the Department for Education knew about the serious financial challenges at WCAT, yet they not only failed to intervene but actually allowed the trust to aggressively expand.”

“This scandal poses real questions, not just about the government’s actions in this particular case but about wider issues as well. The Tories have abandoned proper oversight of schools and are now throwing millions of pounds at academy chains to aggressively expand, even while core teaching budgets are being cut.”

Earlier this month, the DfE named its preferred new sponsors for the schools abandoned by WCAT. Outwood Grange Academies Trust, which already manages 22 schools, is set to take over eight of them. Four will become part of the Delta Academies Trust, formerly known as SPTA, which was stripped of three of its schools in late 2015 following concerns about low standards.



Three schools will go to the Tauheedul Education Trust, two to Astrea Academy Trust, and Aston Community Education Trust, Brigantia Learning Trust Sheffield, Inspiring Futures and Exceed Learning Partnership will each take on one.

“The DfE should urgently look at what other trusts are raising similar financial concerns, and tell parents and teachers across the country how they will ensure that the scandal of WCAT is not repeated across the country,” said Rayner. “We will be asking questions about this in parliament and if ministers don’t start giving us some answers then people will wonder what they have to hide.”

A spokesperson for the Department for Education said: “Academy trusts operate under a strict system of oversight and accountability. We routinely take action to address underperformance.

“The Education and Skills Funding Agency periodically visits academy trusts to assess their financial management and governance arrangements, this includes multi-academy trust reviews. We do not routinely publish these assurance reports.”