Academy sponsor lord quits after cash probe

Date published: 19 March 2009

THE chairman of one of Oldham’s academy sponsors has quit after his trust misspent around £70,000.

East African-born businessman Lord Amir Bhatia has resigned from Edutrust Academies Charitable Trust (EACT), set up by his British Edutrust Foundation to open and run academies across England.

Meanwhile, Oldham Council has confirmed it will continue with plans for Edutrust to run a new academy to replace Grange School.

A Government inquiry in November found that EACT did not comply with financial management requirements set out by the Government, did not have appropriate governance arrangements, failed to address conflicts of interests and had poor record keeping.

Less than £70,000 was misspent on excess rent paid to the Ethnic Minority Foundation of which Bhatia, one of the first people’s peers, is chairman. This has been repaid and EACT has established a new board and revised its management arrangements.

Oldham’s plans to replace five schools with three academies run by sponsors are part of its £230 million Building Schools for the Future Plans to overhaul secondary education. The Edutrust academy will open in the existing Grange buildings in September, 2010, before moving into a new school in 2012/13.

Schools secretary Ed Balls said the changes at EACT had provided the “necessary reassurance” to work with it on current and future projects.

But Stuart Paulley, publicity officer for Oldham Campaign Against Academies, called for all councils to be given time to review their BSF programmes following the investigation.

He said: “This should set alarm bells ringing in both Government and Oldham Council. They cannot now trust an organisation which has been guilty of financial mismanagement.

“It undermines confidence in Edutrust’s ability to run schools. Our children’s education is being put at risk.

“The situation also illustrates the flaws in the academies programme. How many other examples of sponsors’ financial mismanagement will come to light? We already are aware of academies agreeing contracts with companies that have close links to their sponsors.”

However Councillor Kay Knox, Oldham’s cabinet member for children, young people, and families, said: “We would like to reassure parents and pupils that the resignation of Lord Bhatia will not affect plans to open a new Edutrust Academy in Oldham.

“The Department of Children Schools and Families clearly has full confidence in the new structure at Edutrust and we will be continuing to work very closely with the foundation during the months ahead, and local schools, towards completion of the project.

“Both ourselves and Edutrust’s team of project managers and advisers remain fully focused on the work ahead to bring the new academy to Oldham on schedule.”