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E-Act loses out on Mill Hill school, following financial mismanagement revelations

The bad news keeps on coming for E-Act. One of the country’s biggest academy sponsors has been forced to abandon plans to run a new primary school in North London after the local council objected to its involvement in the scheme.

Last week, Barnet Council bosses announced that they had dropped plans for E-Act to sponsor a new primary school in Mill Hill, after revelations that the chain had been reprimanded by the Department for Education for serious financial mismanagement.

Back in February, the town hall announced it was to build the school as part of a wider regeneration project and then hand over the keys to E-Act for the institution to be run as an academy. However, the local authority has said it is now looking at alternative providers for the school.

“E-Act was appointed as the preferred provider earlier in the year but given information that has subsequently come to light we have been working with the DfE since April to develop alternative proposals for the new school,” a council spokesman said.

As revealed exclusively by TES in May, an investigation into E-Act, which manages 35 schools in England, unveiled a culture of “extravagant” expenses and revealed that hundreds of thousands of pounds of public money were being spent on unapproved consultancy fees.

A report by the Education Funding Agency, which is part of the DfE, stated: “Expenses claims and use of corporate credit cards indicate a culture involving prestige venues, large drinks bills, business lunches and first-class travel all funded by public money.”

It adds that expense and card payments by senior managers “occasionally stretched the concept of propriety and value for money. Controls have been lax and some payments have tended to extravagance. However, we found no evidence of fraud.”

The damning report led to the resignation of the chain’s director general Sir Bruce Liddington, who was one of the most highly paid people in UK education. In 2010-11, he received almost £300,000 in wages and pension contributions.

Since Sir Bruce’s departure, the chain has claimed to have moved into a “very different gear” and has conducted a major overhaul of its management and governance.

Commenting on the Mill Hill project, an E-Act spokesperson said that the chain was concentrating on its existing group of schools.

“E-Act doesn’t turn down any opportunity to work with parents, pupils and teachers wherever it arises. But our focus at the moment is the existing E-Act family and we are working closely with the EFA to ensure that the excellence of our education is underpinned by excellence in our operations and management,” the spokesperson said.

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