Harris and Oasis academy chains owe government millions in pledged funding

13th October 2016 at 18:02
School groups have failed to repay combined total of more than £10m in promised capital payments, data reveals

Two high-profile academy trusts owe the government more than £10 million between them in outstanding capital funding, according to data published today.

Until 2010, academy sponsors were required to pay upfront capital costs or endowments to the Department for Education.

But nearly £13 million has still not been paid, information obtained by Local Schools Network shows.

The Harris Federation has only paid £743,000 of the £6.5 million it promised for six academies, while Oasis Community Learning owes just under £4.4 million for three academies, according to the data.

Early academy sponsors were required to pay 10 per cent of capital costs for each academy, capped at £2 million.

This was later replaced by endowments, whereby sponsors created an endowment fund. The fund’s interest was intended to provide income for each academy.

This requirement was abandoned in 2010.

Shortfall on contributions

In 2011, the Public Accounts Committee (PAC) found the Department for Education had struggled to enforce payment of outstanding debts from academy sponsors.

Only £121 million of a promised £147 million of capital contributions had been received, and there was a £4 million shortfall on endowment contributions due by the end of December 2010.

The committee recommended that the DfE should agree settlement programmes and check that payments were duly received.

But the data reveals that nearly £13 million of the pledged capital costs remains outstanding.

Just over half (56 per cent) of that is owed by nine academies. Agreements or ongoing repayments are in place for five.

One repayment agreement is in place for just one of Harris’ six affected academies, but the payments are not yet due.

The DfE is discussing with the London Diocesan Board for Schools (LDBS) about repayment of £1 million.

It is also in talks with Oasis about a payment plan for nearly £400,000 at one of its academies.

However, no agreement is in place for recovering £4 million in respect of two other Oasis academies, according to the Local Schools Network.

The remaining unpaid costs were spread among a handful of other trusts

An Oasis spokesman said: "We're in ongoing discussions with the Education Funding Agency regarding this matter.

Harris, the London Diocesan Board for Schools, and the DfE have also been contacted for comment.

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