Debts leave a 'nasty taste' as Schools Network folds

6th July 2012 at 01:00
Bankruptcy hits 1,000 creditors, but buyout keeps charity going

Schools are among more than 1,000 organisations believed to have been left out of pocket after the Schools Network - one of the biggest players in state education - was forced into administration, with debts running into millions of pounds.

The creditors, from school improvement consultants to individual secondaries and primaries, have been hit as a result of the organisation going bust after losing a number of lucrative contracts. Despite going under, the Schools Network has continued to trade by staging a management buyout and reverting to its former name, the Specialist Schools and Academies Trust (SSAT).

As reported by TES last month, the buyout was led by its chief executive, Sue Williamson, in a deal that is thought to be worth about #163;150,000. But the move means that the new company is not liable for any of the debts left by the Schools Network, which has been highly criticised by those who are owed money.

Anne Fowlie (pictured below) is a consultant working in special educational needs. She was part of a team employed by the network to provide materials for the Teaching Agency to be used to train teachers working with children with complex learning difficulties.

According to Ms Fowlie, the programme was delivered but the charity still owes approximately #163;70,000, including to a number of schools, for the work it carried out. About a dozen schools were promised around #163;2,000 or #163;3,000 each to allow filming for the teaching materials to take place on their sites, but many of them have not been paid, she said.

"I am personally not owed money, but I feel very strongly about this," Ms Fowlie said. "I was supposed to train people using the materials, but I cannot morally do that when I know so many people have not been paid for their work."

Those owed money were particularly critical of the fact that the Schools Network was continuing to commission work when, they claim, it knew it was facing financial difficulties.

A school improvement consultancy, Independent Thinking, had been providing training and speakers for the Schools Network and SSAT for "many years", but is now owed more than #163;2,200 for staging a training day in May. Ian Gilbert, managing director and founder of the company, criticised the buyout, stating that, while not illegal, he felt it was "unethical".

"Companies going into administration happens and I understand we are in difficult times," Mr Gilbert said. "However, the manner in which they did it, the manner in which we have been treated, all leave a very nasty taste, not to mention a debt of over #163;2,000."

The Schools Network ran into trouble after winning a major government contract to deliver Labour's diploma programme. That victory turned sour after the qualifications were effectively scrapped when the coalition came to power. The charity's substantial overheads also played a part in its downfall, not least its central London office, Millbank Tower, which overlooks the River Thames and is believed to have cost the charity #163;1.4 million a year.

At its peak, the organisation had grown to 400 staff with a turnover of about #163;100 million. Earlier this month, Ms Williamson told TES that the combination of government cutbacks and the economic crisis meant the Schools Network could not continue. The exact amounts it owes are not yet available.

An SSAT spokesman said this week that the trustees "explored every possible option" to keep the old business going, including seeking government grants and looking into an acquisition by other companies. "It was only after all of these options were exhausted that it became certain that the organisation would have to go into administration and trustees asked the chief executive to consider a management buyout," the spokesman said. "The offer of a management buyout was accepted because it was the best offer available for creditors."

Russell Hobby, general secretary of the NAHT heads' union, believes the new organisation has its work cut out to rebuild its reputation. "It's going to be very difficult for people out there to be convinced that the SSAT has re-established itself on a firm basis, with so many people saying they are owed money," he said.

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