The Past, The Present, and The Future

Is conversion into an academy a fundamental change or do some things stay the same?

It is a fundamental change because schools become independent schools and cannot change back without closing. However, a number of things remain the same: admissions, collaboration on children with special educational needs and other hard to place children, religious designation, age range (normally, but see below), the terms and conditions of employment of existing staff, the various worship and RE requirements for different types of school and the governance, employment, RE and worship arrangements for VC/Foundation minority converters.

What is the government policy of conversion “as is”?

This was developed initially to describe government policy on admissions and religious designation but has subsequently been extended and made much more detailed in respect of VC converters so that they do not receive the same powers re staff appointments, RE and worship as should strictly be theirs as independent schools. The government has inserted special clauses into the Funding Agreement to cover this (which must be use only for VC and Foundation converters) and is expected to legislate to cover the matter in the next Education Bill.

What can actually be changed and when?

VC schools can continue to change to VA or to Foundation majority schools before converting (using statutory notices under the Education and Inspections Act 2006). They would then become majority model academies on conversion.

There will be a process for minority model academies to change to majority model after conversion. This is likely to require a local consultation and, since such a change would mean changing the Articles, the Secretary of State would be the decision maker. He would normally agree such a change.

Also the DfE has indicated that in a small number of cases where there was a very strong local reason and all parties were in agreement, a VC/Foundation minority school would be allowed to convert using the majority model. We recommend looking closely at this possibility in all circumstances.

While the legislation is actually under a different section of the School Standards and Framework Act, the powers of independent schools in respect of employment criteria, worship and RE are broadly those familiar in the VA context. The contractual position of existing staff is protected on conversion.

What about age range or other changes?

It was always foreseen that academies would convert with their existing age range and they must do so with their existing gender intake, their existing admission policies and any selective powers they may currently have. This is an expected area of “as is”.

However, the Academies Act recognises that sometimes changes of age range at the time of conversion may be attractive locally and thus should be enabled. Sections 8 and 9 of the Academies Act 2010 apply. The school would be treated as an additional school. A separate consultation would be required and the Secretary of State must take account of the impact of such a change on schools and further education establishments in the area of the school.

This provision enables the addition of 6th forms and/or the creation of all-age schools. It could also enable the change from three- to two-tier provision.

Other changes may be proposed (eg a single sex school becoming co-educational). If proposed at the same time as conversion it is assumed they will be treated as additional schools. If proposed later, there will have to be a consultation and the Secretary of State will decide whether to agree the change. Changes post-conversion are likely to have lighter-touch procedures than statutory alterations under the 2006 Act.

How is the religious character of an academy preserved?

This is achieved by having a majority of Church members on the academy company and the appointment by them of a majority of church governors. The Models include provision (and recommendations) for Church of England Corporate Bodies to form the core of the membership. This ensures succession of members (and hence of governors) in much the same way as present Voluntary school foundation governor arrangements,

We advise that the DBE, if it is incorporated, should itself always be a member and governor in its corporate capacity. This ensures that it is inside the company so able to challenge decisions that could weaken the religious character of the academy. This may be the time for more DBEs to incorporate themselves. Otherwise they will have to ask the DBF (or the trustees) to undertake this role for them. The Chelmsford Diocese Educational Trust provides this corporate membership in our diocese.

The very important (and non-optional) Supplemental Agreement provides that the DBE (whether or not it is a member of the company) may request the Secretary of State to use his powers of intervention if the academy drops two SIAS grades over a five year period or fails a SIAS or if the DBE believes that the academy is being conducted in a way that puts its religious character at risk. We believe that the Secretary of State would respond positively to such requests where either the SIAS criteria are met or where other serious reasons exist. DBEs should not hesitate to use this power.

Is an academy company a charity?

Yes. An academy company is an exempt charity with the Education Funding Agency as principal regulator. The trust is answerable in some respects to the Charity Commission, but no registration or returns are required and (as with voluntary school trustees and governing bodies currently) there is no charity number. The DfE often refers to the academy company as the academy trust. We generally use the term academy company so as not to confuse the academy trust and its trustees with the existing trustees who hold the site and will make it available to the academy as set out below.

Who are the charity trustees of that academy company?

The company directors (described as governors in the single academy company constitution model) are the trustees of the charity.

Why are they sometimes called Governors?

They are called governors in the single academy company constitution model (the name they had as a maintained school), but in law their true status is as company directors of the academy company. In multi-academy companies they are properly called directors and this differentiates them from the governors on Local Governing Bodies for the individual schools. Note that the governors on Local Governing Bodies only exercise powers at the behest of the directors and that these powers may be withdrawn (or over-ruled) at any time. A governor on the Governing Body of a maintained school and a governor on the Local Governing Body of an academy run by a multi academy company have very different roles and responsibilities.

How do the existing trustees fit into the picture?

The existing trustees will always continue to hold the land for the school. We strongly advise that, although it is legally possible under the Academies Act for them to hand over their freehold to the academy company to hold as trustee (never in the academy company’s own right), the trustees should never in fact do so.

There are three reasons for this (a) if the school site is all they own they will be destroying their own trusts –which is itself a breach of trust (b) they would be in danger of triggering reversion of their site to the heirs of the original donors under certain Acts if they disposed of their site in this way (c) in the case of minority conversion models the academy trust is not a suitable body to sustain the trusts of a Church of England school.

Who are our existing trustees? Do all voluntary and foundation schools have them?

Existing trustees may be the DBE, the DBF, the local incumbent and churchwardens or a special membership local trust. Schools should know who they are and must consult them and get their agreement for academy conversion. If the school does not know, the diocese may know. The trust deed, if they have it, will say. The National Society may have the information in its archives. If the information cannot be found, schools must take legal advice, approach the Charity Commission and resolve it. Schools should not try to convert without knowing who the trustees are.

How is the land dealt with?

The DfE originally supposed that the trustees would convey the freehold of their land to the new academy company and that still remains an option set out in the DfE guidance on land transfers.

However, the DfE has accepted that this is not necessary (and is not “as is”) and that land may continue to be owned by the existing trustees who then provide it to the academy company for its occupation and use.

This may be by means of a lease and a model lease forms part of the model documents. However, even a lease is not “as is”, since voluntary schools currently use their sites by simple permission (a sort of informal licence) of the trustees without any documentation.

National Society advice is that this informal arrangement (which has worked well for more than 100 years) should be the norm for all portions of school sites (VA, Foundation or VC) currently in the ownership of trustees. Consequently no lease or written licence is actually required.

The DfE may want to press for leases in the case of VC sites (as they always have a mixture of public and private value in those parts owned by the trustees). The National Society recommends that schools, dioceses and trustees should resist this pressure, as it does not reflect “as is”. If schools do agree to a lease, they must use the model provided as it includes essential safeguards for the trustees.

Care must also be taken if there is residential property (a school house or a caretakers’ house) on the site to be leased. There is a technical problem about enfranchisement which means that such premises must be leased separately and for shorter periods than the 125 years of the standard lease.

The National Society’s legal advisers will be able to provide a written license if necessary.

Land currently in the ownership of the governing body may be returned to the LA for them to lease to the academy trust or, preferably, the governing body may decide that it wishes the Secretary of State to direct that the land be transferred freehold to the academy trust. The National Society advises the latter course as the norm. This will facilitate any later transactions between the academy company and the trustees should the academy need new or further buildings and consequent site changes are required. Land in Local Authority ownership will normally be leased to the academy company.

Why does the Supplemental Agreement include possible diocesan/trustee powers over the land?

Because the school site belongs to the trustees (which may be the DBE or DBF) it is provided that they may take on responsibility for insurance and for maintenance/improvement, charging these to the academy company. Some dioceses and schools may wish to do this, as it enables some economies of scale and resources. If so, the diocese must be careful not to take on any responsibilities for which it is not funded. The model is drafted with that proviso in mind.

However, in many cases academy companies will wish to undertake insurance and maintenance/improvement works themselves and dioceses would be content with this. The Supplemental Agreement must be amended accordingly. Academy companies may use the diocesan buildings teams to carry out this work for them as most VA schools do at present. VC schools should speak to their dioceses about this as part of their conversations on conversion. This is a well-established diocesan service that offers economies of scale without taking the decision-making and strategic role from the academy company.

What happens if an academy closes?

Land in the ownership of the trustees remains in their ownership and is either used by them for a replacement school/academy or would be sold by them, much as happens now. Any decisions about the relative sale proceeds due to the trustees and to the Secretary of State would be agreed or determined by the Secretary of State much as now. The same criteria will continue to be used.
Otherwise, the school simply closes and is (or is not) replaced according to need. This may require a school competition. If a replacement school is required then the Secretary of State may well agree that it can be a Church of England school so that the site can continue to be provided. Otherwise he has to buy the site at (we believe) open market value. We have provided that any lease terminates with the closure of the school so that the value of the site is not impaired.

Can we just decide to change back?

No. Currently at least the academy would have to close and there would be a school competition. However, the Secretary of State could agree to what would effectively be a change back. This is one of the policy issues that have been developing recently.