Recommendation 1

HM Government Not Addressed

Introduction from the Committee The Academy Sector Annual Report and Accounts (SARA) presents the consolidated financial results of academy trusts, of which there were 2,743 open at 31 August 2020. Academy trusts may be formed of one or more academy school. Academy trusts are charitable bodies and have more freedoms and responsibilities than local authority maintained schools. For example, they are responsible for setting staff pay and conditions, determining their own curriculum, and are directly responsible for their financial and educational performance. Academy trusts are required to produce a set of accounts annually that are subject to external audit. Academy trusts are directly funded, and accountable to, the Department for Education via the Education and Skills Funding Agency. The sector reported £31.3 billion of income during 2019/20, including £26.8 billion of grants from the Department. The Department aims for all schools to be part of a family of academy trusts. The academies sector continues to expand, with 9,200 academy schools open during the year to 31 July 2020, compared with 8,728 in the previous year. More of these schools are joining other academies to form multi- academy trusts. The average number of academies in a multi- academy trust was six during 2019/20. The biggest multi-academy, the United Learning Trust, now stands at 76 schools. The COVID-19 pandemic has slowed growth in the sector, which is taking longer for maintained schools to convert to academies. The 2019/20 SARA is the fifth set of sector accounts. The Comptroller and Auditor General has qualified their opinion of previous accounts due to uncertainty over the valuation of land and buildings within the academy estate. The Department has since introduced its own programme of revaluations using qualified surveyors, which has addressed these historic issues and ensured the accuracy of the £56.3 billion value of land and buildings held within the academy estate. Based on a report by the National Audit Office, the Committee took evidence on 25 January 2022 from the Department for Education and the Education and Skills Funding Agency. The Committee published its report on 25 March 2022. This is the government’s response to the Committee’s report. Relevant reports • DfE report: Academy schools sector in England: consolidated annual report and accounts, 2019/20 which includes the Parliamentary Accountability and NAO Audit Report – Session 2021-22 (HC 851) • PAC report: Academies Sector Annual Report and Accounts 2019/20 – Session 2021-22 (HC 994)