What Does the Schools Bill Mean for You?

The Schools Bill builds on the White Paper and is the most substantial piece of legislation on the school system since the coalition Government's Academies Act 2010. Here we consider some of the key provisions and what these might mean for your school or trust.

Academy Trust Standards - Partial Abolition of Funding Agreements

The White Paper confirmed the DfE's vision that all state-funded schools be operated within a strong multi academy trust by 2030.

One of the main drivers of the Bill is to put in place a regulatory system which is capable of managing a fully academised system of approximately 21,500 schools (as distinct from a state funded system accommodating a much smaller number of 'City Academies' when the programme started).

Part one of the Bill seeks to transfer the regulation of academies from a predominantly contract based system to one based in legislation, and specifically as set out in regulations (Standards) made by the Secretary of State from time to time. With the exception of certain key pieces of legislation, such as the Independent Schools Standards, the current system is contractually based with a funding agreement being put in place between the relevant academy trust and the Secretary of State.

The Bill lists examples of matters (but makes clear the list is not exhaustive), which might be covered by the Standards including:

• the nature and quality of education provided and the curriculum followed
• the length of the school day, the school year, school terms or school holiday periods.

To the extent that a provision in the funding agreement 'corresponds' to a Standards requirement, it will be deemed void.

Question - What Does This Mean for Academy Trusts? 

• We can expect existing funding documentation to be replaced by much shorter agreements and academy trusts may be required to update all of their funding documentation to the new short form.
• The requirements as to how academies are operated will instead be set out in the Schools Act, the Standards Regulations and other guidance issued from time to time. These will be subject to change but will, in contrast to changes to the model funding agreement and the Academy Trust Handbook, be subject to a debate and affirmatory vote in both Houses, allowing Parliament to scrutinise the introduction of new requirements.
• The original Standards are expected to mirror the requirements imposed on academies under the 2020 model funding documentation with additional requirements being put in place for attendance, the handling of complaints, and the new 'collaboration standard'. There is concern that to the extent that academy freedoms remain, these will, in time, be eroded.

Question - When Will the Change Be Brought Into Effect? 

The changes are expected to be brought into effect from 1 September 2023. Many academy trusts are already in the process of updating their documentation to the latest published model. As to whether any trust proceeds with their update will depend on the circumstances of each case. In some scenarios, the update to the 2020 model funding agreement will be a requirement of, for example, a significant change approval or a new free school and so it might still be appropriate to proceed with the update.

Powers to Intervene When Things Go Wrong

The Bill provides a number of new intervention powers with two key objectives:

• To provide the Secretary of State with greater powers of intervention when an act of non- compliance/ failure is considered to be at 'trust level' rather than at academy level.
• To provide alternatives to termination and the transfer of the relevant academy/academies.

Question - What Are the Intervention Powers Set Out in the Bill?

• A power to issue a Compliance Direction, which can be enforced by the Secretary of State under a mandatory order. This can be issued in circumstances where the trust has breached or is likely to breach legislation/ the funding agreement or has acted (or is proposing to act) unreasonably with respect to its duty. This is a new provision, although it could be considered comparable in its effect to a termination warning notice by seeking to effect particular behaviours.
• A power to issue a Notice to Improve and impose financial restrictions on academy trusts. The Secretary of State already has a power under the funding agreement through the Academy Trust Handbook to issue such a notice where the ESFA has 'concerns about financial management and/or governance in an academy trust'. The wording in the draft Bill differs in scope but there might not be a significant change here.
• A power to direct the appointment of Trustees and to replace existing Trustees with an Interim Trust Board in specified circumstances. Some of the earlier academy trusts had similar provision in their Articles. If enacted as drafted, this would apply universally to all trusts. Some key points to note here:
  • These Trustees can be remunerated irrespective of restrictions in charity law/ the Articles.
  • Representation of the interests of a religious body (if any) will be replicated so far as is practicable.
  • The Interim Trustee Period cannot last more than two years although note that it can progress into a pre-termination period.
  • When an Interim Trust Board is in place, certain provisions under the Articles and legislation will be disapplied such that for example, the Interim Trustees can't be removed or be directed by the Members.

Changes to the Termination Provisions

As you would expect, the above range of intervention powers are backed by an ultimate right of termination. Many of the termination warning notice provisions and rights of termination set out in the Bill mirror those in the 2020 model funding documentation.

Under the Bill however, the circumstances in which a trust can be 'terminated' are broadened to include:

• termination (either at academy or trust level) where the trust has not satisfied a compliance direction, a notice to improve or a direction to appoint Trustees
• the right to issue a termination warning notice at trust level in respect of breaches of the master funding agreement, where the safety of pupils or staff is threatened, or where there is a serious breakdown in governance or management.

Academies with Religious Character (and the Trusts Which Operate Them)

The Bill seeks to protect the religious character of academies by bringing matters which were previously dealt with contractually under the funding agreement onto a legislative footing - thereby mirroring the position for their maintained school counterparts. This includes the provision for collective worship and religious education.

In addition:

• there is a requirement for the Secretary of State to make Regulations in cases where a trust operates either an academy with religious character in a single academy trust or a majority of academies with religious character in a multi academy trust - such that a majority of their trustees must be appointed to secure the religious character of the academy/academies and a majority of the members must be appointed by the relevant religious body. We note that as drafted, this applies equally in circumstances where the relevant academy was formerly a voluntary controlled school.
• There is a power for the Secretary of State to make Regulations as to the governance of an academy trust which operates at least one academy with a religious character.

Certain trusts, which operate under the current church 'minority' model might find that changes are necessarily required to the Articles to facilitate the above requirements and to move to a 'majority' model.

School Attendance

The Bill contains a number of provisions around the matter of school attendance. Note the implementation date is scheduled for September 2023 but that the DfE's new attendance guidance takes effect from September 2022.

We consider the requirement for attendence policies and the DfE's new guidance in a recent article.

Question - What Are the Specific School Attendance Provisions in the Bill?

• Local authority duties and support - a number of measures are proposed including the requirement to have regard to guidance which will set out the minimum components of support which local authorities are required to provide to schools in their area.
• Attendance policies - the proprietor of every school in England will need to publish and implement an attendance policy to promote regular attendance.
• Penalty notices - provision is made to nationalise the general circumstances in which a notice will be granted (albeit that local authorities will continue to make decisions on case by case bases).
• Approval of leave of absences in academies - academies will be brought onto an equal legislative footing as maintained schools such that leave can only be approved in exceptional circumstances.

Academisation

Whilst the Bill is designed in part to facilitate a school system which is fully trust led, there are minimal provisions which deal with academisation itself, rather than the way in which the system is held to account.

The one key exception to this is section 29 which includes a new power for local authorities to apply for academy orders in respect of maintained schools in their area. Before exercising this power the local authority is required to:

• Consult the governing body of the relevant school and, where applicable, its foundation; and
• Secure the consent of the trustees of the school site and the persons by whom the foundation governors are appointed (where relevant).

Other measures to facilitate a fully academised system have been taken forward since the publication of the White Paper, include:

• The proposal that local authorities be able to establish multi academy trusts in areas where there is a lack of strong multi academy trusts. Initially the DfE will be conducting 'test and learn' exercises through 2022/23 and is inviting local authorities to register their interest.
• The Government has concluded its consultation on the question of expanding the circumstances in which a maintained school (and an academy) are "eligible for intervention" to include those schools which are currently judged as 'requires Improvement by Ofsted' and which were also judged below 'Good' in their previous full inspection. In the case of a maintained school, the Secretary of State would have the power to issue an academy order. The implementation of this power is subject to Parliamentary approval but if given would be available from September 2022.

Attend Our Academisation Briefings

In association with the Institute of Business Leaders (ISBL), we are hosting a series of webinars to help you navigate some of the legal and practical issues arising out of the White Paper and the academisation agenda. For session 1, delegates have the ability to choose the webinar which best fits their school or trust's circumstances (be it as a maintained school, single academy trust or multi academy trust). In session 2, we are hosting a panel session where delegates from Session 1 can come together and have the opportunity to ask our panel of expert their questions. We'd be delighted if you are able to join us.

See below the list of our sessions:

• Session 1A: Maintained Schools - 8 June, 10.00am - 11.00am
• Session 1B: Single Academy Trusts -14 June, 4.00pm - 5.00pm
• Session 1C: Multi-Academy Trusts - 16 June, 12.30pm - 1.30pm
• Session 2: Panel Session - 21 June, 2.30pm - 3.30pm

For more information on the Schools Bill, please cotact Chloe Brunton in our Academies team on 07920 281 889, or complete the form below.