Tag Archives: finance of education

An ATOL Scheme for MATs, as DfE finally takes action on MAT with a large deficit

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SchoolsWeek are running a story about the breakup by the DfE of a multi-academy trust that was seriously in deficit last August, when it closed its account year for 2024-25. Arthur Terry: Trust with £8m deficit to be broken up

 I suppose this is the sort of story that is best released just before a school holiday – what at one time was known as a ’Jo Moore’ story. Now there’s a surprise | John Howson

The fact that the Aruther Terry Learning Partnership (ATLP) can go from a deficit of £4.5mn in August 2024 to a deficit of £8.3mn in August 2025, and who knows what by May 2026, (page 83 of accounts filed at Companies House) raises serious questions about whether abolishing the Funding Agency and brining its functions back into the DfE has worked? THE ARTHUR TERRY LEARNING PARTNERSHIP filing history – Find and update company information – GOV.UK

The ATLP had 25 schools and a teaching hub under its management in August 2025. I make that a deficit of not far short of £320,000 per school.

SchoolsWeek informs readers that the issue has been around the decision to purchase iPads for all 11,000 staff and children. At current retail process that would amount to expenditure of somewhere between £3.6mn and £12mn, including VAT which would be recoverable.

Assuming some form of education discount, say 10%, the bill would be in the region of £2.5mn to £9mn depending upon the model selected. Opting to pay over a couple of years, would reduce the annual bill even more. As a result, although this might be a contributory cause, it doesn’t look like the whole cause of the crisis – unless I have underestimated their spend on additional software and other extras.

This is a MAT where they haven’t been paying excessive salaries to the senior staff. A top salary of £160,000, although more than any local Director of Children’s Services might have been receiving in August 2025, sadly isn’t way out of line for MAT CEOs.

The DFE has decided to wind up the MAT, and presumably force other MATs to take on schools in their localities. I assume, with some guarantee over any losses transferred with the school.

This is scandalous in terms of the oversight of public money. In my mind it demonstrates that lack of local political scrutiny means all the oversight rests with the civil service. Indeed, there is no reason for MATs not to rack up deficits if all that happens is the schools are transferred to another MAT, and the DfE funds the bill – presumably from the funds that might otherwise go to schools that manage to keep their finances in balance each year.

I wonder whether an ATOL type scheme might be appropriate, levied on all MATs, and used to pay off deficits that cause any MAT to become unviable? Of course, it will only work if the DfE is willing to take swift action. Any MAT with a debt amount of x per school should be wound up. The ATOL scheme, lets call in the MBOS (MAT Bail Out scheme) should have a board comprised equally of finance directors of MATs and finance directors of public companies, overseen by a financially astute, but neutral chair.   

Even if this sort of scheme isn’t attractive to government, there does need to be better oversight of MATs finances, especially as falling rolls will put pressure on all school finances. There might even be a similar scheme for local authorities, especially as local government re-organisation might mean the risk of lax internal audit regimes for a couple of years across large swathes of rural England.

Are there savings to be made in education?

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One of the tasks faced by someone no longer a councillor is to dispose of the vast accumulation of papers and reports collected over the years. While doing so it is possible to come across long forgotten articles. One such was an article that I wrote for the TES in their edition of 17th September 2010 that was headed ‘how to cut millions of pounds without harming the chalk face’.  Well, I suppose that ought to be the interactive whiteboard these days rather than the chalk face.

How relevant today are the suggestions I made at the end of a period when the Labour government led by Gordon Brown has favoured spending on education?

Back then, at a time when rolls were rising in primary schools, but still falling in the secondary sector: the opposite of the current situation, I focused firstly on the pension scheme and the cost of allowing private schools to be members of the teachers’ pension fund. I warned that uncapped salaries could risk bankrupting the scheme if there was either no cap on salaries or contributions didn’t rise.

In the event, the decision was taken to increase contributions and to ensure new entrants were on average salaries for their pensions rather than the more expensive final salary scheme previously available. However, the scheme is still massively expensive, especially as many pensioners are living longer. (note as a recipient of a public sector pension, I have an interest in anything the government does to public sector pensions).

My second suggestion was to reform teacher training to a more school-based system that required secondary schools only to train for the staff that they would need. In a period of falling rolls, it is easy for the DfE’s Teacher Supply Model that uses historical data to calculate the number of teachers needed to overestimate the needs of schools to recruit teachers. With a period of falling rolls currently facing schools, this is certainly an area where discussion might be helpful, especially after the recent announcement of more training places for graduate apprenticeships. Wasting training places, either for teachers that cannot find a teaching post in England or that start work in the private school sector, can lead to a mis-direction of funds.

Allied to the previous point of training, in 2010, I highlighted the issue of redundancies, and whether a system should be employed whereby all vacancies on offer by all state-funded schools should first be offered to those teachers facing redundancy: otherwise, the cost of redundancy payments for teachers that might then walk into another teaching post was a waste of money. How to handle the labour market for teachers during a period of falling rolls is something the DfE might still need to consider.

My concluding point related to Labour’s flagship projects. Of course, the one of those that mushroomed under the Conservative governments was the creation of Multi-Academy Trusts, each with its own chief officer and backroom staff. In Oxfordshire, there are around 20 MATs. Reducing that to say, five, could reduce central office costs, and allow the cash saved to be diverted into in-service training, and the recreation of an advisory and inspection service to stand between schools and ofsted, as well as identifying the future leaders of our schools, something the present system does not always do well. Saving just ten MAT CEO posts at £150,00 each might save around £2 million a year after on-costs have been taken into consideration.

Where there are falling rolls, unless overheads are reduced, the cash available for teaching and learning will undoubtedly be reduced in a period where the demands on government spending for areas such as defence and policing are uppermost in the mind of a government that doesn’t want to raise taxes, and thus may struggle to find extra cash for schooling.