Academy collaboration: legal considerations
As an existing stand-alone academy, can we become an academy group?
Yes. It is becoming increasingly common for academies that have already converted alone to move to a multi-academy trust (MAT) structure, frequently to offer support to other schools in their area.
It is becoming increasingly common for academies that have already converted alone to move to a multi-academy trust (MAT) structure
An increasing number of schools and academies are exploring formal collaboration, particularly converting from a single academy to a MAT in order to support and work with other schools in their area.
If we are an academy and wish to collaborate formally with other schools, is a MAT the only group structure available?
No, there are a number of options that can be explored. The most suitable model will depend on the objectives of the collaboration.
Where an existing single academy trust is looking to support a school that is underperforming, a traditional MAT is the most common structure, as it will create a shared academy trust.
The expectation is that the board of directors of this trust will be made up, in the majority, of appointees of the strong ‘sponsor’ academy. That board of directors will become accountable for the running of the sponsored academy, as well as the existing academy and any that may join the group in the future.
An alternative model is an umbrella trust.
This involves each academy having its own academy trust, thereby implying more autonomy for each academy. However, the individual academy trusts are united through an overarching umbrella trust.
This umbrella trust can have appointment rights onto the board of each academy if certain ‘trigger events’ occur, for example a poor Ofsted grading.
A further option is a collaborative partnership, which involves academies working together under the terms of a collaboration agreement.
However, this is considered to be a much ‘looser’ form of collaboration. Where an underperforming school is involved, the DfE may not be satisfied that it is robust enough.
What are the governance implications?
Although a new company does not need to be created (the existing legal entity can be used), the single academy trust’s current articles of association (which set out the number and categories of governor) will need to be amended to enable multi-academy articles to be adopted. The DfE has a model form of articles for MATs, which it will expect to be used.
The academy will need to consider rearrangement of its governance structure
The academy will need to consider rearrangement of its governance structure, as it is unlikely to be appropriate for all of the existing directors of the single academy trust to remain as directors of the MAT. Usually, some of those directors will remain at board level, but others will move to sit on the local governing body of the individual academy, rather than the central board.
Will we need to amend our funding agreement?
Yes. Rather than having a single funding agreement, MAT structure will require there to be a master funding agreement (the terms of which will apply to all academies within the MAT).
Supplemental funding agreements
In addition, each individual academy within the MAT will have its own supplemental funding agreement (SFA). The SFA sets out terms that only apply in relation to the relevant academy, rather than to the group as a whole. For example, it enables an SFA to be terminated without the rest of the academies in the group being affected – their SFA and the master funding agreement would remain in place.
Terms and conditions
When agreeing the terms of the new master and supplemental funding agreements, it is important for the academy trust to consider whether there are terms in its current SFA that are more advantageous than the terms of the new documents. For example, previous versions of the funding agreement may include less onerous conditions in relation to the payment of capital grant.
It is also worth noting that the newer versions of the funding agreement also have some clauses that offer greater freedoms to academies than previous versions, such as the removal of the requirement to employ teachers with QTS. All of the academies will therefore be able to take advantage of such new freedoms.
If we become a MAT, can other types of school join our group?
As well as supporting academies, a MAT structure can also support free schools and studio schools
As well as supporting academies, a MAT structure can also support free schools and studio schools.
Slight amendment to the articles may be necessary to accommodate these schools, and the form of SFA will be different. But otherwise, in terms of legal documents, the process is the same.
How can we protect our academy’s autonomy in a MAT structure?
It is usual for each academy to have its own local governing or advisory body. The appropriate amount of control at local academy level can be achieved through the scheme of delegation to this local body.
A scheme of delegation
For a school requiring a high level of support and input from central level, a scheme of delegation can be adopted. This provides for a minimal amount of delegation to the local governing body. In addition, the local governing body of that academy may have a membership that is controlled in the majority by the sponsor school.
However, for a strong academy that wishes to have the freedom to operate more independently of the board, the scheme of delegation can provide for a high amount of delegation.
It is important to remember, however, that even where responsibility is delegated to a local level, it is the academy trust as the legal entity (not the local governing body) that is ultimately accountable, for example in terms of finance and performance, and as the employer of staff.
As a maintained school looking to convert to academy status, why should we consider joining a group?
One reason would be if the DfE requires you to.
Where a school is not graded as good or outstanding by Ofsted, then the DfE is likely to want to see evidence of support from another academy. One of the group options is a route to securing this.
Schools may also choose a group because of the opportunities to share services and resources, particularly when local authorities may be unable to continue to offer the support and service previously provided.
What does the future hold for groups and chains?
There is, of course, debate about the extent to which structure really matters and whether other factors, such as excellent teaching, are more important when aiming for a world-class education system.
Resources are key though. The pooling and sharing that become readily available through group structures offer efficiencies that schools may struggle to survive without in the future.