Guest Blog - Another Barnet Council Outsourcing Disaster - By Andrew Dismore

By Andrew Dismore

On 25th February this year Conservative Barnet Council’s Cabinet  agreed  “to put forward E-ACT as the preferred proposer for the new primary school within the Mill Hill East regeneration  area”. When they did so, they clearly had taken no steps to investigate the background and track record of E-ACT, and in particular their financial probity. This is why I have now written to the Leader of the Council asking how it is that Barnet, yet again, have been found out to  be dealing with a dodgy company like this.

Barnet must break all links with this outfit, and in my opinion go back to basics in education. The Council must   provide a normal primary school for the site, within normal LEA arrangements and stop pandering to the latest education gimmicks advanced by Michael Gove.

The record of E-ACT is shameful.

In May this year, E-Act, which runs 31 schools, became the first school sponsor to be issued with a "financial notice to improve" by the Education Funding Agency (EFA) after they found a string of "weaknesses" in the reporting of its schools' accounts.The notice to improve is not the first time concerns have been raised over E-Act's financial arrangements. In 2008, a government inquiry found that the sponsor had failed to comply with financial management requirements, leading to the resignation of the then chairman Lord Bhatia.A recent Yorkshire Post investigation showed E-ACT had taken £2.9m out of its four schools in their  region while paying its former director general Sir Bruce Liddington almost double the Prime Minister as well as six-figure salaries to 15 members of staff.Sir Bruce Liddington, the former schools commissioner received almost £300,000 in 2010-11 in pay and pension contributions, making him one of the highest paid people in education. He was also forced to pay back expenses after it emerged that he claimed for a stay in a luxury hotel.

The EFA report describes E-ACT's systems of internal financial control and controls over expenses for trustees as "weak". It added that some payments "have tended to extravagance". In particular, the EFA is critical of:



•             monthly lunches at the prestigious Reform Club - a private club in London.

and – in one case – the submission of a £213 alcohol bill;



•             first-class rail travel for senior executives in defiance of a rule that employees should go standard class.



•             A £5,406 bill to use the four-star Bloomsbury Hotel in London for a “governance workshop and board meeting”, including an evening meal and overnight stay for some staff;



•             The use of first-class rail travel in contravention of the organisation’s rules and a business flight to Dubai



•             £15,990 spent on an annual strategy meeting in at a business centre in  Hertfordshire including a meal and drinks bill of £1,000



•             expenses claims and use of corporate credit cards indicating a cultural of hiring prestigious venues for meetings.



•             a "governance workshop" for ten people at London's Bloomsbury Hotel costing £5,406.



•             spending £393,000 on "procedural irregularities" including paying a significant number of its trustees

(E-ACT is a charity) as chairs of governors or trustees in contravention of guidelines by the charity Commission which state that trustees should not have a financial interest in the organisation.

Just what did Barnet think they were doing, without checking out this record? Yet again Barnet Conservatives have fallen down on the job, of protecting the public’s money and using it wisely. Hopefully it is not too late for them to get out of this  entanglement and to sort out  proper and robustly researched arrangements  for this badly needed new school.
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