Government bids to clear up confusion over PFI contracts and academies

The government has tabled an amendment to the Education Bill in a bid to clear up confusion over whether a local authority can continue to make payments under a pre-existing PFI project contract where a maintained school has converted to an academy.

The move comes despite an opinion given to the Department for Education by Tim Kerr QC of 11KBW which expressed the view that contractual arrangements of that type would not breach s. 6(2) of the Academies Act 2010.

The Act says a local authority “must cease to maintain” the school on the date on which the school opens as an academy.

The issue is reported to have led to delays in the conversion of at least 16 schools to academy status.

In a statement on its website the Department said: “The current law does not prohibit local authorities from contributing to the expenses of academies whether in money or in kind (since this does not amount to ‘maintaining’ the school), but the government wishes to put the matter beyond doubt.”

The amendment, which will come into force when the Bill receives Royal Assent, states that the prohibition on maintenance in section 6(2) of the 2010 Act does not prevent a local authority from:

• making payments in respect of some, but not all, of the expenses of maintaining the academy;
• providing premises, goods or services for the academy or
• making available premises, goods or services for use by the academy.

Philip Hoult