Galloway pursues free school 'fraud'

A highly-critical investigative report into apparent fraud at one of the government's flagship free school was not investigated.

George Galloway has put down dozens of questions in parliament demanding to know why the Department of Education did not ensure that the police were called in to look at the financial irregularities at Kings Science Academy in Bradford, a free school which has been visited and praised by Prime Minister David Cameron and education secretary Michael Gove.

"The report makes clear that more than £80,000 of public money was misappropriated," said Galloway, "and the department singularly failed to make this known to the police. Instead it appears that someone made a telephone call which was logged as 'information only' and what any reasonable person having read the report would conclude as fraud was not investigated."

The Bradford West MP continued: "Mind you, if the report which was made public was handed over it would have made no sense because all of the crucial information has been redacted. And the DfE will not publish a clean one. At the beginning of this I wondered if there had been incompetence or a cover-up. Now it is clear there was both."

Friday 25 October 2013 21.59 BST   the Guardian   
Kings Science Academy             
David Cameron meets children from Kings Science Academy, Bradford, during a visit in 2012. Photograph: Anna Gowthorpe/PA

Critics who have argued that the government's flagship free school policy has suffered from weak oversight have been given further ammunition as an investigation into a pioneering free school in Bradford, West Yorkshire, found an alleged trail of misused funds, unexplained invoices and improper payments.

The report by the Education Funding Agency (EFA), the Department for Education's accounting watchdog uncovered details of sustained financial mismanagement at the Kings Science Academy (KSA) after being approached by a whistleblower in 2012.

The report was completed in May and involved tens of thousands of pounds spent before the school had even opened in 2011. But the investigation was not published until almost a year after the whistleblower's approach, as the National Union of Teachers prepared to publish its own documents about the mismanagement at the free school.

The investigation comes hard on the heels of the ongoing controversy at the Al-Madinah free school in Derby, which also involved allegations of financial mismanagement and which on Friday announced the resignation of the chair of its board of governors.

"We found serious failings in financial management at the Kings Science Academy. We informed the police who decided no further action was necessary," said a spokesman for the DfE.

The spokesman said a plan was in place to recover the misued funds, and that the school was undertaking its own investigation. "Any necessary disciplinary action is a matter for the school," he said.

Tristram Hunt, the shadow education secretary, said KSA was "another farcical episode in a string of failings" for the government's free school programme.

"Labour has long warned of the dangers that a lack of financial oversight and allowing unqualified teachers to teach in our classrooms on a permanent basis would cause."

The DfE report lists a litany of allegations, ranging from the petty to the substantial, including missing national insurance payments for staff, bogus claims for property rentals and direct payments to the chair of governors that violated the school's contract with the DfE.

The investigation found that £76,933 of funds had not been used for their budgeted purposes by the school, including £26,000 in multiple claims, while £10,000 in fabricated rent invoices were included among nearly £60,000 of spending that was not supported by evidence.

The EFA report is particular damning about the failures of the school's governors, saying that they did not understand their financial responsibilities and so could not discharge them.

The report by the EFA is heavily redacted for legal reasons, while the DfE said that the school was hoping to publish the results of its own investigation shortly. The school's chair of governors, John Bowers, could not be contacted for comment.

Christine Blower, general secretary of the NUT, said: "This makes it very clear that the DfE lacks the proper procedures to manage and oversee its free
 schools programme. The audit investigation team deemed that the situation was so serious as to warrant investigation by the police.

"Michael Gove [the education secretary] is himself personally responsible for this position. The public can no longer have confidence in him or his education policies."

KSA was one of the first
 free schools approved by the DfE, and opened in September 2011 as a science-focused secondary school for up to 800 pupils between 11 and 16.

Earlier this year, Ofsted inspectors gave KSA a "requires improvement" grade in teaching and management. Although not as bad as an "inadequate" judgement, it still triggers further inspections and further action if the school's performance does not improve.

The DfE defended its actions regarding KSA, saying: "Academies
 and free schools are subject to tougher financial accountability measures than maintained schools. Unlike maintained schools, academies must have their accounts externally audited.

"Unfortunately no system of financial accountability for any school can guarantee it will prevent all wrongdoing. We take swift action when concerns are raised – academies and free schools cannot hide from their financial responsibilities and are held to account for their actions."

A DfE spokesman said KSA now had a new financial policy in place, which was being monitored, while an experienced finance director had been appointed.

"Actions have been taken to significantly restructure the governing body and recruit governors with the necessary skills. The financial management systems and procedures have been overhauled to ensure proper accountability for public money," the DfE said.

At Al-Madinah, established as an Islamic free school, the chair of the school's trustees announced her resignation on Friday, saying it was for the best interests of pupils.

A joint statement from a consortium of Derby's Muslim community groups called for the school's
governors and trustees to be replaced.

"We believe the position of the trustees and the governing board has become untenable, the vision and principles on which they 'sold' the school to the parents, pupils, central government and the wider community have not been adhered to."