The Commons Public Accounts Committee is right to report on academy finances. In particular, the recommendation that the Department for Education should tighten the rules in the next version of the Academies Financial Handbook, expected in July 2018, to prevent academies from entering into related-party transactions without approval from Education and Skills Funding Agency is very welcome.
However, the language of “excessive salaries” related to CEO pay is not helpful, as it creates the impression that executive pay in the academies sector is out of control. It is not.
The report acknowledges that 96 per cent of academies do not pay anyone over £150,000.
The threshold of £150,000 is also unhelpful. This is supposedly benchmarked against the prime minister’s pay. But the prime minister does not earn £150,000. The package for holding this office is, in fact, much greater.
Why do we benchmark public sector pay in this way?
It is obviously the case that this is public money. And we need to ensure that any public money is spent responsibly and that the outcomes are for the common good.
But it is hard to make the case that salaries are ”excessive” without understanding the context of each trust - the size of the trust being one consideration. Multi-academy trusts can be large, complex organisations, although not all are.
The need for strong governance
There is undoubtedly more to be done - I am certainly not defending all pay decisions made by academy trusts. Strengthening governance is absolutely key if the emerging landscape of multi-academy trusts is to be successful.
I am, therefore, pleased that FASNA has been awarded a DfE contract to deliver a governance leadership programme.
Strong governance is essential in the commercial, public and third sectors, but it is arguably most important in the public sector, where we are ultimately accountable to the people and communities we serve.
The notion of public service needs to be reclaimed and celebrated in our sector. School leaders are in the business of public service - our moral and ethical accountabilities are very significant, considering that we are responsible for the education of the children and young people of the nation. There can be no greater call to service.
It is now a truism to say that the quality of an education system cannot exceed the quality of its teachers. I would propose that the quality of an education system cannot exceed the quality of its leaders. We do need to pay our teachers and leaders in a way that reflects the considerable responsibility they hold. Pay should certainly not be excessive, but equally, we need to understand that the landscape is changing, educational leadership is changing and pay needs to move in a way that is proportionate to these changed responsibilities.
The solution to the problems identified in the Public Accounts Committee report relate directly to strengthening governance so that responsible and proportionate decisions are made about executive pay.
Most are doing exactly that.
Leora Cruddas is Chief Executive of FASNA. She tweets @LeoraCruddas
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