Oral evidence: Academies and maintained schools: oversight and intervention, HC 735

Oral evidence, 17 November 2014.

Witnesses

Chris Wormald, Permanent Secretary, Department for Education, Sir Michael Wilshaw, Her Majesty’s Chief Inspector of Education, Children’s Services and Skills, Ofsted, and Peter Lauener, Chief Executive, Education Funding Agency, gave evidence.

Chair

Welcome. Thank you very much for coming. I particularly thank Peter Lauener, because it was a late invitation. On the back of the Durand report and reading the NAO Report, I thought it would be absurd to have a hearing without you here, so thank you for that. Can I make a plea to our witnesses? We have got a heck of a lot to get through this afternoon so it would be really helpful if we have short questions and answers. If I interrupt you, it is because I think you are trying to use the time to speak and not really answer. Let us have as tight answers as we can. I am going to start with Sir Michael on a general point about all schools. One thing that the NAO Report tells us is that one in six schools—about 15%—have not been inspected in the past four years. When they looked at the schools that you had rated as inadequate in 2012-13, they found that 36% of those had previously been either good or outstanding. What do you take from that?

Sir Michael Wilshaw

That schools can improve without an inspection or formal intervention, if the quality of leadership and governance is good enough. Something like a quarter—

Chair

I think you have misunderstood my question. I am sorry to interrupt. Let me say it again. I think we will come to that very interesting area, which the NAO does report on. I was looking at the fact that one in six schools has not been inspected in the past four years. The Government have now said, as I understand it, that outstanding schools will never be inspected until a whistleblower or somebody emerges and there is a problem. The NAO looked at your inspection results for 2012-13 and found—correct me if I am wrong, Tim—that of schools that were rated inadequate in 2012-13, 36% had previously been good or outstanding. What I am driving at is not so much what makes a good school, but the role of inspection—hence you—and whether not inspecting schools for a long period is a good idea, or whether this direction of travel of not inspecting outstanding schools is the right way to go.

Sir Michael Wilshaw

Not inspecting schools for a lengthy period of time is not a good idea. Over 60% of schools are good; 20% are outstanding. We made it clear that five years between inspections for a good school is too long. A lot can happen in that time, as we all know. That is why, as I suggested, we are going out to consultation between now and September 2015 on more frequent and shorter day-long inspections. Those would be led by Her Majesty’s inspectors into good schools for one day, with half a day given over the following morning to parents and governors. That would be just to sense whether that good school remains good or not. We have something like 800 schools that decline from good to less than good each year. If our system is going to improve radically, the inspectorate and others have to identify decline much more quickly than we do at the moment. That is why we are moving to a different inspection model of good schools in September. I would just add to that by saying that if inspectors see steep decline, then they will call for a full inspection with more inspectors coming in.

Chair

Perhaps Chris can tell us. The policy on outstanding schools is that they will not be inspected. You shook your head when I said that. Am I wrong?

Chris Wormald

No. Only about the bit that that is now the direction of travel. It was set out in the 2010 White Paper and was in the 2011 Act and was implemented by regulations in 2011, so it has been the situation for some time. I was not disagreeing factually with you, no, only with the timing.

Chair

To bottom that out, you have concerns. If we look at the Trojan horse issue in Birmingham, two of those schools were outstanding, weren’t they?

Sir Michael Wilshaw

Yes, and they declined very quickly to inadequate when we went in.

Chair

What should we have done to intervene more quickly, accepting the resource constraints, because that is part of the reality in which you have to operate? In an ideal world, you would like to be given the power to inspect outstanding schools.

Sir Michael Wilshaw

Yes—

Chair

With a very light touch. What could have happened in Birmingham that would have got us involved a little bit more on the two outstanding schools?

Sir Michael Wilshaw

Local oversight is absolutely critical. Inspection can only do so much. Even if we inspected more regularly, we can only pick up so much. If it is a local authority school, it is really important that the local authority has a handle on what is going on between inspections. If it is an academy or free school, the Department should have a handle on what is going on. Those schools in Birmingham were outstanding. One school went from 20% five A* to C to 80%. We looked at the evidence base that formed that outstanding rating and it was secure. Once that school went into the outstanding bracket, the governors saw that they had the opportunity to do what they eventually did. That is why some organisation—whether the local authority or the Department—must have a handle on what is going on between inspections to pick up on things that are sliding.

Mr Burrowes

But since 2011, there has been no wide-ranging review of local authority performance to see whether they have the capacity for oversight of school improvement. The Department does not know.

Sir Michael Wilshaw

Well, in terms of school improvement, we do a bit of that. If it is school that is less than good, we have HMI on it, whether it is special measures or requires improvement, but we rely upon other bodies to do the school improvement process—

Mr Burrowes

But it is just 11 since May 2013?

Sir Michael Wilshaw

Eleven local authorities, yes.

Mr Burrowes

In 2011, 146 authorities were reviewed, with 80% showing areas of concern. Since then, we do not know whether they have responded to that or whether the situation is good, bad or ugly.

Sir Michael Wilshaw

We are going into the weakest local authorities, the ones that appear at the bottom of our league tables that we publish in the annual report every year in terms of local authority performance. We are going into the weakest ones to see what is going on. We not only go back into the underperforming schools in that local authority, but go into the local authority and ask questions of its school improvement service.

Mr Burrowes

We are learning from others, but we don’t know which ones are doing well. That is for the Department to deal with. We don’t know which local authorities are good at school improvement.

Chris Wormald

We know quite a lot. As Sir Michael says, he does inspect local authorities. We look at a lot of local authority data. Quite a lot of research is done on what local authority good practice does, but we have not done the kind of thing that you are describing. We have not done a full review of what the local authority landscape looks like, but we know quite a lot.

Chair

Can I just go back to Birmingham? I thought that you were going to go in and inspect all the schools. Have you decided that you are not now doing that?

Sir Michael Wilshaw

Inspect all the schools in Birmingham?

Chair

Yes. All the ones—

Sir Michael Wilshaw

We have inspected and re-inspected 21 of the schools in Birmingham. We are keeping a monitoring eye on all those schools that are in special measures or that require improvement.

Chair

Is it right that you think that there is still much poor practice going on unchallenged in some of those schools?

Sir Michael Wilshaw

I don’t think we have seen the end of the Trojan horse issues, which is why I have been clear that Birmingham must step up to the plate and monitor what is happening in its local authority schools much more effectively. That is why the Department must ensure that the new trustees and leaders of the schools that we put into special measures do a good job.

Chair

The Prime Minister quite appropriately promised a robust response. If we are still getting too much poor practice—that is the assertion from Ofsted—what does the Department intend to do?

Chris Wormald

This issue was discussed extensively at the Education Committee with my Secretary of State, who set out exactly what the Department was doing. I think that Sir Michael is completely right. This story has a long way to go. If you read the Peter Clarke and the Kershaw reports into the events in Birmingham, a lot of what was going on went back for at least a decade if not more.

Chair

What are you doing, Chris? Let me repeat the question. What are you doing?

Chris Wormald

I was agreeing with Sir Michael. The biggest thing we did—you can look at the full range in the Education Select Committee hearing—was to appoint one of Sir Michael’s illustrious predecessors, Sir Mike Tomlinson, to work with the local authority as a commissioner for the 19 local authority schools. He is doing that work intensively. For the academies, we have replaced the academy trusts that were running those schools, so we have action in place on all the schools identified by Ofsted and Peter Clarke. What I was agreeing with was, given the deep-rooted nature of the issues, it will take a while before we have put right all the problems.

Sir Michael Wilshaw

I have been to Birmingham on several occasions now, to talk to head teachers and governors and to go into a number of the schools that were the focus of the Trojan horse investigation. There needs to be a greater sense of urgency. It is astonishing that the local authority has not produced an action plan, and what they call their integrated plan to address the Trojan horse issues from March is still not in place after something like the 13th or 14th draft. I found it astonishing that in the Park View trust, the action plan had not addressed the key issues that we raised when we put that trust into special measures in May or June. My view is that these are very serious issues that affect not just those schools but others, and that the local authority, the trustees and the Department have got to act with much greater urgency.

Chair

Do you want to respond to that? I want to say something about Peter Clarke’s words, which will take us on to the more general.

Chris Wormald

Sir Michael is right to call for urgency. A number of the things we need to do—certainly on the academies—unfortunately do take quite a bit of time, in particular around a variety of staffing changes. So I completely agree with his call for urgency, but unfortunately some of these things do take a while.

Chair

What do you mean? Sacking people and bringing new people in?

Chris Wormald

They are a series of matters for the trust, but there are a number of legal things that have to be gone through.

Chair

In the meantime, kids suffer.

Chris Wormald

Yeah, well, as you know, the law is the law.

Chair

Let me go to what Peter Clarke actually said in his report to you. One of the things is, “Whistleblowers have been important to this inquiry, both in giving the Department for Education early warning of problems at the academies and providing extremely valuable information to my team… Those whistleblowers had to take, and are still taking, risks in coming forward.” This is the key bit: “It is not right that the Department for Education and the Education Funding Agency should be so dependent on whistleblowers for spotting serious problems. The Department for Education should consider its response to complaints and whistleblowers regarding academies, and use its powers to investigate more quickly and effectively where allegations about governance are made.” The reason I raise that is we have had this discussion in previous discussions with Peter Lauener. I do understand how, when you get a whistleblower, on the whole you respond, but it is not good enough—it is not a good enough system—to have academies assessed as being outstanding, therefore nobody goes in; very little oversight of the trusts from you and insufficient oversight of the local authority schools from the local authority; and you then just depend on a whistleblower, if you are lucky. All our experience here with whistleblowers is that you have got to go a really long way to have the guts to do it.

Chris Wormald

Yes. I will not shy away from it: this is a very big challenge. As Sir Michael has set out, two of the schools in question—two academies—had been inspected very recently and found to be outstanding. Where you have a situation as Sir Michael described where some things change very quickly, that is quite a challenge. Now—

Chair

But you only knew about it through whistleblowers.

Chris Wormald

Yes, in that case. As you know, we have changed our arrangements really quite substantially very recently, with the introduction of regional schools commissioners and head teacher boards, with the idea that we do have enhanced arrangements locally for how we look at schools in between inspections. Now, I am not going to promise anyone that that guards against some of the things we have seen, which, as Sir Michael has said, are happening very quickly indeed in schools that were judged very recently to be outstanding. That is going to be a challenge for any system of oversight.

Chair

How many regional commissioners do you have—nine?

Chris Wormald

Eight.

Chair

For how many schools?

Chris Wormald

About 4,500.

Chair

Do you think that is enough, Sir Michael?

Sir Michael Wilshaw

It is going to be a challenge. They have 15 local authorities each and thousands of schools, so it is going to be a challenge. We wait to see how they do and how they operate, but it seems to me fairly inevitable that if it is going to work well they have to work with local authorities, which should know what is happening closer to home—if they are a good local authority they will. They should work with local authorities but also with Ofsted regional directors as well, to make sure they know what is happening.

Mr Burrowes

It does not look good, when we see what was going on in Birmingham, given the risks and the urgency that is needed now to follow through with action plans. That is not happening. Despite the spotlight, the concerns expressed and the inquiries and reports, we still are not seeing urgent progress in that situation, let alone in all the others that do not necessarily come to light in such a grand fashion. What are the risks of the delay that is taking place because of legal processes? Sir Michael, what would you say?

Sir Michael Wilshaw

There are great risks. I was talking to my regional director this morning about other schools in Birmingham where she feels similar sorts of things may be going on. These risks are there, so Ofsted is relying on the local authority to monitor what is happening very carefully, produce an action plan and ensure that they have their ear very close to the ground on particular issues in particular schools. If my regional director knows that things are going wrong in a few schools, so should they.

Mrs McGuire

You mentioned the head teacher boards in passing. Could you describe the powers they have?

Chris Wormald

The head teacher boards are advisory to the regional schools commissioner. The regional schools commissioner exercises powers on behalf of the Secretary of State. They are not independent—they are civil servants operating under the Secretary of State—but they use the Secretary of State powers. The head teacher boards—

Chair

So they are not educationists?

Chris Wormald

They are. We recruited them individually to be education experts and they are extremely eminent people.

Chair

You have eight of these peak personages doing 4,500 schools, so they do not really know what goes on in schools.

Chris Wormald

They are each supported with a board of outstanding heads drawn from the local area, whose job it is to support the regional schools commissioner.

Mrs McGuire

That doesn’t actually tell me what they do; it just tells me that they support. What does that mean? Have they got powers to drop into each other’s schools and wander around the corridors to see what is happening?

Chris Wormald

The person who has the powers is the regional schools commissioner. They are advised by outstanding local heads.

Mrs McGuire

How do these outstanding head teachers get to know what is happening in schools that are not so outstanding?

Chris Wormald

They have all the normal sources of information, which include local knowledge, published inspection data, published performance data and their own knowledge of the evidence. We have not created a new inspections system to go with regional schools commissioners—

Chair

Chris, your attitude is schizophrenic here. If you look at page 19 of the Report, in paragraph 1.13 it says that you do not want local authorities to monitor academics proactively and they are not allowed to require academies to provide performance data. On the one hand, you say, “Don’t get involved.” Now you are saying that you have these excellent heads—in my authority I have so few of them that I want them to focus on maintaining those schools well rather than getting involved in other stuff—yet you want to improve the information and get a little bit more local knowledge. You cannot have it both ways. Let me restate it. If you do not allow local authorities to monitor academies proactively and they are not allowed to require academies to provide performance data, how can you, at the local level, with eight people, expect to have the sort of information to be able to intervene if things go wrong à la Birmingham?

Chris Wormald

Let’s be absolutely clear. We were discussing the situation in Birmingham, where, as Sir Michael has set out, the local authority was not the answer to the question, “Did you know what was going on?”

Chair

No, because they are not allowed to. Let me repeat again: local authorities are not allowed to monitor—

Chris Wormald

There are short answers and there is allowing me to finish. Nineteen of the schools that Sir Michael looked at and had concerns about were local authority-maintained schools. I do not think the structure of the school in question was the issue in Birmingham; the issues applied to maintained schools and academies reasonably equally. So I do not accept that that was part of the issue. Each regional schools commissioner is supported by a team of civil servants and by these head teacher boards. It is a system we have just put into place—it began in September—it will take a while to bed down and we will keep it under review—

Chair

I will just repeat again, Chris, because you have not answered the question. You do not want local authorities to monitor academies proactively—I am reading from a report somewhere—and they are not allowed to require academies to provide performance data. In that context, how on earth can all these brilliant head teachers, working with these eight commissioners, get the information they require to be able to intervene early enough to stop a school that might have been outstanding from starting to fail, or to spot the sort of Trojan horse—?

Chris Wormald

Sorry. I am really struggling with what the question is.

Chair

You don’t allow them to get the data they need—that is the question.

Chris Wormald

You are talking about two completely different things. The role of local authorities in academies has been unchanged since you were a Minister; it is exactly the same.

Chair

No. I am talking about academies.

Chris Wormald

Yes. In terms of academies, the regional schools commissioner and the head teacher boards are not part of the local authority; whether the local authority does or does not have access to information is not a relevant issue. They have the same information that the Department has, which is—

Chair

Why can they not require it? If you want better local knowledge, these eight guys or women will have to work with local authorities to be able to spot what is happening in local schools. It is nonsense. All of us as constituency MPs know how our schools operate in our area, and somebody sitting in your Department for Education, or perhaps in the centre of London, will not know what is happening in a Barking and Dagenham academy school without that knowledge from the local authority. You do not allow local authorities to fulfil their role; you are preventing them from being effective.

Chris Wormald

In that we and the previous Government have followed a policy of taking academies out of local authority control—

Chair

I am not saying that at all; that is not answering the question. Sorry.

Chris Wormald

I’m terribly sorry. But I don’t understand the question.

Chair

The question is you ought to enable local authorities to access the information they need, so that they can be another intelligent local player in the scene, working with these eight new people that you have recruited to try to spot things early.

Chris Wormald

Oh, I understand. That is a completely different policy by the one being pursued by the Government and, yes, there are people who advocated it, but that is a policy choice.

Chair

But you have responsibility for oversight and ensuring quality, Chris, and if you don’t allow those tools to be used, you are not fulfilling your responsibility.

Chris Wormald

With respect, we set up the academy system under legislation and we implement that legislation. Could a Government change that legislation if they wanted to? Yes, they could, and they could follow a series of other policies. We apply the legislation that we have.

Meg Hillier

I am quite interested in this issue around the cost of interventions, but before that I can perhaps unpick these head teacher boards. First, local schools commissioners, what are they paid?

Chris Wormald

They are paid as civil servants, so they are paid on the director pay scale.

Meg Hillier

So, roughly?

Chris Wormald

Normally, probably £100,000-plus.

Meg Hillier

And then they have a team of civil servants, so there is a cost to the set-up of that office and premises. Roughly, what is the cost of these eight?

Chris Wormald

I don’t have the cost off the top of my head.

Meg Hillier

Hopefully, you can write to us with that.

Chris Wormald

I can find it for you, but it is all found from existing departmental resource.

Meg Hillier

So they are people who would otherwise have been in the Department, you are saying, effectively?

Chris Wormald

They are undertaking the roles that the Department previously undertook centrally, and we have found the resource from within existing departmental budgets.

Meg Hillier

Okay. Right. So they are not costing anything—

Chris Wormald

Sorry. Obviously they cost, but we have found the resources from within the Department; there are not any additional resources.

Meg Hillier

The NAO is quite critical about you not understanding the costs of different interventions. With the head teacher boards, you are going to get one head teacher from each local authority area, or not even that many—I am trying to work out the maths—as your eyes and ears on the ground.

Chris Wormald

There are eight regional commissioners and about 50 members of the head teacher boards.

Meg Hillier

Fifty in each area?

Chris Wormald

No, in total.

Meg Hillier

Okay. So they are covering at best one local authority area—one head teacher is supposed to know what is happening in their area from gossip on the ground? Is that the structure?

Chris Wormald

As I said, this is a system we have just introduced, and we will keep it under review. Just to be clear, we have gone from a situation where, prior to the introduction of regional schools commissioners, we did all these roles from Whitehall. We have now significantly enhanced the system with regional schools commissioners, and we will keep it under review as the academies programme develops.

Meg Hillier

Okay, we have heard that. The key thing is, though, that it would be quite a challenge for one head teacher in Hackney—say, Sir Michael, when he was in Hackney—to know everything that was going on in every primary and secondary school.

Chris Wormald

We are not asking the head teachers to do that. They are advisory to the regional schools commissioner. The Department has at its disposal a range of data, as it always has, on school performance and inspection, as well as all the financial information the EFA collects. That will be the main source of information.

Meg Hillier

So you are saying it is too early to have done an analysis of whether this approach is cost-effective?

Chris Wormald

Absolutely. It has been in place for two months.

Meg Hillier

So will you be doing an evaluation?

Chris Wormald

As I say, we will be reviewing this model as we go.

Meg Hillier

Will you be looking at the cost of local authorities doing it versus the cost of this model? In my borough, the Hackney Learning Trust is now part of the local authority, having been outside it, and they know exactly what is going on in every school, because they make a particular point of having that relationship with the family of local schools, whether they are academies, free schools or whatever. If they are doing that—if you have a good local authority—having a regional schools director is a bit superfluous.

Chris Wormald

Except that you are talking about two different categories of school. Hackney Learning Trust does that for its maintained schools—

Meg Hillier

No, it does it for every school. The family of Hackney schools all co-operate with a regime that means that there is a connection with the council. That is a very important priority locally.

Chris Wormald

And there are a number of local authorities where they and their academies work that way. The regional schools commissioners are very specifically exercising the powers of the Secretary of State in relation to academies.

Meg Hillier

Have you done any analysis of the patchiness of this? I have had issues with academies—for instance, on whistleblowing—but going to the regional director if there is a problem is quite a long way to go, whereas doing things much more locally is quicker and less bureaucratic, and things can sometimes be nipped in the bud at an early stage. The system that has been created seems to be adding more layers of bureaucracy at each step of the way, rather than working with what is already there, which is the local authority set-up.

Chris Wormald

There are people who make that case, but that is not how we see it. What we are trying to create here, as we have discussed with the Committee before, is a system of autonomous schools that largely get on with things themselves. The question we ask ourselves is, what is the minimum that we need to maintain oversight of that system so that we can spot where things will go wrong without undermining the basic principle of the system we are creating, which is that it is the autonomous school that gets on with things? Now, I know you are arguing for a different model of school improvement, and there are a number of people who do, but that is not where the Government is.

Meg Hillier

We have an elected mayor in Hackney. He has put a high priority on 70% of children in my borough getting five A to C GCSEs including maths and English by 2018. He is, effectively, the local schools commissioner, because he has set a clear tone to everybody working in education in Hackney.

Chris Wormald

I am not going to comment on that, because you obviously know a lot more about Hackney than I do.

Meg Hillier

But I am saying that that is strong leadership from someone who is elected and accountable.

Chris Wormald

As I said in my letter to the Committee, there are two models around the world of how you do school improvement—

Chair

I do not want to get on to that at the moment. I think it is an intellectually incoherent letter. We all believe in autonomy, but autonomy requires good regulation. What we are testing this afternoon is the regulation.

Meg Hillier

May I go to the issue in the NAO Report on the effectiveness of interventions? In paragraphs 14 and 15 on page 9, it is pretty clear from what the NAO has uncovered that the Department does not really know about the effectiveness and costs of different interventions. We are looking at value for money here, and this worries me. For example, according to paragraph 15, you have looked at the grant approach, but you have not collected data on the costs of other interventions—that is highlighted in more detail in paragraphs 3.20 to 3.25. Why not? Shouldn’t that worry all of us? If you or your commissioners are going to be the monitoring body, the data is not there to do that.

Chris Wormald

There is undoubtedly more we can do in this area, but largely we look at the effectiveness of the interventions that we carry out and then we evaluate over time. We do have—even if you did not like my letter—a large amount of international evidence on what the most effective things are.

Chair

Have you got any evaluation in the UK? That is the main criticism of the NAO Report. Where is the evaluation of your interventions to show us that you are getting value for money in the UK?

Chris Wormald

A number of the studies that I pointed to in my letter were in the UK. We also do analysis, and have done for many years, of academy results versus other results. There are a number of studies of school intervention.

Chair

Can you point us to an evaluation of intervention and oversight in the current regime in the UK that shows value? Can you point to one for me?

Chris Wormald

There are a number of studies about the effectiveness. They are in my letter.

Chair

Name one.

Mrs McGuire

Can I say while you are checking that there is no such thing as a British academy programme?

Chris Wormald

I think I was quoting from research.

Mrs McGuire

For the sake of clarity.

Chris Wormald

I was quoting from research. That is a mistake. I was referring to the British Government—

Mrs McGuire

There are four different education systems within the UK and we need to be clear which one we are talking about.

Chris Wormald

I think—

Mr Jackson

They are all still British, though.

Mrs McGuire

Even since 1707 we have had different education systems.

Mr Jackson

I am well aware of that.

Chair

Let me put one to you that is mentioned in the Report. The Sutton Trust is a highly esteemed, totally non-partisan organisation that I have had a lot of time for down the years. They have done a lot of good work. They looked at the sponsored academy chains. Their conclusion is mentioned in the Report. They did a very fair thing and looked at only those that had at least three academies and they looked at those that had had control of the schools for at least three years, so they could really judge whether there had been any impact. Their conclusion was that there are five chains that are promoting high attainment for disadvantaged pupils, and indeed for pupils of all types across a whole range of measures; however, there are also some chains that are highly ineffective across a range of measures and are failing to improve prospects for their disadvantaged pupils. In their report, they actually name them, list them and measure them right across a whole range. That to me is clear evidence, which I did not see in your letter, of the sort of data you should be looking at to decide whether our system of oversight is sufficient to ensure we really improve the quality of education for children, wherever they are educated in whatever sort of school.

Chris Wormald

Yes. As you say, the Sutton Trust is a highly reputable organisation, and we take its views very seriously.

Chair

So what are you going to do with that?

Chris Wormald

I will ask Peter in a minute to explain what we are doing around academy chains, where, as the Sutton Trust rightly point out, there is variable performance. If you want a single piece of evidence about our system, I think probably the best is that which the OECD and Andreas Schleicher gave to the Education Committee on the English academy programme.

Chair

That was across the system. I am looking specifically at the academy chains.

Chris Wormald

We are talking about two slightly different things, but you wanted a single piece of evidence. We do not disagree that the performance of some academy chains has been variable. There have been a number that we have taken action on, which Peter could describe if that would be helpful.

Austin Mitchell

Why not allow Sir Michael to inspect the academy chains in the same way as he would with local authorities?

Chris Wormald

This is a long-debated question. The other thing that I thought it would be helpful to copy to the Committee was the Secretary of State’s letter to the Education Select Committee, which sets out the Government’s position on that.

Austin Mitchell

Sir Michael clearly wanted it. We have your letter to the Minister, and the last paragraph states that “my preferred approach was to publish an inspection framework” for the chains that “would have set out the principles and inspection methodology, ensuring transparency for everyone.” You have obviously written that through gritted teeth, Sir Michael. Why would you have wanted to inspect the chains?

Sir Michael Wilshaw

I wanted the same powers as I have for local authority school improvement services. I have discussed that with the Secretary of State and with the Department as well. I accept that the Secretary of State has a different view; she feels that my existing powers are sufficient. What we are going to do is we will continue with our inspection of academy chains—we have inspected four underperforming ones up to now, and we will do some more after Christmas. We will choose a batch of underperforming schools within that chain and interview the head teachers of those schools and the chairs of governors; we will also ask the chief executive of the academy chain to answer various questions that we want to put—the same sort of questions that we put to the chief executives of local authorities. I am sure that they will be co-operative, that they will come along and answer those questions.

Austin Mitchell

Will you get enough information from the batch to comment on the effectiveness of the chain?

Sir Michael Wilshaw

Yes. We will know how those schools are doing and we will know what the head teachers are saying about the level of support and challenge they are receiving. On the basis of that, we will want to see what the central services are doing to support and challenge. I am sure they will co-operate. A situation may come up of a chief executive saying, “Where is your framework? Have you gone out to consultation on this? Why did I not know what sort of questions you were going to ask me?” That is when I have to review it and talk to the Secretary of State about that sort of issue.

Chair

I will come to Peter in a little bit, but I want to ask you one question, Sir Michael. You ran a fantastic school. It was a terrific academy, and those of us who were outside the catchment area desperately tried to get our kids in there and never did. You know what works. When we look at where we are in the development of academies, more than 4,000 now exist. It is fantastic. The growth between 2011-12 and 2012-13 is massive, looking at the Report. What do you think that has done to education? There is a growing body of evidence on failing academy chains, failing academies and whether converter academies improve things. What do you think has happened? What is your take on that? Have we gone too far, too fast? Have we tried to do it too fast?

Sir Michael Wilshaw

Just very generally, on the whole issue of autonomy, I come from an academy background, and the reason why I applied to become an academy principal was that I wanted more autonomy, not less. I am very much in favour of giving schools the power, resources and autonomy to do what is necessary. I think that the academy programme has energised the system by bringing in different providers and expertise from outside. Some of these academies have gone into the toughest schools in the most difficult areas—in Hackney and elsewhere—and improved them. We, the Department and the regional commissioners have to ensure that that steep trajectory of improvement in those toughest areas continues. We are seeing a bit of plateauing with that at the moment, and some sliding back into “requires improvement” and underperformance. It is really important that the improvements we have seen in the toughest areas continue. At the end of the day, it is about leadership. Schools improve when they have good leaders, academy chains improve when they have good chief executives and local authorities do well when they have similarly good leadership. The big challenge for our country, particularly if there is a more autonomous system, is to develop great leadership in our schools. As somebody who has been in the game for a long time, I have to say that up until now we have done it really badly. We must identify talent early on. If we were a Marks and Spencer, a BT or a big corporation, we would identify our potential leaders at an early stage, invest in them, train them and put them into leadership positions when they become vacant. However, we do it in an amateurish, unprofessional way. If we are going to improve our system as it becomes much more autonomous, we need a system for fostering better leadership in our schools.

Austin Mitchell

What causes them to go off? You told us about improvement, but if the outstanding schools are subject to only light-touch inspection, they can go off, can’t they?

Sir Michael Wilshaw

Autonomous schools, particularly if they are isolated and stand-alone institutions, are vulnerable because there is no one there to support and challenge them if there is a weak sponsor or weak trustees. There is no one there to spot decline, and challenge and support them when necessary. That is the great danger.

Mr Jackson

What can they do if that happens? I discern a slight difference of opinion between you and the permanent secretary. I have an example in my constituency of a very large academy. It was one of the first-wave academies, which were subject to the Education and Inspections Act 2006—I think that was the legislation. It was very difficult for the local education authority to take any practical action on its reduction in attainment and the poor quality of its leadership. I hear what you say, but what is the answer? Do we need to look again at the legislation for the first-wave academies? You identified the problem, but what is the practical way of dealing with it? The academy in my constituency had a weak sponsor and, frankly, a pretty weak governing body.

Chris Wormald

I don’t think Sir Michael and I disagree. We have worked together for a long time and we don’t agree on everything, but on this we do. The nature of the challenge was different a decade ago. When the previous Government first introduced floor targets in 2003, it was for 20% of pupils to get five A to Cs, not including English and maths. At that point, there were 112 secondary schools at that level. There are currently zero, and the floor standard is 40% of pupils to get five A to Cs, including English and maths. Successive Governments and chief inspectors have raised the bar of acceptable performance, which is a great success of the whole system and everybody who works within it. Our challenge now is not the types of schools that we dealt with in the 1990s and 2000s, but the schools that are sort of okay and are coasting slightly—those that Ofsted, prior to Sir Michael’s reforms, counted as “satisfactory”. That is our big challenge. The biggest single thing that we have done is Sir Michael’s changing those schools to “requires improvement”, rather than satisfactory. That is also why we changed the wider accountability measures. I don’t accept the language of slipping back, because we are nowhere near where we were when the system began to take school improvement very seriously. It is a different type of challenge.

Mr Jackson

These things take time. That is the key thing. You correctly analysed the problem, but you didn’t come up with a solution except to say, “We’ll deal with it.” If the principal of an academy is failing, it can take two or three years for that failure to become apparent, which will have an impact on educational attainment. My question to you is: do you need to change the legislation to take tougher action in the case of that first wave of academies?

Chris Wormald

It is not up to me what the legislation is. I do not quite agree with you. It does take a while to identify failure, but that is because it is frequently very difficult in education to establish good lead indicators as opposed to lag indicators. You did not ask Russell Hobby this question, but one concern of both the big teacher unions is exactly the opposite challenge. In their view, heads do not have sufficient time to turn a school around before we intervene. It is not a straightforward argument. I recognise your challenge as being exactly the right one, but there is not a simple solution. All the quantitative data that we have about the schools system are lag indicators. We do not have a lead indicator on which we could take that kind of action. It would be lovely if we did, but we do not.

Chair

The NAO Report suggests three things that you could look at: financial competence, safeguarding—

Tim Phillips

And the quality of school governance.

Chair

You may have better ideas than the NAO.

Chris Wormald

A lot of this Report was areas where Amyas and I do not agree, and we have talked about them. It would be great to have lead indicators in those areas. At the moment, we do not. No one in the world does, as far as I know.

Sir Amyas Morse

What is so disappointing is where we go from there. We do not disagree about very much, to be quite honest. It would be really great to try to develop them instead of just sounding quite happy about the fact that we do not have them.

Chris Wormald

I am not happy about that fact at all. I am perfectly happy to look at whether those are possible. However, just saying that we need a lead indicator on safeguarding does not wish one into existence. A lot of people have looked at this question and it is extremely difficult to come up with a lead indicator on safeguarding.

Chair

It might be, but if you had had something on safeguarding, you might have twigged what was happening in Birmingham.

Sir Michael Wilshaw

That is exactly right. I remember the leader of the council in Birmingham saying, “Why should I know anything about the academies in Birmingham? They are nothing to do with me.” Yes, they actually do have something to do with you, because you are responsible for safeguarding in those schools.

Chris Wormald

Yes, I completely agree with Sir Michael. I am making a slightly different point, which is that no piece of data currently exists which would give you a lead indicator on safeguarding.

Chair

There might not be a lead indicator but everything you do is judgment. This whole Report is filled with your judgments about when and how to intervene. Stewart quite rightly asked how we can identify earlier where a school is starting to go wrong. It does not mean that you get one indicator as a measurement of safeguarding, but you look at the safeguarding capability.

Chris Wormald

Sorry, I am not disagreeing with the challenge you make, but you are stereotyping my answers. Yes, we do want to look at all those things. I am saying that it is extremely difficult and that we have found no one anywhere in the world who has cracked those things. I accept that that is exactly the right challenge. I am saying that it is not a quick fix to create that system. I do not think we are actually as far apart as you are making out.

Mr Jackson

I do not think you are understanding the basic concept—people in my constituency would probably elucidate this more pithily than me—that it is public money. Why do you wait three years? I will not name the school, but in the example that I mentioned, that school was performing at 28% below the national average for maths within about three years. I am a very strong supporter of academies. You do not hear me saying this very much, but it was one of the best things that the Labour Government did. One of the best things that Tony Blair did was introducing academies to drive up standards and help children in lower socio-economic groups to meet their potential. I am not against academies, but the point is that there must be a way to quickly spot and firefight poorer performance. I see it from a different point of view. I am not anti-LEA. Some LEAs do have the local knowledge and could assist the Department, but do you need regulations to change this rather than primary legislation? Children’s education is suffering in those two or three years.

Chair

I’m going to bring in Peter to answer the question because he has had his hand up for ages.

Peter Lauener

Thank you, Chair. I have been trying to get in to say something about data, because I think that, in the end, a lot of this is about data, how data is used, and how you get as much early warning as you can in an imperfect data world. Over the past year we have been developing what we call a risk-assessment tool—we have been putting all the data we have into a tool. We use data on budget forecasts—whether an academy is in deficit—and on the timeliness of returns, which has been much discussed in this Committee, because basically we think that if an academy is getting its returns in on time, it is going to be well organised and well managed. And we obviously look at education performance and what Ofsted is saying. We look at pupil numbers and whether they are going up or down, and at any soft information we have from investigations and from whistleblowers—another issue that we have discussed in this Committee. We are looking at other data sources, such as whether there is churn in trust governing bodies—you might want to ask me about it later, because this Committee has taken a great interest in that. We are compiling data on when there are changes in trustees, accounting officers and so on. We are also looking at the number of complaints that we get about academies. We are putting all that into a risk assessment process—a data-analytic not dissimilar to the kind of tool that financial sector companies use to generate not the answer but a series of data points, or of academies, that come out looking a bit odd and in need of another look. We would then sit down with the regional schools commissioners and ask whether they had any other relevant soft intelligence. We are working towards the kind of system that Committee members are talking about, but we have quite a bit to go on. I would like to make one last point. One example of a dataset that we have been looking at recently is parental preference—if a school is not doing well, parents are going to move their first preference away to other schools. We have just got data on that and there is quite a strong correlation with later financial deficit problems, so that is a big one for us if it will give us advanced warning of upcoming deficit problems. That is the kind of thing that we are doing to try to improve the data underpinning for everyone in the system.

Chris Heaton-Harris

There are other tools, aren’t there? The Sutton Trust paper that Margaret referred to has a graph showing whether academies have below average attainment but above average improvement, or vice versa, so you can plot these things. Although I understand Mr Wormald’s point about safeguarding, I do not really agree with there being any other reasons, because you, Mr Lauener, should be able to spot the finance rule issues, and the academic issues are pretty much there for everyone to see.

Chris Wormald

I agree with that entirely. I think we are talking at slightly cross purposes. I was making a specific point about safeguarding and then a separate point that although everything that you say about the analysis result is true, it does not give you a lead indicator, which is what I was discussing with Mr Jackson. It tells you how the school has performed in the past, and we have very sophisticated ways of analysing that. Mr Jackson was asking what I think is a very fair question: can we do work on predicting where results will go in future where that has not yet shown up? I think that was his point.

Mr Jackson

Yes. Rather than a draconian measure at the end of a process, which is very difficult and destabilising for the school environment, I was talking about a remedial and incremental process to try to head off trouble for the future.

Chris Wormald

That is an extremely fair challenge. I was merely making the point that, given that what we have is exam results that happen at the end of the process, it is an incredibly difficult thing to do. Nevertheless, the challenge is fair.

Sir Amyas Morse

I have spent most of my career running organisations, and of course you do not always know what indicator will tell you what—it is not a perfect world. There is a point at which you have to get out of the research room, take it out there and say, “I do not know which one of these will work, but there are a few of them, so we will put them out there and see which ones light up and work as lead indicators.” You have to get on with it a bit rather than say that it is too difficult. It is never impossible to find something that tells you when things are going wrong. You just have to take a basket of indicators—very much as Peter is talking about—try them and see which ones tend to be reliable in which circumstances. To be quite honest, the thing is to get out there and do it and see what works.

Chris Wormald

I agree with you 90% of the way on that. I specifically do not agree with you about safeguarding where the dangers of experimenting with lead indicators are—

Chair

Are you suggesting that nobody has a responsibility for the oversight of safeguarding in our academies?

Chris Wormald

No, I did not say that at all.

Chair

If you have got a responsibility, how are you going to execute it without having—

Chris Wormald

I was on the very specific point of whether you can create a lead indicator for safeguarding.

Chair

How do you exercise your responsibility, as a permanent secretary in the Department for Education, for ensuring safeguarding in all the academies and academy trusts?

Chris Wormald

Just to be very clear, we have not changed the statutory responsibilities for safeguarding at all. As Sir Michael pointed out earlier, it remains a local authority duty.

Chair

No, I meant in academies and academy trusts.

Chris Wormald

No, it remains a local authority duty to ensure the safeguarding of individuals, regardless of where they are educated, whether in an independent school, an academy or whatever.

Chair

But they’re not allowed to have the information.

Chris Wormald

Their powers on safeguarding were set out in the 1989 Act and have not changed. They use exactly the same powers for safeguarding in independent schools, academies, youth clubs or anywhere a child is present, so I do not see that as the issue. I was on the very specific issue of whether you can create lead indicators for safeguarding, and was challenging Amyas’s idea that you might experiment with some—

Sir Michael Wilshaw

Can I respond to the question about how to identify problems—the maths department is declining to such an extent—at an early stage and put it right before Ofsted inspects? We are criticising some very weak local authorities that are not doing a good job in terms of challenging and supporting those schools, but there are some very good local authorities with very little resource at the centre. They have understood that the money is not going to come their way and that they will not have lots of people at the centre involved in school improvement because the money isn’t there, and they are looking at different models of school improvement. What they are doing is organising the local authority in terms of clusters run by outstanding head teachers. They are grouping the schools in groups of five, six, seven or eight with a very good head running them and monitoring them. The local authority—if it were a group of academies, it could be the regional commissioners—ensures that the right people are leading those clusters, identifying problems at an early stage and making sure that there is good co-ordination and that it all works. If that is going to be a national model in the future as we get greater autonomy in the system, Ofsted will have a role in ensuring that those clusters of schools are working by—

Mr Burrowes

But you don’t inspect those good local authorities to help them then spread that good practice. You are telling us about it, but you have not been inspecting it.

Sir Michael Wilshaw

Unfortunately, our budget has been cut by £50 million. If I had some of that money back, we would do a lot more good practice surveys, but we have got to spend our money wisely.

Chair

Sorry, I must call the NAO. Then I will call Anne, then I will bring in Austin again.

Tim Phillips

I want to clarify something for the Committee. Chris is absolutely right, obviously, to say that the position of who is responsible for overseeing safeguarding has not changed—it is safeguarding in schools that local authorities oversee—but what we found in our analysis when we surveyed local authority directors of children’s services was that 15% told us that they were not monitoring safeguarding arrangements in academies, and 15% told us that they would not intervene directly in academies if pupils’ safety were threatened. It may be the case that that is their mistaken understanding, but we think that that is probably because of the very strong messages that have been sent to local authorities more generally about not overseeing and meddling in academies. The other thing that I would add is on the local safeguarding children board, which has the responsibility for scrutinising safeguarding arrangements. The Department’s guidance on keeping children safe in education makes it clear that academies must work with that board, but other guidance that we have seen also indicates that the board cannot direct a school to change its safeguarding arrangements. So it does seem to be unclear, in the case of academies, who would direct the school to change its safeguarding arrangements.

Chris Wormald

We are talking about two slightly different things. Your finding on local authorities surprised me, particularly as the situation has not changed since 1989 and local authorities are just as able to read an Act of Parliament as anybody else. It is very clear that—

Chair

You’re responsible in the end, Chris, for making sure they do.

Chris Wormald

Parliament has placed the responsibility for individual child protection elsewhere. It has placed it very clearly with the local authority.

Chair

You have no responsibility?

Chris Wormald

No. Under law, the responsibility for individual child safety is very clearly—

Chair

Obviously, but for the policy of a school?

Chris Wormald

What we have responsibility for—I am sure that we will debate this further on 8 December, when we will address the issue in much greater detail—is the overall framework of child protection. Academies have the responsibilities that the maintainer of any school has, to have appropriate systems in place. On the strict question of who is statutorily responsible for intervening when a child is in danger, that is the local authority working with the other statutory agencies. It has been that way since 1989.

Chair

I am astounded by that contribution. Of course we are not talking about that. The individual child is obviously the responsibility of social services, but when it comes to ensuring that there is a proper policy and set of practices in place in schools—particularly academy schools, for which you have responsibility—I don’t think you can say, “It’s not me, guv. It is all for local authorities.”

Chris Wormald

Sorry, I did not say that. It is very clear. Any maintainer of a school, whether an academy, local authority or independent school, has a set of responsibilities to discharge. If an academy or independent school is not fulfilling those responsibilities the Department has a duty to intervene. I am sorry; we are talking at slight cross-purposes. There is the individual child protection, where I would be very surprised if local authorities were confused. Then there are the responsibilities of the maintainers of the school, and us as the regulators of two parts of that, academies and independent schools, to act if there is a problem.

Chair

Anne.

Mr Bacon

Given that 15% of—sorry.

Mrs McGuire

I said that without moving my lips.

Mr Bacon

I do apologise. Because I was late, having been unavoidably detained, I did not see you there, Anne.

Mrs McGuire

Did you not? That is the nicest thing anybody has ever said to me. Can I ask a couple of questions, the first to Mr Lauener? In the letter that you kindly shared with us, which you sent to Graham Stuart as Chair of the Education Committee, you indicated that in terms of accountability the academies work under a framework that includes companies limited by guarantee, academy trusts that are also charities and academy trusts that are public sector bodies, and those elements overlap and intertwine. What work is the Department doing to ensure that those who are involved in the academies understand the complexity of the responsibilities that they have under those three headings?

Peter Lauener

I would say three things. The first is that we have set them out as clearly as we can in the academies financial handbook, which for us is the core document. It sits alongside the funding agreement because it is designed as a ready-reference source and is a list of all the requirements that academies must fulfil. The second thing is that we engage in quite a lot of direct discussion with the auditors and financial directors of academies to ensure again that they understand these things. Thirdly, we work with the associations, such as the Independent Academies Association, the National Association of School Business Management, which crosses maintained schools and academies, and FASNA—the Freedom and Autonomy for Schools National Association; I always have to think about that one. We work very closely with those associations, again because they are very good conduits to their members.

Mrs McGuire

Can I then ask, arising out of that, why the related party transactions have not been totally banned for the academy sector?

Peter Lauener

That is something that we debated at the hearing in March when we looked at the accounts and the Report on the EFA. Chris and I had very strong views.

Mrs McGuire

Forgive me, I have had a sabbatical from this Committee and I did not come back on it until April.

Peter Lauener

It is a very pertinent question, given the discussion at the March hearing, where the Committee expressed a strong view that we should consider banning related party transactions. We took that away and looked at it very carefully over the spring and into early summer. We discussed that with Ministers. We did a very thorough piece of work ourselves on the academy financial statements for 2012-13 and we published a report last Friday about that. It set out that there were quite a number of related party transactions, but in all but 17 of those we were happy that the related party transactions were properly notified and managed. We have, however, set out a number of areas in which we are strengthening the arrangements that we are implementing. I wrote to the Committee about that in August. We will keep that very closely under review.

Mrs McGuire

So you are monitoring it very carefully.

Peter Lauener

Yes. We are monitoring it very carefully. The arrangements that are in place—maybe partly because of your point from my letter, that there are three overlapping arrangements—are more restrictive than in other sectors. We have not been able to find any sector where there are greater requirements for disclosure and that where there are transactions, they should be done at cost.

Chair

The charitable sector?

Peter Lauener

No, not at cost.

Chair

But it depends on how you define cost.

Mrs McGuire

If you are a trustee on a charitable body—forgive me if I can’t quote the exact legal requirement, but my understanding is that you cannot be a trustee of a charity and deliver services to that charity at a charge.

Peter Lauener

I will check again.

Mrs McGuire

My background is in the charitable sector. So it may be custom and practice—I am willing to accept that—but there may be a legal requirement as a trustee, because then you have a potential conflict of interest.

Peter Lauener

I would expect a charity trustee in any charity, including an academy, to absent themselves from any discussions about that.

Mrs McGuire

I am not talking about absenting yourself from the discussion, but about not being part of a transaction with an organisation of which you are a trustee.

Chris Wormald

I am pretty sure we looked and there is not an outright ban in any sector that we could find, including the charities sector.

Mrs McGuire

If you are pretty sure, I would like some authentication of your pretty sure-ness, because it certainly would be exceptional. I do not think I have ever come across a situation where a trustee on a charity is actually involved in a transaction with a charity, but I am willing to be contradicted. I am sure that the Department for Education has great minds.

Peter Lauener

We will check and write to you about that, but in the report that we published on Friday, annexe D lists a comparison of policies for publicly funded bodies about related party transactions, and it gives a lot of material, but I will write to you on that point.

Mrs McGuire

Thank you. Could I just ask one other question, with your indulgence, Madam Chair? Let’s go to NAO Report paragraph 1.5 and figure 1. It shows that secondary school children had a less than 70% chance of having a good or better school place, as rated by Ofsted, in more than one third of the authorities, and that one of the indicators that was taken was the number of children who received free school meals—11% in the outstanding schools and 22% in the inadequate schools. I am sure you will not be surprised by my question: why is the availability of good schools at such variance across the country—across England, in fact—and why are disadvantaged children still more likely to attend an inadequate school, given Stewart Jackson’s compliment that academies were initially established to provide support for disadvantaged children in disadvantaged areas?

Chris Wormald

Yes, and those academies improved faster than similar schools. That is not the same as saying we have solved the problem.

Mrs McGuire

I am not asking you to have solved all the problems. I am asking you why there is still a significant number of disadvantaged children twice as likely to attend an inadequate school.

Chris Wormald

Sorry, I am answering that question. The relationship between, unfortunately—again, the Sutton Trust has written a lot about this—deprivation and educational achievement is still too great. We still have challenges, and Sir Michael was describing some of them earlier, in terms of getting our best teachers and our best leaders to work in the most challenging places. Those problems are not solved yet.

Chair

Do you want to answer this as well, Sir Michael, because I think your insights would be interesting?

Sir Michael Wilshaw

First, poor children in some parts of the country do well, or much better than they were doing—those in Hackney, those in London. London children are doing very well, as are children in parts of Birmingham, and parts of Liverpool and Manchester. Poverty is not necessarily a predictor of failure, as it was years ago. One of the big issues is a demographic one: two thirds of youngsters in what we call the long tail of underachievement—free school meals—are from white working-class backgrounds. If we crack that one, we will go a long way towards closing the attainment gap. If you look at attainment levels in those areas where there are a significant number of that demographic, you will see that in many of those schools they have not closed that attainment gap. If you read our report called “Access and achievement”, which looked very closely at the attainment gap, it makes all sorts of recommendations, including trying to get the best leaders and the best teachers—national service for teachers, we call it—into those areas, making sure that the pupil premium funding is well used there and also making sure that lethargic and complacent local authorities in those parts of the world get their act together, and that lethargic and complacent leaders get their act together. There are parts of East Anglia that should be doing significantly better with those children, and I made my views clear to a few of the head teachers not so long ago.

Mr Jackson

Peterborough had the lowest attainment of any LA for white British boys in receipt of free school meals in 2012, although it has got better now. The one group that you failed to mention, of course, is parents.

Sir Michael Wilshaw

I shouldn’t have failed to mention parents.

Mr Jackson

If children are turning up to school not socialised, not having proper conversations, not able to hold a pencil and not properly fed, it is not the fault of the teachers or the heads; it is the fault of the parents.

Sir Michael Wilshaw

I should say that the thing about those youngsters in London was that they had come from cohesive families. They may be poor, but they are very cohesive. They are very aspirational and ambitious. They want their children to do better than they did. That is not the case in some of these areas.

Mrs McGuire

What is the Department doing to try to rebalance the numbers? There is a high concentration of academy schools in some areas, and I think you are right to identify London, which appears to have been a great success story. But in other areas, as the NAO Report points out, there is just not the opportunity.

Chris Wormald

The single biggest intervention that we are making is, of course, the pupil premium. That is a significant investment in deprivation, as Sir Michael said. That will only have its greatest impact if people adopt good practice and do the various things that he was just describing. The second important part of the jigsaw is the work of the Education Endowment Fund, which works closely with the Sutton Trust, looking at what is excellent practice in closing the achievement gap. It has published a whole range of excellent research on what really works and what does not. The issue you point to is one of the reasons why we wanted to expand the sponsored academy programme. As you say, it was very successful in London, so we are doing more of that. The final thing, which we have mentioned already, is that a lot of the schools that we are talking about—East Anglia is a good example—are those I was referring to earlier that were sort of all right in inspection terms. They are now in Sir Michael’s “requires improvement” category, whereas previously we called them satisfactory. That is all work in progress, and this has been a long-term challenge of the English education system.

Chair

I must stop you, Chris, because there are loads of questions.

Austin Mitchell

I want to ask whether we are too obsessed with exam results. We are not educating our kids; we are training them to jump through hoops for the greater glory of league tables. When it comes to judging what is a good school, the Department is obsessively concerned with exam results, which have been improving for years. Before we started this tarmacadamisation of the education system, the exam results were improving at a rate very similar to that today. All the things that go to make a good school—financial management, the quality of its governance, its relations with the community, its place in the community, its good governance and its safeguarding—the Department does not know enough about all that to make any judgment on it, so it bases its judgment, essentially, on exam success.

Chris Wormald

I make no apology for focusing on exam results. Some other work, I think by the Sutton Trust again, shows that the biggest thing that we can do in terms of social mobility and the issues that we were just discussing is for more and more pupils to get good GCSEs, progress to study to 18 and go on to an apprenticeship or to higher education.

Chair

You would accept, on those exam results—but let us get a specific one. Probably in your constituency, Richard, Ormiston Victory academy in Norfolk claimed that 73% of children were getting five GCSEs A to C; that figure crashed to 43% after taking out nail technology, etc.

Chris Wormald

We have changed, as you know, what counts in performance tables for 2014—I will not comment on the 2014 results, because they are not published. We did that explicitly to focus on the subjects that the Wolf review showed to have most value going forwards; that was a deliberate act of policy. I cannot comment on the individual result, but we very deliberately made the test for schools harder.

Chair

When are the new stats going to come out? This year? I thought it was not until 2016-17.

Chris Wormald

No. In terms of the 2014 results, I think they come out—

Chair

They will take out nail technology, horse grooming, blah blah blah.

Chris Wormald

All the playing out of the Wolf reforms and the reduction in what counts on the vocational side, that plays out in the 2014 results, which are not published yet. [Interruption.] I am sorry, Mr Mitchell asked me several questions and I have not answered them all. I do not apologise at all for the focus on exam results. Of course that is not all that makes a good school, but you cannot be a good school unless you get good exam results, so I would agree that good schools also need to be doing the kinds of things that Mr Mitchell was describing. Of course the Ofsted inspection framework looks a lot wider than exam results and goes into those issues.

Austin Mitchell

But you do not know enough about the other factors besides exam success to make your interventions anything more than haphazard. Paragraph 3.5 says that “the Department had identified 38 academies as candidates for formal intervention, based on poor pupil attainment. We reviewed the performance of other academies and found that a further 141 had similarly poor performance but were not identified as candidates for formal intervention”. It goes on: “the Department had not applied its criteria consistently to determine when to issue a notice and when to take a less formal approach”—they do not know enough.

Chris Wormald

As the Chair noted earlier, there was an element of judgment in this and where I agree with the National Audit Office is that we have not been good enough at recording the basis on which those judgments have been made. But the answer is that we do not take a purely arithmetical approach to where we do and do not intervene. Essentially, regardless of whether it is an academy or a maintained school, we take a judgment as to, “Is this school capable of self-improvement?”, in which case informal methods of intervention are probably more appropriate, or, “Has this school lost the ability to self-improve?”, in which case we are talking about structural changes and changing the governing body, whether that be through an IEB or an academy, so we do make that judgment.

Chair

I will tell you what is surprising. One accepts that you make a judgment, but if you look at that paragraph, it is surprising that you intervened in so few. So 15 out of 38 that you knew about were all that you intervened in, and then the NAO found that 141 had similar performance levels, but in which there had been no intervention. We would accept a judgment, but it seems that you are not doing a lot.

Chris Wormald

As I think Mr Phillips said earlier, it is not the case that we do not intervene in those schools. What we do not do is a formal intervention; we intervene in an informal way, in ways that some of your colleagues were describing earlier.

Chair

If I take your figures, they are 38 plus 141, so you intervened in almost 180 schools, but where standards were not good, you only intervened in 15.

Chris Wormald

Formally, yes.

Chair

What do you think of that, Sir Michael?

Sir Michael Wilshaw

It is a judgment issue, and I suppose the key judgment is whether those schools have got the potential to improve through good leadership—

Chair

Fifteen out of 180.

Sir Michael Wilshaw

That is a decision that the Department will have to make on that—

Sir Amyas Morse

This is a charitable comment, but the Department acknowledges that it doesn’t have very good records on this. You are just asserting that you did something with these other schools, but we don’t have any evidence. You might not have done anything at all.

Chris Wormald

Where I agree with the NAO is that we have not been good enough at recording this. One of the things we are doing as part of the move to regional schools commissioners is a complete overhaul of how we take those decisions. There will be a much more formal and recorded process.

Chair

I am going to take two trusts. One is AET, and Sir Michael did an Ofsted on that trust by default. How many schools does AET run, Peter?

Peter Lauener

AET has 78, or something like that.

Chair

Seventy-eight schools. I will go on to deal with a trust in my constituency, but Sir Michael said in his letter that: “AET academies were not improving quickly enough, with too many continuing to be less than good… with eleven academies” —I don’t know how many you looked at—“judged inadequate, the Trust faced a substantial challenge in raising the performance of its academies… around half of all academies inspected by May 2014 were less than good, a picture that had hardly improved since our December 2013 inspections when six of your academies were judged inadequate.” The letter continues: “Of the 12 academies inspected…one was judged to be inadequate; five…‘require improvement’; six were…‘good’; none was…‘outstanding’.” Teaching “was not good enough to enable all groups of pupils to make sufficient progress”. Governance that “did not hold school leaders to account or ensure action was taken” was also a weakness. The letter goes on to say that “leaders did not know how the Trust intends to ensure that every academy is good or better… leaders did not have a clear understanding of the roles and responsibilities of governors and the Trust’s board.” That is a pretty damning Ofsted report. The trust has a large number of schools—I was trying to get you on to this earlier—and it has expanded very rapidly. It seems to me that it has bitten off more than it can chew.

Chris Wormald

We acted on that report, and it is probably fair to say that that particular chain, and indeed some others, were expanding too fast.

Chair

What have you done?

Peter Lauener

To save me from correcting the transcript later, the trust manages 76 academies. Ofsted has had concerns about standards, and in the EFA we have had concerns about financial management. Budget forecasts have been quite volatile.

Chair

Over three years, £500,000 was spent on the private business interests of the trust’s trustees and executives.

Peter Lauener

They developed a proposal to contract out a lot of functions—

Chair

No, that’s another thing—it is PwC. I was going to come to that. The trust has spent £500,000 over three years on the private business interests of its trustees and executives.

Peter Lauener

The point I was making is that we had significant concerns about the financial management, so we issued financial notices to improve. We also paused the AET—

Chair

What are you doing? This is a shocking indictment that brings it into disrepute.

Peter Lauener

No. 1, we have issued a financial notice to improve. No. 2, there has been a pause on the trust taking on any more academies. No. 3, we are discussing whether some of the academies in the chain might be better managed by other sponsors. No. 4, we have worked with the trustees to bring in a new chair to strengthen governance.

Chair

Are you taking any action on the fact that they are contracting out to PwC not just the obvious accountancy things but things such as speech and language therapy, educational psychology, education welfare, curriculum development and professional development? Do you have a view on all that?

Peter Lauener

The proposal to contract out a lot of services to PwC was one that we regarded as interesting but novel and contentious, and therefore one that required our agreement. We were not willing to give that agreement because of our wider concerns, so we put a stop to the proposal.

Chair

That is one that I think has expanded too fast. Let me take you to one in my own constituency, which has taken over a primary school, Dorothy Barley school. It is called REAch2. That school was not doing well. It has not been doing well for a long time, so I supported the intervention, although there was a very good local academy trust, which I think would have provided a service. You rejected that and you put in this organisation, REAch2, which I have been spending all my time trying to find out about. I managed to get the chief executive to come and see me in the House of Commons, and when I asked him what his experience was, he had obviously run a good school in Waltham Forest. And then I said, “Where were you before that?” He was a head teacher in Islington. Well, surprise, surprise—I knew something about that. He could not remember the school that he was a head teacher of. When I then did some further investigation into it, it turned out that they had parted company, to put it in its most polite way. The papers have disappeared, because I have been trying to get them, but basically he was made to leave and there were some allegations around financial mismanagement, as well as quality allegations. I gave your Department this information, because I thought it was pertinent to the decision. You went ahead and gave REAch2 this school and, more than that, in the last two years REAch2 have taken on 35 primary schools that they are looking after now, up and down the country. Given this guy’s past history in Islington, I don’t have confidence in him; I don’t think you should, either. I don’t know why you ignored the information when I gave it to you. I visited Dorothy Barley school recently. He has been there since June and all I can tell you is that the vast majority of staff there are agency staff; there is hardly anybody there who is a full-time permanent staff member. And as you just walk around the school—I am not a teacher or an inspector, but I have a passion about education—it was difficult to find much on the walls, apart from the rules of behaviour.

Chris Wormald

I don’t think either Peter or I know this case in detail, so we will need to go away and look at that.

Chair

It is one of the cases where, again, there is this pattern, which I think is where you bring the whole academy policy—a policy that I think many of us around the room support when it has worked well—into disrepute, because you have allowed a massive expansion with somebody, who—actually, he does run a good school in Waltham Forest; I will give him that. But beyond that, he was basically sacked from his previous job.

Chris Wormald

Right. Well, we will have to look into that and come back to you.

Chair

I did tell you, Chris; I mean, I told the Department. I had a session with the Department.

Chris Wormald

Yes, and what I am saying is, sorry, I don’t have a briefing on that particular case and I don’t think Peter does either.

Peter Lauener

I don’t have any information on REAch2. It is not on our national concerns list. Indeed, it’s generally well-performing—

Chair

Can you just explain to me the general thing, and maybe Sir Michael can, too? It is this thing about expanding too fast. I think you have got it in Academies Education Trust; I suggest to you that if Sir Michael goes and looks at a REAch2 school, you might find it there.

Sir Michael Wilshaw

Before I got this job, as well as heading up Mossbourne, I was director of education for ARK academies. The chief executive there and the board of trustees were very clear that they would expand only when they felt they had the capacity to do so. They took on some very tough schools in London and elsewhere, in Portsmouth and so on. But they looked at each case on its merits and decided that they would take them on only if they felt that they could improve those schools and had the capacity to do so. They have got an interesting model, and I think the good academy chains have got a similar model, where they put a good school, and hopefully an outstanding school, as a hub, to ensure that it is a hub for good practice for the other schools that they take on. So ARK moved into Birmingham, for example, and made sure that it had a school in Birmingham that was an outstanding school, which could help support and challenge other schools in Birmingham that ARK could take on. If ARK did not have that outstanding school, it would not have taken on more institutions in Birmingham. So ARK has a clear strategy, to ensure that it takes on only what it can sustain and improve.

Mr Bacon

That is very interesting, Sir Michael. We had ARK some years ago as witnesses, together with the United Learning Trust, and they were two of the most impressive witnesses we have ever had. But it may not be the case that all academy chains take quite that view, or are quite as well managed. We know it has happened many times in industry with different sectors. It has happened in the banking sector. It doesn’t actually matter which sector it is. If you take on far too many widget manufacturers and acquire them at too high a rate or, as we saw with Royal Bank of Scotland, if you take on far too many banks and buy new ones at too high a rate and can’t absorb them, there will be adverse consequences. The same is true in schools. Do you think that has been one of the problems—that some academy chains have been expanding too fast?

Sir Michael Wilshaw

Absolutely, and I think the Department would acknowledge that some chains grew exponentially without the capacity to make the necessary improvements.

Mr Bacon

Surely then, Mr Wormald, there sits on the Department the responsibility to say, knowing all the above can happen because it is an obvious risk, “No, you can’t expand because you are not ready.”

Chris Wormald

And that is exactly what we will be doing.

Mr Bacon

You mean after the event. How do they get to this point is my question. If you were doing your job in a timely way, how did they get to this point?

Chris Wormald

I will come on to that.

Mr Bacon

That was my question.

Chris Wormald

At this moment, there are 18 paused chains where we have taken the kind of action Peter was describing. We are not disputing at all—

Mr Bacon

Mr Wormald, I want to be clear. Mr Lauener mentioned 76 academies in the case of AET.

Peter Lauener

There are 76 academies within AET. The sponsors are 18 paused trusts.

Mr Bacon

I understand. I just wanted to be clear. My next question is: in relation to the other 17, making a total of 18—AET has 76 academies—how many are there in these 18 paused trust chains?

Peter Lauener

I don’t have that figure.

Mr Bacon

You don’t know?

Chris Wormald

The Department will know.

Mr Bacon

What I want to know is that if AET has 76 academies, then which is the next one you have paused and how many are there in that, and so on and so forth? If you add them all up, how many academies do you get to?

Peter Lauener

To give you an example of another—

Mr Bacon

I don’t want an example. I want an answer to my question. How many academies sit within paused chains?

Peter Lauener

I can’t give you that figure now, but we can supply it afterwards.

Mr Bacon

Hang on. Slow down. Why don’t you know that figure? It is pretty elementary I would have thought. These are academies whose senior management—the body to which they belong—has been told they are not doing a good enough job, so they must pause. That is affecting a lot of academies by the sound of it. I would like to know and I think most members of the public, taxpayers and parents would like to know how many there are and how many pupils are affected.

Peter Lauener

We will write to you with the details.

Mr Bacon

I don’t want a letter. I would like the answer today please. This is pretty basic information and you must know how many there are.

Peter Lauener

I’ll give you an example of one of the significant large chains that we paused, which again is one that will be familiar to this Committee because we have discussed the chain performance. E-ACT is supposed to have been paused. We have also rebrokered eight of the E-ACT academies to other sponsors, so they have not just been paused. We have reduced the number of academies that E-ACT is responsible for because we thought that it needed to concentrate on core business in the right area, rather as Sir Michael was talking about, putting in place a sensible strategy in the way that some of the successful multi-academy trusts do.

Chair

Why did you wait for things to go wrong? Chris squirmed when I said it, but AET and where it is now is a terrible indictment, and there are 76 schools with God knows how many thousands of pupils involved who are being badly served by us. I think this is where Richard is taking you. Why didn’t you know earlier so that you could stop them taking over further schools? Why didn’t you have a slower system of expansion? With my REAch2, if they had had a school in the area, I would have been happier. Their nearest school was in Waltham Forest. It takes them an hour and a half to get from Waltham Forest to Dorothy Barley. It is nonsense to think you can use that to improve quality in a failing school.

Peter Lauener

It is clearly the case that we allowed some of the academy chains to expand too fast—

Chair

Why?

Mr Bacon

That goes back to my first question. I described earlier the scenario of expanding too fast and the obvious problems that can cause. Given that that is very obvious, why then did you not see, very early on, that these were expanding too fast, and stop it, very early on, rather than get to the point where you have this quite considerable number that you have had to pause?

Peter Lauener

That is 18 out of 645 approved sponsors, to put it in proportion.

Chair

But they all have a lot of schools.