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£1bn spent on additional costs for academies programme

The Department for Education was “unprepared” for the scale of the financial implications of increasing the number of academies so quickly, a new report by the National Audit Office suggests.

The report praises the department for delivering “fundamental” change, with 2,309 academies open since 2010, representing growth of 1,037%. This is described as a “significant achievement”, and since many of these new academies have been either ‘outstanding’ or ‘good’ schools converting, the risks have been fairly low.

However, as lower Ofsted-rated schools start to apply, there may be a need for more in-depth assessment and support to manage the potential risks.

Additionally, the DfE has spent £8.3bn on the programme in total, with an estimated £1bn of this on ‘additional costs’. These costs are increasing annually, but the average additional cost per academy has been reduced by 53% in the last two years.

The report warns that the department has had to transfer funding from other budgets to stay within its overall spending limits while maintaining the pace of the expansion.

Amyas Morse, head of the National Audit Office, said: “The Academies Programme is a key element of the Government’s plans to reform the school system. Delivering a ten-fold increase in the number of academies since May 2010 is therefore a significant achievement.

“However, the Department for Education was not sufficiently prepared for the financial implications of such a rapid expansion, or for the challenge of overseeing and monitoring such a large number of new academies.

“It is too early to conclude on academies’ overall performance, and this is something I intend to return to in the future. As the Programme continues to expand, the Department must build on its efforts to reduce costs and tackle accountability concerns if it is to reduce the risks to value for money.”

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