Concern over role of governors

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The Independent Online
Labour embarrassment over grant-maintained schools was compounded yesterday by the publication of an all-party Commons report on their finances.

On the same day that Tony Blair announced a policy U-turn by declaring his intention to preserve their future, the influential Public Accounts Committee issued a report pointing out weaknesses in their structure and ways they could be improved.

The committee, which includes five Labour members, said it was vital that the Funding Agency, which oversees their finances, revises regulations for schools "without undue delay so as to strengthen the framework for securing propriety and value for money..."

MPs said that they were especially concerned about the key role played by the boards of governors in grant-maintained schools. An earlier report by the National Audit Office, the public finance watchdog, showing that at a sample of 70 schools, 22 did not keep a register of governors' outside financial interests, was a cause for worry.

"We recommend that the [Funding Agency] make maintenance of a register mandatory as an essential safeguard."

Another worry was that governors differ greatly in their ability. Unlike ordinary state schools, they play a much greater role in managing finances. "We are disturbed that the effectiveness of governors' finance committees is variable and not that the [Funding Agency] are considering further guidance to governing bodies on these matters."

At the end of the last financial year, grant-maintained schools carried forward surplus balances of pounds 74m, of which pounds 45.5m was public money. While it was good for the schools to hold some contingency and to plan for building projects, MPs said: "we question the need for large balances to be retained."

Sixty-two schools were allowed to carry forward balances in excess of normal limits. The reasons for this have not been made public - something deplored by the committee, which produced a unanimous report. "We stress that the balances represent money that could be spent on teaching children."

The MPs said that, in general, they were satisfied with the progress the Funding Agency was making.