The Sleazy State: How the Web of Patronage Works / Day 2: Tory backers linked to schools agency: Education opt-outs

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A NETWORK of government supporters is linked to a new education quango for opted-out schools that starts work on 1 April.

An insurance scheme being arranged for opted-out schools uses only one company - Sun Alliance, which has given pounds 280,000 to Conservative Party funds over the last six years.

Sir Christopher Benson, chairman of Sun Alliance, is chairman of the quango, the Funding Agency for Schools, and receives a salary of pounds 33,430 for two days a week.

The new insurance scheme is called Grant Maintained Schools Mutual, and Sun Alliance International is to underwrite insurance for its members. Sir Robert Balchin, the Conservative Party chairman for South-east England, is chairman of the mutual scheme.

Sir Robert is also chairman of the Grant Maintained Schools Centre which provides information for schools that opt out. He will continue as chairman of both the centre and the foundation.

The new arrangements for services to opted-out schools are being made after an investigation by the Charity Commissioners.

Both Labour and the Liberal Democrats have accused the Government of using taxpayers' money to reward its supporters.

Don Foster, the Liberal Democrats' education spokesman, said: 'Sun Alliance's contributions to the Tory party have clearly had their desired effect. Its chairman has been given a lucrative part-time post on a new quango and the company is set to make more money. This is further evidence of the Government greasing the palms of its friends with taxpayers' money.'

Parents Opposed to Opting Out, a pressure group, said that many opted-out schools had been unable to arrange insurance because of the state of their buildings, and some have had to insure themselves at very high rates.

Sir Robert said: 'The Grant Maintained Schools Mutual Scheme was set up to provide market stability and service for these schools. It is a mutual scheme that is non-profit-making. The scheme arranges cover underwritten by Sun Alliance and London plc.'

A spokesman for the Department for Education said: 'Any suggestion that Sir Christopher Benson intends to hawk insurance policies is laughable. We expect grant-maintained schools to obtain three quotes and to take the lowest.'

He said the Funding Agency for Schools would make arrangements to ensure that there was no conflict of interest.

The agency, which will pay and monitor grants to opted-out schools and decide how places are distributed, will be one of the most powerful bodies in education. The Government hopes it will eventually supervise most schools, replacing local authorities, as the number of opted-out schools increases.

The 12 members of the agency appointed so far (there are two vacancies) include no one from a local authority except Edward Lister, the Conservative leader of Wandsworth Council. There are four representatives of opted-out schools and one from an independent school. There is no local-authority school head, although the agency will at first supervise both grant-maintained and local-authority schools.

Another member is Stanley Kalms, chairman of the Dixons Group, who made a major contribution to the Government's city technology college in Bradford, West Yorkshire.

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