Financial mismanagement allegations against academy trust director after £1.2m deficit uncovered
PUBLISHED: 06:00 06 June 2019 | UPDATED: 09:57 06 June 2019
Leaders at a Norfolk academy trust looking after some of the county's most vulnerable children have reassured families they are turning around historic cash problems, after an investigation uncovered a financial black hole of more than £1m.
The investigation into the Engage Trust took place after it was served a financial notice to improve by the Education and Skills Funding Agency (ESFA) in September 2017, indicating a lack of confidence in its financial wellbeing and management.
It uncovered a deficit of around £1.2m - which, according to the trust's most recently filed accounts, was "much greater than had previously been reported" by the chief executive and chief financial officer.
Details of the investigation have only now been revealed during an employment tribunal brought against the Engage Trust by its former business director Gillian Wardlow.
In response, Engage Trust board chairman Dennis Freeman said prompt action had been taken to address the financial issues and he expressed confidence the trust was "on the right trajectory" to attain a surer financial footing.
The Drayton-based Engage Trust has more than 350 pupils and runs academies including the Douglas Bader School in Badersfield, Brooklands School in Gorleston and Locksley School in Norwich, collectively known as the Short Stay School for Norfolk, as well as the Pinetree School in Thetford.
It caters for students who have been excluded from mainstream schools and those with complex learning needs such as mental health problems.
The independent investigation into its finances in late 2017 found that the trust's board "appeared completely unaware" of the significant deficit.
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According to the employment tribunal report, an investigation was subsequently launched into both Mrs Wardlow and the trust's then-chief executive Des Reynolds.
The report said Mrs Wardlow was suspended in March 2018 in order for "allegations of serious financial mismanagement" to be investigated.
The subsequent investigation report recommended the trust take disciplinary action against Mrs Wardlow on grounds of potential gross misconduct - a recommendation which the tribunal report suggests was followed.
Mrs Wardlow resigned on April 30 2018, but the employment judge did not find that she was constructively dismissed, as she had claimed.
Mr Reynolds was suspended around the same time as Mrs Wardlow and finally sacked in December 2018 following a full disciplinary procedure.
It is understood his dismissal was on grounds of gross misconduct.
Since the independent financial investigation the ESFA has served two further financial notices to improve on the trust, one in March 2018 and the second in September 2018.
A letter accompanying the latter notice said that while changes had been made to strengthen internal financial controls, concerns about "weak financial position and financial management" remained.
In a statement Dennis Freeman, Engage Trust board chairman, said: "As soon as the leadership board of the Engage Trust became aware that there were significant financial challenges, a number of internal and external reviews were immediately undertaken to ensure that the trust responded promptly and took appropriate action, as were detailed in the court's findings.
"It wouldn't be appropriate to comment any further on individual staffing issues. However, the financial issues have been systematically addressed with a robust recovery plan that is well established and that has external and internal monitoring in place. We continue to demonstrate an improving picture and we are confident that we are on the right trajectory that will result in the financial notice to improve being lifted as soon as possible.
"A new leadership team has been in place since the beginning of the academic year and our unrelenting focus remains on providing the best education for our children and young people."