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Updated Academy Trust Handbook brings changes for trust governance


A new edition of the Academy Trust Handbook (formerly the Academies Financial Handbook) has been published today (16 June) by the Education and Skills Funding Agency (ESFA). Several of the updates impact trust governance.

Among the most significant changes is the broadening of financial notice to improve (FNTI) to become a notice to improve (NTI), reflecting how the intervention powers of the ESFA may be exercised in relation to more broad governance reasons and not just those of a financial nature.

Changing the name of the Handbook reflects the expanded nature of its content, which now features trusts’ existing responsibilities in a wider range of areas and aims to provide “close to a ‘one stop shop’” for trustees, local governors, executive leaders and others.

The update confirms that trusts should have reserved places for parents/carers in their governance structure – either two positions on the trust board, or two per local academy committee. Baroness Berridge, Parliamentary Under Secretary of State for the School System, takes the opportunity in the Handbook’s introduction to write that “involving parents in trust governance helps ensure that boards stay accessible and connected to the community they serve and supports robust decision making”.

The Handbook also emphasises the Department’s “strong preference” for trusts boards to have an external review of governance both routinely and at times of significant change, with the introduction describing this as a “stronger means of identifying potential improvements, rather than self-assessment alone”.

The changes, unless otherwise stated, are effective 1 September 2021. Academy trusts must comply with this handbook as a condition of their funding agreement.

Sam Henson, director of policy and information at the National Governance Association, who contributed to the update through the working group, said:

“Over the last few years, the Academies Financial Handbook has grown in depth and importance, strengthening its instructions and majoring more and more on the necessity of strong governance in trusts. NGA is pleased this latest version continues to raise the prominence of good governance, promoting external reviews of governance as a powerful tool for improvement. The new iteration, under the new name of the Academy Trust Handbook, continues a pattern of introducing more rigorous controls and checks, emphasising key issues the sector and trusts cannot afford to be complacent on. That said, the subtle name change and the inclusion of a set of summaries of trust responsibilities including safeguarding, health and safety and estates management present a shift in the focus of the handbook. When these changes are considered alongside the altering of financial notices to improve to a broader ‘notice to improve’, it is logical to assume the ESFA will potentially have a broader intervention role for trusts. NGA is seeking further clarification on these changes.”