Academisation option reopened for sixth-form colleges

The Department for Education (“DfE”) has officially reopened the option for sixth-form colleges (“SFCs”) to convert to academy status. To date, 23 SFCs have taken the opportunity to convert to become 16 to 19 academies as part of the area review process. The window to do so closed in March 2019 but, in response to demand, academisation is once again on the table. This development follows rigorous campaigning by the Sixth Form Colleges Association, and is regarded as a welcome development in the sector.

Moving into the academy sector

The Further and Higher Education Act 1992, as amended in 2011, gives SFCs the power to become 16 to 19 academies by dissolving and transferring their property, rights, and liabilities to a new or existing academy trust. Some feel that conversion to academy status offers opportunities for SFCs to build more effective relationships with schools in the local area, with the potential to increase investment in schools by SFCs in the same legal family, and increase progression.

The Government’s updated guidance, issued on 24 July 2019, offers some much-needed clarity for SFCs looking to convert. Notably, SFCs would receive a conversion support grant of £25,000 following approval by the relevant Regional Schools Commissioner. In addition, the guidance has removed the option for SFCs to form a Single Academy Trust and operate as a stand-alone academy, stating that SFCs must either form a new Multi Academy Trust (“MAT”) with other schools or colleges, or join an existing MAT.

Potential advantages of academisation

Academisation won’t be right for everyone, and whilst important decisions should rarely be taken on a purely financial basis, some of the main advantages of conversion are financial – most notably through the significant savings made as a result of the ability to reclaim non-business VAT on the goods and services academised SFCs buy. Additionally, forming a MAT with other academies, or joining an established MAT, could lend a greater degree of financial resilience to all academies within the MAT (including the SFC). For instance, the Academies Financial Handbook allows MATs to pool General Annual Grant funding to meet the running costs of any constituent academies within the trust, allowing greater flexibility over finance and purchasing.

Conversion also offers a range of non-financial benefits for SFCs, including:

• Access to funding that is not easily accessible outside of the academies sector, such as DfE assistance with insurance premiums;
• Greater certainty as to the process for extending a SFC’s age range to include younger students; and
• Access to better collaboration and support from other academies within the MAT.

A key benefit is that a MAT can offer a convenient vehicle for SFCs to drive forward place-based solutions and offer system leadership. This can of course occur outside of an academised structure, but being able to bring together schools and SFCs under one legal and financial umbrella (providing a single voice in a locality to work with other community partners, such as the relevant Local Authority) has the potential to increase even further the ability of SFCs to lead the way in helping young people to improve their life opportunities.

Potential drawbacks of academisation

Any SFC considering academisation needs to ensure that it is the right option for them. Not only will conversion involve a complete overhaul in governance, but a permanent change of legal status will also be required to allow the SFC to operate as a 16 to 19 academy.

Conversion also raises a range of new challenges for SFCs, including:

• Any expansion of an SFC’s age range to allow admission of younger students could bring the entire institution within the scope of the Admissions Code;
• Academies are public sector institutions whereas SFCs are not; the consequences of which include changes to regulation post-conversion, particularly with respect to spending, employment of staff and financial reporting;
• Under current immigration rules, academies are not permitted to hold a Tier 4 licence and so the SFC will be unable to enrol new non-EEA students requiring Tier 4 sponsorship; and
• New contractual arrangements will need to be put in place to maintain any existing franchising arrangements in place between the SFC and a higher education institution, and there would be a loss of direct access to funding.

Future Developments

Catholic SFCs have identified barriers within the current system, noting that the funding agreements for 16 to 19 academies may not be sufficiently customised to maintain their current religious character. This is likely to prevent Catholic SFCs converting to academy status for the foreseeable future, which places them at a disadvantage if they want to exploit the potential benefits of academisation. The DfE has however reported its commitment to exploring options in the future.

We have developed a toolkit for SFCs considering a range of structural options, including academisation. If you would like to know more, please contact Ciara Campfield, Tom Morrison or any other member of our national Education Team.