The Priory Federation of Academies Trust released the results of a controversial financial investigation into the schools’ finances.
In a letter on the federation’s website, Chairman Terry Coffey explained that parents had a right to know about the investigation.
The federation, which covers Priory Academy LSST, Priory Witham Academy, Priory City of Lincoln Academy and Priory Ruskin Academy, came under fire after CEO Richard Gilliland resigned as a result on an investigation by the Education Funding Agency.
The agency discovered that Gilliland had used resources of the publicly funded federation to buy personal and “inappropriate” items, including training for his son, personal tax advice and DVDs.
These items were bought on a federation credit card and then delivered to the academy address, the report found.
Invoices for training his son appeared to be altered in an attempt to obscure the identification.
The Department for Education said the matter is currently being dealt with by the police.
Mr Gilliland also admitted for the report that some of the personal items purchased using the Federation credit card and delivered to the federation offices were of an inappropriate nature to be delivered to a school site (e.g. sex games and supplements). He stated that these would only be opened by him as staff did not open mail addressed to him.
As Priory Federation of Academies chief executive, Richard Gilliland was reportedly earning more than £200,000 per year, one of the county’s highest paid public servants.
The top floors of Laughton Manor House were decorated to the standard of Gilliland and his wife at a cost of more than £45,000, with the intention to move in (they have not). This was done over the needs of the federation, the report concluded.
However, the EFA’s main reason it became concerned was the “poor financial management and misunderstandings on responsibilities as to whether expenditure incurred was legitimate”.
This means it appeared the federation’s credit card policies were “too liberal”, Trustee expenses confusion, and inadequate procurement policies.
This led to the agency’s suspicions of fraud taking place.
The findings of the investigation were said to have “shocked” other members of the federation, who are working with the agency to improve.
Errors of judgement
Terry Coffey, Chairman of The Priory Federation of Academies Trust, explained in a letter to parents: “We have accepted all the recommendations made by the EFA.
“Once any shortcomings were brought to our attention, we made the recommended changes at the earliest opportunity.
“We will also welcome future visits from the EFA to confirm that best practice is being carried out,” he added.
The Chairman also explained: “The Trust recognises that mistakes and errors of judgement have been made in the past by two senior individuals who, before they left our employment, failed to comply fully with our internal systems.
“As the report makes clear, a sum of money has already been repaid to the Trust. We are currently reviewing whether any additional legal steps are required.
“The federation would like to make it clear that members of staff whose recruitment is cited by the EFA have long since left our employment.”
— Later update: A Department for Education spokesman said: “The Department’s investigation into the Priory Federation revealed serious failings of key individuals in relation to financial management. The Trust has accepted responsibility and the CEO has now left.
“Unfortunately no system of financial audit can guarantee it will prevent all wrongdoing. When concerns were raised, the Department carried out a full investigation. When its findings were provided to the Priory, its chief executive left the organisation the same day. The Priory Federation is also taking further action as set out in their response.
“The financial accountability systems in place for Academies are more rigorous than those for maintained schools. Unlike maintained schools, Academies must have their accounts externally audited. But lessons can always be learned and we will consider whether we need to strengthen our systems at Federation level.”
The full Department for Education report:
The Priory Federation of Academies Trust response to the report: