George Osborne announced in the budget that all remaining local authority schools in England must become academies by 2022. The Education and Adoption Act 2016 will compel councils and school governors to co-operate in the forced academisation of eligible schools; remove any requirement for consultation with parents, governors or local authorities; and allow the education secretary to control the make-up of the ‘interim executive boards’ that oversee a school’s conversion into an academy. An amendment tabled by Labour peers, requiring that parents and others be consulted on academy conversions, was defeated by Conservative MPs.

There are still a few loopholes to be closed, however. One is the recommendation, set out in the academy articles of association published by the DfE in 2013, that all multi-academy trusts (MATs) should have two elected parent trustees or representatives, either on the board of the MAT or on each school’s governing body. The white paper Educational Excellence Everywhere makes clear that this prescription is to be dropped. School governance will be streamlined and professionalised, with scope for payment to ‘attract the very best people’: ‘as we move towards a system where every school is an academy, fully skills-based governance will become the norm’.

The minister responsible for school governance is Lord Nash, the parliamentary under secretary of state for schools. He and his wife Caroline, a former stockbroker, in 2006 set up Future Academies, which runs a small chain of schools in Westminster. The trust’s board has seven members, including Lord and Lady Nash. There are no parent trustees. The couple are also co-chairs of the board of governors of Pimlico Academy, the chain’s flagship school. Of the five other governors, three are also on the Future Academies board; there is only one parent governor. In 2013, Nash told the Independent Academies Association:

Personally, I’m not keen on big governing bodies. Lord Adonis asked me if he could cite Pimlico in his book because with seven governors we apparently had the smallest governing body in the country. This surprised me greatly as coming from the business world it would by no means be regarded as a small board of directors.

Nash says that governance has to move beyond the representation of ‘particular interest groups’ – parents and teachers – in order to draw on the ‘widest possible pool of talent’. ‘Running a school is in many ways like running a business, so we need more business people coming forward to become governors.’

The Academies Enterprise Trust controls 67 schools. Its chairman of trustees is Jude Chin, who worked at KPMG for thirty years and has experience ‘advising on mergers, acquisitions and stock exchange listings’. The chair of trustees of REAch2, which runs fifty schools, is a property developer, Peter Little. The board of the Kemnal Academies Trust (41 schools) is led by John Atkins, a former college principal; but the vice-chair, Aruna Mehta, was once a managing director at JP Morgan Chase, and another trustee, Ian Armitage, is ‘an experienced venture capitalist and private equity investor’. Ark, which runs 34 academies, has nine trustees; six of them are hedge fund managers, and none has any background in education (one of them, Lord Fink, was treasurer of the Conservative Party). The Inspiration Trust runs 14 schools in Norfolk and Suffolk. Its board is led by Sir Theodore Agnew, another financier – his background is in ‘business process outsourcing’ and private equity – who was once head of the DfE’s Academies Board.

Lord Nash is a former chairman of the British Venture Capital Association, and a co-founder of Sovereign Capital, a private equity firm with interests in education and healthcare. He was chairman of the private health and social care provider Care UK until 2010, when he joined the ‘red team’ of bankers and financiers helping Osborne to ‘think innovatively about the options for reducing public expenditure’, before moving on to the DfE’s board of non-executive directors (Agnew joined the board at the same time). Ennobled in 2013, Nash stepped down as chairman of Sovereign Capital and became a minister. He and his wife are substantial donors to the Conservatives, having given the party almost £300,000 between 2006 and 2013.

In 2002, Sovereign Capital acquired the Alpha Plus Group, ‘one of the UK’s most prestigious private education providers’. Over five years – the typical investment period of a private equity firm – they ‘increased pupil numbers by 44 per cent … and expanded pupil capacity by 1100 places’. Alpha Plus was sold to Delancey Real Estate Asset Management, in a deal reportedly worth around £120 million. In 2008, Sovereign bought the World Class Learning Group, which runs international schools. In 2013, after ‘strong organic and acquisitive growth’, the WCL Group was sold to Nord Anglia Education (‘the exit returns a multiple of 5.3x money invested’).

Sovereign is currently investing in Paragon, a work-based training provider which will receive more than £17 million from the government’s Skills Funding Agency this year, and the Astrum Education Group, which runs a number of private sixth form colleges and has ‘many opportunities for growth’. As Michael Needley, the leader of Sovereign’s education team, apparently told an audience of investors last year, education is a ‘tremendous sector’ for high-return investment firms. ‘Let's all go forth,’ he said. ‘Let’s all make hay.’

Read more in the London Review of Books

Jenny Turner: School Privatisation · 7 May 2015

Dawn Foster: Free Schools · 7 May 2015

Thomas Jones: In the Classroom · 28 November 2002