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Academies Financial Update: Growth funding now available through the new Trust Capacity Fund

This week, the Department for Education published guidance on the new Trust Capacity Fund to encourage the growth and development of trusts through financial grant support.

The new fund will offer a range of financial grants covering a number of areas ranging from £50,000 to £310,000 with up to £17 million being made available over the 2020-21 financial year.

The fund is not only to encourage existing academy trusts to merge, grow and support other schools but to encourage rural schools to collaborate, convert and create new MATs.

What are the areas covered?

The funding has been split across four areas, each with its own maximum grant allowance.

  • A1: Support strong trusts to grow and innovate in areas of long-standing need
  • A2: Encourage strong trusts to grow by taking on and improving weaker maintained schools and academies
  • B: Accelerate the development of mid-sized trusts with the potential to be strong
  • C: Support the merger of smaller trusts to form new strong trusts, as well as priority projects from Regional School Commissioners (RSCs) which do not fall under the other strands
  • D: Support good or outstanding LA maintained rural schools to collaborate and create new, strong MATs.

Each area has its own specific criteria such as number of schools within the trust, no financial notices to improve and must be good or outstanding Rural LA maintained schools.

What are the Must Haves?

For areas A to C:

  • take at least one additional school into your trust
  • demonstrate how you plan to use the funding efficiently and effectively
  • be of sound financial health and, as a minimum requirement, not have an open FNtI
  • in certain cases, you may be required to consent to a visit by a School Resource Management Advisor (SRMA).

For area D:

  • apply to convert to academy status
  • provide a clearly defined plan for growing your MAT, committing to take on at least 2 additional schools, who will submit a conversion application by 31st March 2021
  • demonstrate how you plan to use the funding efficiently and effectively
  • agree to an SRMA visit to help establish the correct governance and finance at the outset of forming the new MAT.

The guidance is clear on what activities do not qualify for the grant and what they consider growth items on top of the above criteria.

The Key Dates?

The closing date for the fund is 31st December 2020, however submitting an application as soon as possible is encouraged.

All funded activities must not have started any earlier than 6th April 2020 but must be completed by 31st March 2021.

Our Experts’ Comments

This grant fund is clear evidence of a direction of travel that the DFE wants the academy sector to go down. With the consolidation of small trusts, growing mid-size successful MATs and an interesting focus on converting rural maintained schools into academies. We expect a lot of smaller MATs and SATs will be keen to obtain this funding and may have already received some kind words of encouragement to grow, merge, support and convert other schools into their trust by their RSC.

Given the finite amount of funding available and the strong recommendations within the guidance for early applications, we anticipate that the funding may not be around for long, so ensure your applications are made as soon as possible.

Full guidance, including how to access short term support with costs can be read here.

Please do contact us if you have any additional questions or require clarification: