Question to the Department for Education:

To ask His Majesty's Government what steps they plan to take to identify and act on trusts holding excessive quantities of reserves that are depriving pupils of resources for which public funds have been provided, following the Academy trust reserves guidance, published by the Department for Education on 2 June.

Academy trusts hold reserves, as part of good financial management, for a range of reasons. This will include:

• Ensuring sufficient cashflow and contingency funds.
• Maintenance and improvements to existing buildings, and construction of new buildings.
• Investment in IT and systems, and pupil and staff provision.
• The trust’s wider financial management strategy.

Academy trusts must be accountable and transparent on how they manage their reserves. The Academy Trust Handbook requires trusts to have a reserves policy in place, explain their policy in their published annual report and include a clear plan for managing the reserves they hold.

The department engages with academy trusts on their reserves to ensure they have plans in place to use their funds to deliver outcomes that benefit pupils, effectively mitigate against unforeseen issues, and invest in their current and future pupils’ education.