The Charity Commission has opened a statutory inquiry, frozen the bank account and appointed interim managers to a charity which runs an independent primary school based in East London over concerns about its finances.
Grangewood Educational Association runs Grangewood Independent Primary School – a Christian school that was founded in 1979 - but has been experiencing financial difficulties for a number of years. Earlier this year announce that it planned to close, prompting parents and teachers to launch a campaign.
It entered a company voluntary arrangement in 2014 and sold its premises in 2015. Its most recent accounts, for the year ending 31 August 2016, show an income of £381,000 and spending of £625,000. School fees represented 90 per cent of the charity’s income.
The school’s premises was sold and leased back on 20 December 2015 for £2.3m, with the charity entering into a lease agreement up to 20 December 2019 at £115,000 per year.
The accounts for 2016 show that one of the trustees, Mr L Boney, was paid £87,600 for arranging the sale of its freehold property.
In breach of governing document
At the time the inquiry was opened, the school was operating in breach of its governing document, which requires there to be three trustees, because one had resigned and one had died, leaving it with just one trustee.
The inquiry will consider the charity’s governance, management and administration, looking at whether the trustees complied with the Charities Act when disposing of its property in 2015.
It will also look at whether connected party transactions have been properly authorised.
The Commission has appointed Geoff Carton-Kelly and Jason Daniel Baker of FRP Advisory as joint interim managers of the charity.
School at risk of closure
The Commission said today that the school remains open.
But according to media reports, the school had sent parents letters announcing its closure, prompting parents and teachers to launch a campaign to keep it open.
A group, Save Grangewood Independent School, has set up a GoFundMe page, which has so far raised £1,610 towards a £300,000 goal.
Over 350 people have also signed an online petition on Change.org.
A message to supporters said: “On the 26th March 2018 the parents, teachers and staff were informed that the school would be closing permanently on 28 March 2018, giving just 48 hrs notice. This callous decision was based on falsified accounts that claim the school is nearing insolvency. This is simply not true.”
It added: “Parents have occupied the school building and are determined to FIGHT to safeguard their children’s education and welfare.”