Education Reform Act 1988

37 Withdrawal of delegation

(1) Where it appears to a local education authority, in the case of any school in respect of which financial delegation is required for the current financial year under a scheme, that the governing body of the school—

(a) have been guilty of a substantial or persistent failure to comply with any requirements applicable under the scheme; or

(b) are not managing the appropriation or expenditure of the sum put at their disposal for the purposes of the school in a satisfactory manner;

the authority may suspend the governing body’s right to a delegated budget by giving the governing body (subject to subsection (3) below) not less than one month’s notice of suspension.

(2) Any such notice shall specify the grounds for the proposed suspension, giving particulars of any failure alleged on the part of the governing body to comply with any requirements applicable under the scheme and of any alleged mismanagement on their part; and a copy of the notice shall be given to the head teacher of the school at the same time as the notice is given to the governing body.

(3) A local education authority may suspend the right to a delegated budget of any governing body to whom they have given notice under subsection (1) above before the expiry of the period of notice if it appears to them to be necessary to do so by reason of gross incompetence or mismanagement on the part of that governing body or other emergency; but in such a case the authority shall immediately give to the Secretary of State written notification of their action and the reasons for it.

(4) During any period when a governing body’s right to a delegated budget is suspended under this section the duty of the local education authority concerned under section 36(2) of this Act shall not apply in relation to that governing body.

(5) It shall be the duty of the authority concerned—

(a) to review before the beginning of every financial year any suspension under this section which is for the time being in force;

(b) for the purposes of that review, to afford the governing body concerned and the head teacher of the school an opportunity of making representations with respect to the suspension and to have regard to any representations made by that body or the head teacher; and

(c) to revoke any such suspension where they consider it appropriate to do so.

(6) The authority shall give the governing body concerned and the head teacher written notification of their decision on any such review.

(7) The revocation of any such suspension shall take effect as from the beginning of the next following financial year.

(8) A governing body shall be entitled to appeal to the Secretary of State against—

(a) the imposition of any suspension under this section; and

(b) any refusal of a local education authority to revoke any such suspension on any review required under this section.

(9) On any such appeal the Secretary of State—

(a) may allow or reject the appeal; and

(b) shall have regard, in making his determination, to the gravity of the default on the part of the governing body and the likelihood of its continuance or recurrence.