The Department for Education has issued a Notice to Improve to Mercian Educational Trust. The letter, dated 10 November 2025 and published on 12 December 2025, cites breaches of the Academy Trust Handbook and systemic weaknesses in financial management and governance.
DfE lists breaches of ATH paragraphs 1.36, 1.39, 2.1, 2.2, 2.6, 2.7, 2.18, 2.19, 2.29, 3.1, 3.3, 3.20, 4.4, 4.9 and 6.6. These cover accounting officer assurance, CFO appointment, internal control and scrutiny, timely financial reporting, and publication of senior pay bandings.
Being issued with a Notice revokes key delegated authorities under the Handbook. The trust must obtain prior DfE approval for severance and compensation payments, debt write‑offs, guarantees and indemnities, specified asset disposals and leases, and for carrying forward or pooling GAG; retrospective approval is not permitted.
Condition 1 requires on‑time, unqualified submissions: audited financial statements, the management letter and the internal scrutiny report by 31 December 2025; the Academy Accounts Return by the annual deadline; and the 2023/24 School Resource Management Self‑Assessment Checklist by end November 2025, with 2024/25 by its deadline. Conditions 2 and 3 require prior approvals via the Customer Help Portal and ATH‑compliant monthly management accounts for November 2025 to January 2026.
Condition 4 focuses on internal scrutiny: interim reports and relevant committee minutes must be provided; the 2024/25 internal scrutiny report is due by 31 December 2025; and evidence of a 2025/26 scrutiny programme must be submitted by 5 December 2025. Condition 5 mandates a School Resource Management Adviser deployment on financial governance and control, with the report and an action plan commissioned by December 2025.
Condition 6 requires submission of the External Review of Governance report commissioned in July 2025 by end November 2025. Condition 7 then requires evidence that recommendations from that review and the SRMA have been implemented or justified, with progress tracked in regular engagement meetings until completion.
DfE will monitor progress through case reviews and lift the Notice only once all conditions are met and the trust is fully compliant with the Handbook. Failure may be treated as a funding agreement breach leading to termination; persistent non‑compliance may be referred to the Charity Commission or Insolvency Service. Policy Wire analysis: withdrawal of delegated freedoms will lengthen decision lead times for settlements, write‑offs or leases and should be factored into board timetables.
Routine duties are restated: monthly management accounts must be shared with the chair and considered by the board; senior pay bandings over £100,000 must be published; audited accounts are due to DfE by 31 December and must be on the trust website by 31 January; and information for the sector’s annual report and accounts must be prepared. The trust must acknowledge receipt within three working days, may provide factual accuracy comments within ten working days, and must publish the Notice on its website within 14 days of the gov.uk publication. The letter is signed by West Midlands Regional Director Sue Lovelock and Director Lindsey Henning.