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England’s largest academy trusts raised nearly £24 million from investing surplus cash last year, ����Vlog analysis reveals.

It has become increasingly common for trusts to deposit money that is not immediately needed into multiple savings accounts to earn higher interest rates, rather than leaving the funds idle.

But there are concerns that not all trusts are equally placed to benefit from this practice, leaving those lacking surplus funds or investment expertise lagging behind.

Together, the biggest 20 trusts by number of schools generated £23.9 million in investment income in 2024-25, a slight fall of £659,000 compared with 2023-24, �ձ��’ figures show.

Eight of the largest trusts generated between £1.09 million and £4.16 million each through cash deposit interest returns in 2024-25.

On average, across the 20 trusts, investment income equated to £22,154 per school within each trust, if split evenly.

However, nine of the trusts generated lower investment returns in 2024-25 than in 2023-24.

The was near a historic high at 5.25 per cent in August 2023, but then decreased to 5 per cent in August 2024 and has been gradually falling since.

England’s biggest trust, , recorded a 25 per cent drop in investment income, from £5.54 million in 2023-24 to £4.16 million in 2024-25.

United Learning, which comprises 36 primary schools, 56 secondaries and four all-through schools, was approached for comment.

Similarly, Oasis Community Learning, the third-largest trust in England with 33 primaries, 20 secondaries and two all-through schools, saw its investment income fall by 16 per cent, from £3.28 million in 2023-24 to £2.74 million in 2024-25.

state that in future years it will review and adapt its investment strategy as interest rates stabilise.

This is to ensure that “cash balances are optimised and reinvested to support the long-term sustainability and development of our academies”, trustees said.

The trust added, however, that it “anticipates lower yields in future years as cash balances decline and interest rates stabilise”.

On 5 February 2026, the Bank of England decided to hold its interest rate at 3.75 per cent. Economists forecast the next rate cut will come in April, and the rate will gradually stabilise in the coming years.

Big increases in MAT investment income

Some trusts saw particularly sharp increases in investment income from a relatively low starting point, with (42 primaries and one middle school) recording a 558 per cent rise in investment income to £283,000 in 2024-25.

(16 primaries, 16 secondaries and seven all-through schools) similarly saw a 131 per cent increase, from £291,000 to £672,000 in the same time period.

This mixed picture among the largest multi-academy trusts comes amid a growing awareness across the sector of the benefits of actively managing surplus cash.

The shows that academy trust investment income has risen sharply over the past two years.

Trust investment returns across the sector increased by an average of 295 per cent per pupil between 2022-23 and 2024-25, the report says.

Single-academy trusts recorded the largest proportional growth, from £6 per pupil in 2023 to £35 per pupil in 2025.

Small multi-academy trusts, with fewer than 3,000 pupils, increased investment income from £8 per pupil in 2023 to £28 in 2025, while medium-sized MATs, with 3,000 to 7,500 pupils, saw an increase from £7 to £27.

Large MATs, with more than 7,500 pupils, had the smallest proportional increase but from a higher base, rising from £15 to £39 per pupil over the same period.

Analysis shared with ����Vlog by accountants Bishop Fleming shows large MATs made an average 3.2 per cent return on their cash investments in 2024-25 - the same as in the previous year.

Medium-sized MATs saw an increase in returns from 1.9 per cent to 2.4 per cent in the same time period, while SATs reported a jump from 1.9 per cent to 2.2 per cent.

Avoiding investment risk

Ian Buss, an whose firm advises around 300 trusts, said his clients collectively generated around £32 million in cash deposit interest in 2025.

Most trusts were earning returns of around 3.9 per cent, on average, he said, by spreading cash across instant-access and fixed-rate accounts.

With the right strategy, trusts can earn between 3.5 per cent and 4 per cent interest on their spare cash and reserves, he added.

Mr Buss said effective investment depended on detailed cashflow modelling rather than speculation.

“It’s about maximising working cash and reserves, not chasing risk,” he said.

Department for Education guidance, , states that trusts can invest “by reviewing current trust bank and saving accounts, cash reserve locations and interest rates available to establish where or how investment returns may increase”.

This, the guidance continues, can include reviewing the type and number of accounts held, but trusts must avoid “capital at risk investments” - where funds could be partly or wholly lost.

Schools and trusts held more than £6 billion in reserves in 2023-24, according to the DfE.

The only for schools and trusts is called Insignis.

Fears over ‘inequalities’

Sam Henson, deputy chief executive of the National Governance Association, said the investment trend could reflect improving financial capability across academy boards, with trusts applying “business acumen and expertise to make the most of public money”.

However, he warned that not all trusts were equally well placed to benefit.

“Larger MATs have the scale and specialist capacity to pursue these opportunities in ways some smaller trusts simply cannot, and we shouldn’t create a system where financial returns compound existing inequalities,” he said.

Mr Henson added that while the DfE guidance had improved, “further guidance and concrete benchmarks with clear options would help all trusts make informed investment decisions”.

Increased awareness

David Clayton, chief executive of Endeavour Learning Trust, which runs six primaries and four secondaries, said investment income was ultimately driven by cash flow.

“As a trust, we use the Insignis platform to proactively invest surplus cash in order to maximise returns,” he said.

£61,000 in investment income in 2024-25, down from £82,000 the previous year.

“In 2023-24, we were carrying additional capital funding, which was then used to fund substantial capital investment during 2024-25, meaning the surplus funds available for investment reduced, hence the reduction in investment income,” he explained.

Mr Clayton said the sector had become “much more aware” of opportunities to earn interest on reserves, adding that investment platforms had “made this much more accessible for smaller trusts who may not have had the capacity to exploit these opportunities historically”.

Income ‘should not replace core funding’

Leora Cruddas, chief executive of the Confederation of School Trusts, said that while investment income could provide useful additional funding, trusts should not have to rely on self-generated income.

“Trusts need to maximise every drop of income, and the responsible use of funds to generate bank interest can provide some useful extra cash,” she said.

“It cannot, however, replace core funding from government, which must be sufficient to provide a high-quality, inclusive education and not rely on trusts generating additional income.”

Benedicte Yue, chief financial officer of River Learning Trust, said growing awareness and new technology had helped trusts to improve returns, but warned the system was inherently unequal.

The trust runs 20 primaries, 10 secondaries and one alternative provision setting.

“You need to have reserves to generate investment income in the first place, and then you need the capacity to invest them properly,” she said.

“Primary trusts, specialist schools and those already under financial pressure often have much less ability to benefit from this.”

generated £751,000 in investment income in 2024-25, up from £520,000 the previous year - a 44 per cent increase. Ms Yue said this was helped by its main banking provider automatically sweeping surplus funds into interest-bearing accounts.

Ms Yue said innovations, including AI-driven cash management tools, had helped trusts to maximise returns even as interest rates had begun to fall.

“But it’s great for us, and not necessarily equitable for the sector as a whole,” she added.

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