Warning over debt collectors

Schools have been warned against using ‘‘third party agencies’’ like debt collectors to obtain voluntary donations from parents.

The Ministry of Education sent out a warning memo to schools against the unlawful practise on Monday.

It said: ‘‘We have been informed by the Office of the Auditor General that some schools are entering into a contract with a third party, for the purposes of collecting fees and donations on the school’s behalf.

‘‘Schools entering into these contracts may be in breach of the Crown Entities Act.’’

According to the ministry notice, ‘‘no income for the school can be paid directly to a service provider trust account, proprietor or any other third party’’.

‘‘The ministry does not support such arrangements as it may be in breach of the Crown Entities Act and we urge all school boards to seek their own independent advice before deciding to enter into such arrangements.’’

Ministry head of sector enablement and support Katrina Casey said the Office of the Auditor General received a query from a school’s financial service provider asking if the school was legally entitled to enter into a contract with a debt collection agency.

‘‘We’re not currently aware of any schools doing this, although we do get queries from time to time.’’

Schools were funded to deliver the curriculum, and donations formed a small part – 1.8 per cent – of overall school revenue, she said.

‘‘The payment of donations is entirely voluntary. Parents cannot be made to pay donations if they choose not to,’’ she said.