TORY plans to make every school in England an academy were cast into turmoil yesterday by new concerns that academy leaders are pumping public cash into other private businesses.

Labour revealed that more than 40 per cent of academy trusts, which are publicly funded but outside of local authority control, have made payments to businesses or organisations in which a school director or trustee has a financial interest.

The number of academies making such payments, described as “not normal” by the Department for Education, has soared by 11 per cent since last year.

An increasing number of the transactions were described as irregular, meaning that the goods or services were not provided at cost or that school trustees failed to follow normal procurement procedure.

Shadow education secretary Lucy Powell said officials had failed to get a grip on “the finances of the thousands of schools [they are] trying to run directly from Whitehall.”

Turning England’s schools into academies “will only make this situation even worse.”

Education Secretary Nicky Morgan came under fire in the Commons yesterday, including from some of the 40 back-bench Tories pressed by parents to oppose the plan.

In a bid to stop the rebellion growing, Ms Morgan reportedly may let councils run their own academy chains.

But teachers’ union NUT leader Christine Blower called that “an absurd proposition” which would cost millions “for no good purpose.”

Ms Blower said it was a sign Ms Morgan was “clearly rattled,” but “it certainly would not be the U-turn that parents, heads and governors, councillors — in fact just about everybody — seeks.”