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To wonder why fee paying schools have charitable status?

(27 Posts)
JakeBullet Thu 01-Nov-12 08:23:56

I must admit to being a bit thick here but I did not realise that many fee paying schools had charitable status. I only realised it when I read BBC news today, with Lord Adonis asking why they are not taking a lead in sponsoring Academy schools.

Now I do realise that fee paying schools provide bursaries and perhaps loan out facilities at times but if they are indeed charities set up to provide education then surely it makes sense that they should be using some of their expertise beyond their own grounds and supporting schools where children do not have the same advantages as their own pupils.

Then again if the Govt have set up Academies with the idea that private schools will take the helm in sponsoring failing state schools then I doubt they have thought it through as the private schools seem entirely uninterested.

By the way, this is NOT a private versus state debate....I have no hard feelings either way personally, if I could afford it then DS would be in an independent school for children with Aspergers and ASDs.

Is this a case where if the schools DID reach out to other schools that fees might rise to cover the costs?

Help me understand this.

CailinDana Thu 01-Nov-12 08:30:47

Charitable status doesn't refer to the activities of the organisation, it refers to its tax status. I work for a professional body that provides registration and information for members of a certain profession and we have charitable status as we don't make a profit. It means that we can get things like software at a reduced rate. There are certain criteria an organisation needs to meet to gain charitable status but doing community work/helping the disadvantaged isn't one of them.

Shagmundfreud Thu 01-Nov-12 08:32:05

They have it so that they can provide bursaries and scholarships, which MOSTLY go to the sort of children who are so clever and hardworking they would rise to the top in any half decent institution. Particularly as these children come from households where the parents have a massive involvement in their child's learning.

What they don't do is offer help to those children who would really benefit from the small class sizes and individual attention kids get in private schools - ie those children from poor families who have very little parental support at home. Because people who are paying don't want their children sharing a learning space with kids like this.

limitedperiodonly Thu 01-Nov-12 08:37:30

As another poster has said they're not charities. It's a tax wheeze. Wouldn't it would be lovely if all private businesses could reduce their tax bill or offer more advantageous fees to clients by offering bogus charitable activities?

scaevola Thu 01-Nov-12 08:45:55

They have it because many schools predate state education, some by several centuries, and the provision of education is recognised in itself as a charitable act.

Charities, all charities, are allowed to provide services in return for fees.

Until the huge fee rises of the early 2000s, those fees were nowhere near as expensive, compared to income, as they are now.

Charitable status is not required to provide bursaries etc.

There is no provision in law to allow any charity to "relinquish" its charitable status. Schools would have to sell all land, equipment and other major assets at full market value, and give the proceeds to other charities with educational aims. This would led to many closures. And that would break the state system, as it would need to provide new school buildings and year on year cope with the additional pupils (7% of current total pupils in UK?)

JakeBullet Thu 01-Nov-12 08:52:22

I don't think sharing a learning space is the issue....this wouldn't happen. I don't see that bus loads of deprived children would end up in the same classroom as children of fee paying parents.

I suppose what I thought was that the schools would share their knowledge and expertise about providing excellent education....giving guidance from a distance about the running and management structures.

My sons school is Good to Outstanding according to OFSTED so isn't in the running to become an Academy. I know other local schools which ARE though and which might really benefit from the knowledge and experience that the private schools might be able to provide.

At present our local Academies are partnered up with Outstanding schools.

I have only ever spoken to one head teacher of a private school and he seemed to spend lots of time "managing out children who are not able to cope academically". Obviously State schools cannot do this....

I am aware though tha private schools have other advantages for helping children reach their potential and it's this I'd love to see shared.

Shagmundfreud Thu 01-Nov-12 10:42:19

"I am aware though tha private schools have other advantages for helping children reach their potential and it's this I'd love to see shared."

I so agree. They should open all their facilities - swimming pools, gyms, music practice rooms free of charge to the most disadvantaged children in their borough. Really spread the joy.

Would love to see the private school down the road from me with the 100% GCSE A-C pass rate open up its doors to the children attending a state school 2 miles away which was named a couple of years back as one of the worse 17 schools in the entire country. If nothing else it might precipitate a 'backs against the wall' proletariat revolution as the children from the sink school are made aware of the reality of how the other half live.

OneMoreChap Thu 01-Nov-12 11:10:48

I went to a private boarding school.
It was a direct grant school, until the Labour party in their purge of Grammar schools abolished the direct grant... and so poor but bright kids could no longer get there easily. Full of service kids, ex-pats kids etc.

Swimming pool, squash courts, rugby pitches; hardly any non-Oxbridge teachers; no poverty of ambition for kids, regularly 5-10 pupils off to Oxbridge.

I blame Shirley Williams and her ilk for pulling up the ladder that many Labour MPs of her day had used to climb...

Yes, I agree with the OP that expertise should be shared, but I still reckon a lot of the problem is supportive parents, over-regulated but insufficiently rigorous teaching, a poverty of knowledge and ambition from teachers as to how to get kids into good places, and our insane contempt for engineering/vocational skills.

Whew.

tabbytolst Thu 01-Nov-12 11:23:27

Another way to look at it is that parents who send their children to fee-paying schools are reducing the strain on public resources. Each child not attending a state school saves about £3000 on the education budget as a whole. Admittedly it doesn't do much for social cohesion, but it does make the education budget go further for those who really need it.

WilsonFrickett Thu 01-Nov-12 11:29:15

I suppose what I thought was that the schools would share their knowledge and expertise about providing excellent education

That's pre-supposing they do have knowledge and expertise about providing excellent education? For example, debate regularly rages on here about private schools employing teachers without teaching qualifications and I've heard that from enough MNers to believe that at least some private schools do this. That's not excellence, IMO.

'Private' is not a synonym for 'good'.

WileyRoadRunner Thu 01-Nov-12 11:39:51

"I so agree. They should open all their facilities - swimming pools, gyms, music practice rooms free of charge to the most disadvantaged children in their borough. Really spread the joy."

My children's private school does ALOT with the local primary school. They are collected by our mini buses and given swimming lessons, sports lessons and use our facilities for this, and our arts department.

Also a school doesn't have to be failing to become an academy. Our local grammar school is one of the best in the country and is applying for academy status to allow them to take control of their own finances.

exexpat Thu 01-Nov-12 11:41:10

I think most private schools, at least at secondary level, are operated on a non-profit basis - any surplus gets ploughed back into the school facilities or into bursary schemes. If they lost charitable status, bursaries would have to be cut, and you would get more private companies trying to run profit-oriented schools. Not actually a move for the better, IMO.

Hayleyh34 Thu 01-Nov-12 11:44:06

A lot of private schools do share their facilities. I grew up in Harrow and used the Harrow School olympic size swimming pool and trained on their baseketball court as well.

Shagmundfreud Thu 01-Nov-12 11:45:10

I long, long, long for someone to do a 'teacher swap' programme, where they'd take some teachers from Eton/Winchester or some other lauded private school and film them over a month teaching middle to bottom sets at a low achieving inner London comp. Would be bloody marvellous and so educational.

WilsonFrickett Thu 01-Nov-12 11:46:24

ooooh yes Shagmund

OneMoreChap Thu 01-Nov-12 11:50:19

Shagmundfreud
I long, long, long for someone to do a 'teacher swap' programme, where they'd take some teachers from Eton/Winchester or some other lauded private school and film them over a month teaching middle to bottom sets at a low achieving inner London comp

Lots of dim kids at many of these schools - or at least there were at mine many years ago. They had remedial classes, detention, and support from their peers.

I think there's a cultural issue; even if you weren't so bright, your peers wouldn't put up with disruption.

StillSquiffy Thu 01-Nov-12 11:57:16

There is no structure in place to allow schools to easily rescind their charitable status, so most schools are stuck with the status even though they would in many cases find it easier to not be charities, especially given state pressure on the educational benefit to the poor side.

Saying that, I think most private schools would actively seek to be involved in benefitting the commnity anyway, regardless of status. Many private schools go way beyond their minimum obligations, for example.

FWIW, the value to the govt of not having all the private pupils in state school has been calculated at £2.5bn per annum, against a cost arising from the tax breaks of £100m per annum.

That tax break cost, by the way, equates to £200 per private pupil, per yr. Given that fees go up to £30,000 at some schools, it is not a major deal for schools to have charitible status (and I imagine if the tax loop was closed, they could easily recoup losses if they chose to by restricting burseries, leasing out their sports facilities back to the LEA at market value, etc, etc)

A good and reasonably objective review including a summary of the history that led to these schools being charities was presented to Parliament earlier this year ref SN/HA/52222

JakeBullet Thu 01-Nov-12 12:02:45

Definitely there are children who really suffer due to neglect or lack of parental support. They dont do well because trying to teach children who can barely cooe with social situations is very difficult. Ad thank you to whoever pointed out that private does not always equal good because I have always assumed that private schools could afford to hire very experienced teachers.

I was indeed forgetting that schools can opt for Academy status without being failing. I just know in my own area that the local schools which have failed have ad Academy status foisted in them rather than by taking the decision themselves.

ladygoldenlion Thu 01-Nov-12 12:32:12

The Academy title can refer either to schools that are failing or (in the case of ours) schools that are good / outstanding and therefore can run themselves. There is no difference in the name though so lots of people do think Academy refers to a failing school.

Not well thought through...

bachsingingmum Thu 01-Nov-12 13:39:26

If you're interested the accounts for all UK charities should be on the Charity Commissioners website. I do look at the accounts for my DD's school (when the fee rise letter arrives...) and it is clear they run pretty much hand to mouth at the same time as providing bursaries and other community work. So they would pay very little tax if they lost charitable status anyway.

ReallyTired Thu 01-Nov-12 13:41:31

"That tax break cost, by the way, equates to £200 per private pupil, per yr. "

How do you work that out.

StillSquiffy, I might have missed something. Fees at our local private secondary are 15K. If the parents had to pay 20% VAT then the fees would be £3K higher.
If the schools had to pay business rates and coorpation tax then the bill would be even higher.

The cost of funding a child at a state secondary school is between 4K and 9K. It doesn't save the tax payer as much money as you think having a child at a private school.

[[http://www.bbc.co.uk/news/education-12175480]

Some private schools do take their chariable status seriously like Manchester Grammar. I would like to see this policed a bit better.

www.guardian.co.uk/education/2012/jul/19/twigg-private-schools-lose-charitable-status

scaevola Thu 01-Nov-12 14:03:43

The provision of education is VAT exempt. There would be no direct additional bill to the parents for the fees.

It means that the schools would not be able to claim back VAT on goods and services which it purchases. And in general, it's not considered to be a valuable tax break. There is no provision in UK law to relinquish charitable status and just carry on (the charity has to be wound up, so the school would close) - schools are not choosing to be charities for any current financial reason. It's what they are, and in some cases have been for centuries.

RyleDup Thu 01-Nov-12 15:24:09

A private school near me has taken over a primary state school which was in special measures. The school has improved quite a bit since then.

TalkinPeace2 Thu 01-Nov-12 15:30:30

my crammer charged VAT

charity tax law is complicated but the MAIN advantage of charity status is that they do not have to pay corporation tax on annual surpluses put aside for capital expenditure

but as charities they are limited on what VAT they can reclaim (unlike state schools)

at the moment lots of private schools are really struggling - their fees have risen by double inflation over the last 18 years and now parents are stamping their feet
expect more sudden closures at the end of this term....

MrsKeithRichards Thu 01-Nov-12 15:48:40

My sons private nursery used to fundraise, take computer for school vouchers and such like. How they could do that, take £600 a month of us in fees and keep a straight face I'll never know.

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