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Private schools - should they scrap their bursaries?

(120 Posts)
SomeGuy Sun 04-Oct-09 04:02:16

I was interested to read this report from the Charity Commission.

Basically they tested five schools to decide whether they were charitable or not. Fees ranged from £6k to £15k per year.

The definition of charitable is a new one, since 2008. It is here.

The key criterion is

"F3 Principle 2b Where benefit is to a section of the public, the opportunity to benefit must not be unreasonably restricted"

in particular

"F10. Restrictions based on ability to pay any fees charged

Charities can charge for the services or facilities they provide. They can also charge fees that more than cover the cost of those services or facilities, provided that the charges are reasonable and necessary in order to carry out the charity?s aims, for example in maintaining or developing the service being provided. However, where, in practice, the charging restricts the benefits to only those who can afford to pay the fees charged, this may result in the benefits not being available to a sufficient section of the public.

...
The fact that the charitable facilities or services will be charged for, and will be provided mainly to people who can afford to pay the charges, does not necessarily mean that the organisation does not have aims that are for the public benefit; however,
an organisation that excluded people from the opportunity to benefit because of their inability to pay any fees charged would not have aims that are for the public benefit.

Therefore, where charities do charge fees, people who are unable to pay those fees must, nevertheless, be able to benefit in some material way related to the charity?s aims. This does not mean that charities have to offer services for free. Nor does it mean that people who are unable to pay the fees must actually benefit, in the sense that they choose to take up the benefit. They must not be excluded from the opportunity to benefit, whether or not they actually do so."

Basically they have determined that poor people must benefit in some way from private schools in order to have charitable status.

Of the five schools assessed, means-tested bursaries were advertised at four. The percentage of fee income going towards bursaries was: 14%, 10%, 5%, <1%, and 0.

The schools spending 5-14% of fees on bursaries were judged to be charitable, the last two were not, the stated reason being that they did not provide access to people "in poverty", and in order to do this schools must offer 100% bursaries.

The schools spending 5% and 10% were criticised for failing to help people in poverty - in other words, while quite a few pupils there are on bursaries, they are partial ones, and only 1% got 100% bursaries, the schools preferring to offer smaller discounts to a larger number of people. The Charity Commission says that a 90% bursary is insufficient for people 'in poverty', and 100% bursaries are the necessary feature to be deemed to helping the public.

By contrast, Manchester Grammar, the school spending 14% of income on bursaries, 8% of pupils are on 100% bursaries.

The Charity Commission also criticised one school, where "all the governors are parents and therefore they all have a conflict of interest in relation to the provision of free or wider public access".

Which is a fair point, but is it as it should be?

Fitness First are not opening up their gyms to people "in poverty". Gordon Ramsay does not offer free food to people "in poverty", and the Groucho Club is not opening up either.

The difference of course is that they are not charities.

But should private schools be? The value of the private school charity tax break is suggested to be around £100m, something like 1% of income for these schools, so plainly it is dwarfed by the cost of paying an additional 10% on fees to benefit those "in poverty".

Isn't this irrational? If you buy a TV online, you would be unlikely to choose somewhere that tacked 10% on to the purchase price to help buy TVs for the poor.

If consumers of private school education want to educate the poor, surely they would be better off doing so by sending £1k/year to a charity operating in a country where schools lack books, teachers and equipment?

The interests of the great bulk of parents at private schools would be best served by not providing any bursaries at all, and reducing fees accordingly.

There may be exceptions for places like Eton, which have a long history and tradition of providing such bursaries, but most schools are not encumbered in this way.

My son's school is unlikely to receive much in the way of endowments from grateful ex-pupils, it merely provides an education to its pupils, and as a cost-conscious consumer, I'd appreciate it if it would do so at the lowest possible cost, which would definitely preclude bursaries.

bloss Sun 04-Oct-09 08:04:10

Message withdrawn

seeker Sun 04-Oct-09 08:10:40

Presumably if private schools want to give up their charitable status and the tax exemptions that go with that status they can?

wicked Sun 04-Oct-09 09:14:32

Under the charities act, independent schools are stuck with their charitable status. Hands are tied.

mimmum Sun 04-Oct-09 09:21:49

Actually they can't get rid of their charitable status. All their assets belong to a charity and these can't be transferred to a normal company it would be illegal. So recent changes in legislation are actually very penal imo.

carocaro Sun 04-Oct-09 10:39:56

Are you a bit fed up with the riff-raff at your school getting a cheaper ride and then, as you say, never making a contribution back in later life? You have the evidence to back this claim?

ABetaDad Sun 04-Oct-09 10:53:07

I have to say that my DSs go to a fee paying school and get a small bursary and a discount for second child.

I was approaced by a parent who has a very bright child at a local state school but cannot afford to send her private for 6th form.

I told her to go and enquire about bursaries at my DSs school. She was told she could not get one unless her DD had already been in the shool on full fees for 5 years. They would not give her exact details of how bursares are decided either. I was shocked as the bursary package is not at all well advertised but if you can find it on the website it does say it is specifically for children in low income families.

Obvioulsy only childen who are in low income 'now' because parents have fallen on hard times but were rich enough in the past to afford full fees. The Governing body is dominated by local parents and local well connected people too.

SomeGuy Sun 04-Oct-09 12:15:27

That's interesting mimmum - this change in legislation basically amounts to a stealth tax on parents with children at private school.

What doesn't seem fair is that the parents are essentially going to be forced into making a donation of probably typically 10% of fees - but this 10% will come out of taxed income, in contrast to normal charitable giving.

I wonder if it would be possible to restructure school fees so that the bursary charge is both made explicit and is structured as a donation

SomeGuy Sun 04-Oct-09 12:16:11

the purpose of it being a donation of course would be to make it tax-deductible.

SomeGuy Sun 04-Oct-09 12:22:03

ABD: that doesn't surprise me really. I know a nurse who sends her son to St Paul's School (due to the fact that she lives in inner London and the alternative would be local state schools, which are utterly terrible), I was sure that she would be able to get a bursary, but apparently not.

By contrast, I don't think my son's prep school should provide bursaries - the state primaries are pretty good, and in this area private education at primary level is most definitely a luxury, and it's hardly as if they could bus primary school children in from Hackney.

LIZS Sun 04-Oct-09 12:24:09

The ones at dc school are now funded entirely separately to fees, through endowments, donations and fundraising, so it is impossible to generalise. The fees are strictly towards running costs, salaries , up keep of facilities etc. Of course it may be true that some of those funds may otherwise have been directed towards the benefit of the school itself so they have lost out and are forced to charge more accordingly.

If you want to argue the case of stealth taxes think of how parents who opt to use independent schools still pay taxes towards state education and are denied access to other LEA funded resources.

ampere Sun 04-Oct-09 19:51:41

LIZS- slightly dangerous ground: My taxes go towards refuges for gay men, towards hostels for unmarried teenage mums, to provide neonatal care etc etc, none of which I will ever access.

Just because we don't or can't use a public service, doesn't mean we can feel aggrieved at having to fund it.

It's called civil society.

MrsGhoulofGhostbourne Mon 05-Oct-09 07:52:31

Beta dad - the sixth form thing is I believe quite common - she may have got a burary as a newbie if she had come in a lower age group. Also at the momemt people have told me that in our neck of the woods -don't know about elsewhere - bursaries are prioritised to existng pupils whose parents have fallen on hard times than new pupils, as fairer not to disrupt the education of a child in situ than give to one who has not had it.

ssd Mon 05-Oct-09 08:22:26

even if we could afford it, the op's post reminds me why I'd never send my kids to private school

I don't want my kids to grow up to be judgemental snobs with no care for others who aren't in their position

scaryteacher Mon 05-Oct-09 11:20:06

I think the schools are in a cleft stick here. If they are already opening their facilities to the community, and letting their teachers go off to teach in state schools (I know that Charterhouse does this with Park Community school in Leigh Park in Hampshire, which is in a very deprived area), then surely that is helping those who couldn't afford the fees and hits the definition of public benefit.

I think the judging purely by bursaries is mean as some schools like the preps who failed the visitation of the charity commissioners do not have endowments and may be striving to meet the public benefit criterion on other ways. It's NuLab spite imvho.

MrsGhoulofGhostbourne Mon 05-Oct-09 11:49:58

Scary teacher - indeed. It could be argued that giving assistance to local schools and otehr groups is more beneficial than providing bursaries as it gives assistance to a wider number of students, and helps the teachers in the recipient schools up their game. I know one of our local independents in SW London offers additional math classes to y5 pupils of any ability (to schools which will accept them! grin)as part of the 'children's university' scheme - this means that many more children of all abilities receive the benefit than only those offered bursaries who will only be the cleverest children, and already advantaged compared to those less able who lose out both ways in the existing school system.

SomeGuy Mon 05-Oct-09 14:17:06

> even if we could afford it, the op's post reminds me why I'd never send my kids to private school
>
> I don't want my kids to grow up to be judgemental snobs with no care for others who aren't in their position

I'm not sure I understand. I don't drive a BMW, Mercedes, Porsche, or whatever, but if I did, I wouldn't expect drivers of those cars to have to pay 10% of the price to fund cars for people in poverty.

And whereas the government won't give you a car if you can't afford one (except possibly if you have a disability), they certainly do provide universal free education.

If state schools aren't good enough, then we either need to spend more on them or else enforce better discipline. But no part of this should fall selectively on consumers of private education.

tattycoram Mon 05-Oct-09 15:49:24

Someguy, you just don’t get it do you. Education is a social good and the fact that resources are distributed differently between private and state schools and that not all children have access to the same resources has an impact on society. Of course, you have the right to choose whether you send your children to private or state schools, but you are not buying education in the way that you buy a posh meal or a flash car.
Anyway I don’t see anyone expecting “consumers” of private education to pay more to state education, other than by dint of the fact that by definition they are almost certainly higher rate taxpayers.
I know that you are in favour of assisted places and it makes me pretty angry that you are happy to see the wider tax paying community, the vast majority of whom will be on lower incomes than you, subsidise children to go to private schools, but you do not want to help pay for the education of “poor people”.

wicked Mon 05-Oct-09 17:31:09

Some state schools, eg Morosky's, are as well resoursed as most independent schools.

Lots of independent schools are quite archaic in their resources, eg no interactive whiteboards.

Resources are indeed distributed unevenly, but you can hardly blame independent schools for that. There is much diversity within state schools, so you should really leave independent schools out of that particular argument.

Cosette Mon 05-Oct-09 18:05:28

So it's not unreasonable that if a private school wishes to have charitable status, then they should meet a "public benefit" test (and what constitutes "public benefit" is a discussion in its own right). What surprises me, is that I had always assumed that if a school couldn't or wouldn't meet the "public benefit" criteria, then they had the option of not being a charitable organisation, forgoing the tax benefits, and managing their finances accordingly.

But from what mimmum says, this is not an option - the option is to pay the 10% (or so) towards funding 100% bursaries, or presumably go out of business as a charity - in which case what would happen to the assets, as these cannot be transferred to a company?

As many parents struggle to pay fees anyway, this change of the rules seems to be unfair as there is no way of opting out of charitable status.

SomeGuy Mon 05-Oct-09 18:15:23

> Someguy, you just don’t get it do you. Education is a social good and the fact that resources are distributed differently between private and state schools and that not all children have access to the same resources has an impact on society. Of course, you have the right to choose whether you send your children to private or state schools, but you are not buying education in the way that you buy a posh meal or a flash car.

But my income can also buy private tuition for my kids, trips to the opera, educational trips abroad, books - the access to resources don't stop at school.

On my son's birthday last year lots of children played in our heated inflatable pool. Good fun. All except for one child. Turns out Daddy's worth £50m and had just bought a house with his own swimming pool.

Should he have to pay a special levy on his school fees to make up for the fact that my son doesn't have the same access to resources as he does?

> I know that you are in favour of assisted places and it makes me pretty angry that you are happy to see the wider tax paying community, the vast majority of whom will be on lower incomes than you, subsidise children to go to private schools, but you do not want to help pay for the education of “poor people”.

But as you said, education is a social good. If society has a duty to pay for children's education, the cost should fall on society as well.

Otherwise, as I mentioned, you would fund motability vehicles by taxing Porsche drivers.

And we don't do that, because as a society things are funded in aggregate - parents at private schools will, on average, pay significantly more tax as their incomes are higher.

You can't have it both ways. Either state education is adequate, in which case there shouldn't be a compulsion to help a very small number of children escape it (a 10% levy would mean less than 1% of children getting free places), or it isn't, in which case a society we need to improve it.

Otherwise, can I propose a book levy - any household with more than 100 books should have 10 books seized and given to those 'in poverty'.

SomeGuy Mon 05-Oct-09 18:17:08

Indeed cosette: historically it was seen that providing education (on a not-for-profit basis) was providing a considerable social good, but now it seems that is not enough.

seeker Mon 05-Oct-09 18:33:48

I have to say that I find it hard to have sympathy for people "struggling" to pay private school fees. There are parents at my child's school 'struggling" to come up with a spare 19 quid for a achool trip to London!

Cosette Mon 05-Oct-09 19:40:17

yes of course, and I used to be one of those parents, struggling to pay for that school trip to London and indeed to put food on the table - there is always someone worse off, and someone better off too. I'm very lucky, my financial situation has since improved (lots of luck and hard work), and I can now afford to pay school fees (although not easily).

If the school fees go up, and smaller (usually cheaper) schools go out of business, then not only will more children need to be educated from the public purse, but we will end up with private schools really being only for the very rich, and totally out of the reach of the middle classes.

I don't object at all to private schools giving something back in return for charitable status - or just because they can (on the contrary, they should), what is unfair is that the rules are changing, without the option for schools who can't fund the free places to choose to give up the charitable status.

seeker Mon 05-Oct-09 19:43:23

The % of children educated privately is so small that I think the public purse could probably manage to absorb them.

I think it is outrageous that private schools have charitable status.

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