On another thread I got pleasantly trounced for daring to infer that a Private school was profit driven

[Twiglett]

and I was corrected

so now I'm left wondering

what is the business model behind a Private school? Are they all the same? Do none of them have shareholders / owners

actually I didn't really 'infer' .. I said .. rather directly

Most are charities, from what I know. Of the local ones whose legal status I know, one is a charity, one is a charity but associated with the C of E, and one is privately owned by a person.

Obviously, even charities, have to be cost/profit oriented to some degree, though. They can't just set fire to bundles of cash for fun. (Any more than a state school could.)

surely they are a business,they need money to pay the staff ,buy stuff etc,so the money from fees is used for that.
No shareholders though ,but lots of businesses don't have shareholders.
I am confused now.

Businesses all have shareholders or owners. Charities don't - they have trustees, but, unlike shareholders or owners, trustees don't get to wander off with any spare cash left after all the bills are paid.

They have charitable status from the days before state education. And it's a con - why should the rest of us pay higher taxes to fund the education of the rich or well-off? Eton has charitable status FGS.

I know parents of private school kids wil argue they are somehow helping the state by opting out, but that's a false argument - no-one pays to do the rest of us a favour. And by opting out they reinforce privilege and class divides, which are actually getting worse in this country, not better, since Thatcher (and Blair has continued her legacy). Families who struggle to get by and have no way of avoiding their kids being dumped in sink schools are subsidising Etonians!

The school I teach at has charitable status. I don't know what you meant by 'profit-driven' - didn't see that thread; who were you suggesting profited? The school I'm at ploughs all the money back into paying our salaries,paying for books, etc fot the students, repairs and renovations, developing the school's facilities...The head doesn't pay himself a big city-style bonus at the end of each year or anything like that! Remember we get no funding from the government so we're profit-driven in the sense that if we don't make the money needed to stay open, we go under - fairly straight-forward, I would have thought!

my DDs school has charitable status and profits are ploughed back into the school, attracting good quality staff, facilities and so on .. no one makes a profit out of it as an individual, there are no shareholders, dividends and so on. I would expect that salaries are higher than in the state sector though but then they want to be in a position to attract good staff so that's fine with me. I have heard of other schools where they are owned privately and are limited companies and everything is viewed from the profit point of view.

You do get the equivalent of government funding from tax relief, though.

They only get tax relief on any donations they get, I'd guess? Not on school fees?

NQC-thanks for clearing that up

99% of them are charities and no one draws any profits.

I would agree with Xenia that at secondary level the vast majority of private school are in fact educational charities, set up with a board of Trustees who have the duty to ensure that the aims of the charity are executed. There will be a day to day management team who look after the actual runnig of the school but the Trustees will oversee the finanical requirements etc. Setting fees at secondary level has actually been quite difficult to guage - if you set them too low then you're not making similar investments to other schools in terms of buildings and equipment, if you set them too high parents will just head for the other schools. Hence the recent price-fixing scandals.

At primary/prep level there are more (often smaller) privately owned schools, though the majority would still be charities. The dcs school is privately owned, and both owners work for the school - one as principal and one as bursar. Strictly I understand that the school buildings etc are in a trust but they are the beneficiaries of that trust, and therefore they could sell up at any time.

The owners will expect a reward in terms of their time (salary) and any capital they put in. They're not looking simply to make as much money as quickly as they can - they need to have a sustainable effort with continued investment so that parents wil be attracted to the school - contrary to common opinion on Mumsnet the parents are not stupid and will look elsewhere if they feel that their children are not receiving the education that they were expecting. The school is effectively competing within a local market (I can name 11 private schools of the top of my head that would be within a suitable distance for us, and there may be more), so they can't just hike the fees up whenever they want - the parents would start to drift to the nearest prep school. As they are not charitable there is no bursary scheme unlike some of the other lcoal private schools. That said, our particular school aims to specialise in getting scholarships to the secondary schools for music and sport (as well as academic scholarships), and in the event that a very promising pupil struggled with fees then a subsidy would probably be offered.

ooh dh is looking at investing in a chain of private schools

perhaps i should get him to come and give you a teach-in twig

ps he wouldn't be looking to invest if there weren't bucks to be made

ggirl, I think that they get benefits via being VAT exempt (or at least the parents benefit from this!), as well as not paying corporation tax on any surplus that they make in a given year.

NQC, they get tax relief on all their activities, not just on donations.

But it is not like gift aid though - what it means is their income is not subject to tax (and in reality if they lost this status it would only be any profit that is subject to tax - they would be allowed to deduct salaries and running costs like any other business).

Oh twiglett - I was interested in that too.
Because I really couldn't understand how my local GDST school works financially.
24 children in reception class. 2 classes. 48 children. Approx. £10000 per annum fees. Equals £480000 per year from Reception.
I really don't understand how it works.

Slayerette - just read your post. Think I understand a bit more now.

Wow - as a reception class your class income is over double ours (in part because we only have 16 in the class, but even so). How many TAs do you have?

sorry to be in utter pendant mood this morning but it should be imply in the title, not infer. Not many people knew the difference but I just finished reading something about it so I though I would annoyingly share it.

"INFER vs. IMPLY

The best way to remember the difference between these two words is to think in terms of the model used by communications theorists. Communication consists of a message, a sender, and a receiver. The
sender can imply, but the receiver can only infer. The error that usually occurs is that the word infer is mistakenly used for imply.

WRONG: Are you inferring that I am a fool?
RIGHT: Are you implying that I am a fool?

If someone gets the idea from your behavior that you are a fool, then he is inferring that you are a fool. But if he is subtly letting you know that he thinks so, then he is implying that you are a fool. You, of course, can infer from his implication that he thinks you are a fool.

IMPLY = to put the suggestion into the message (sender implies)

INFER = to take the suggestion out of the message (receiver infers)

IMPLICATION = what the sender has implied

INFERENCE = what the receiver has inferred"

On the actual subject of the thread,an ex colleague left to teach at a prep school whose head teacher was forever talking about his profits.

pedantry always acceptable in my book

I had sort of remembered that (you know how you seem to remember one odd fact about eache regular poster?). Sadly I only discoverech the difference when wathcing some awful mel smith and gryff rhys jones from the 80s.

typing whilst bf is never a good idea.