Should giving a bursary to an existing pupil count towards the 'charity provision' of a private school?

[gaussgirl]

Seriously, what do you think?

Someone I know has 2 x DSs at a private prep, largely financed via Daddy's banking bonus. That has gone up in smoke. My acquaintance says it'll be OK as she's SURE the school will give them some financial help because they will want to keep such 'in-house' school socialised DCs, AND by providing bursaries in this way, the school will be able to meet its 'doing good for the wider community' (or however it goes) commitment to enable it to maintain its charitable status.

Sadly I suspect she's right- it will! Privilege has always begat privilege.

I don't necessarily have a problem with the charity status thing- as long as the school IS actually providing a genuine community service! But I'd think paying for a DC from a poor home to get the sort of education available to the wealthy at this school would meet the criteria better than keeping 'one of their own' in clover.

hear hear MB!. So pleased your school was so understanding. Why are people so quick to stick the knife in?

Does anyone remember 'The Retired Gentlefolks Association'? I'm sure that's what it was called- their ads appeared in the back of the Telegraph (of course) when I was young. The basic premise was 'Please give so that these privileged, well to do folk who have never had to worry about money, and who have been cushioned from the nastier aspects of life all their lives BUT who have fallen on hard times in their later years should be allowed to continue living in the style to which they have become accustomed. Will you help?'.

No one's 'sticking the knife in', merely challenging whether charity status can be maintained on basis of bursaries as per OP.

Ah well, you see that is where I will part company from you.

My children, having lived through 18 months of their father dying of cancer, and then being bereaved have a far better than average grasp of the nastier parts of life than most children of their age.

I grew up in the relative poverty of the Rhondda valley in the 1960. I know that their life to date has been far harder then mine at their age.

Giving them the salutary lesson of changing school was, I felt, unnecessary

politics and business need movers and shakers (possibly true)

movers and shakers are a good thing (possibly true)

politics and business employ a disproportionate number of people from private schools (true)

Therefore private schools produce movers and shakers (fucking fallacious- private schools produce people who tend to get jobs in politics and business)

ergo private schools are a good thing (fucking fantastically fallacious- private schools maintain the staus quo)

mb- I am glad your children's school did the decent thing. That is good.

FWIW my dcs attend a prep which doesn't have charitable status but they would offer help to those in hardship (unless the children are such that they would be relieved to be rid of them). Unless there is a full waiting lists of pupils for those academic years etc it is usually in a school's best interest to find a way to help the pupils to stay.

And the banking and other City bonuses haven't actually been awarded yet. Admittedly everyone's expectation are being "managed" downwards, but that happens every year including good ones. The mega performance bonuses may be cut, but it is still too early to assume poverty.

So fwiw gg I don't think that solely giving discounts to the presently financially embarassed is sufficient to count as fulfilling charitable aims (otherwise the dcs school would probably qualify), but nevertheless your friend may well be able to wrangle some sort of temporary discount. But it is all down to individual circumstances of school and family.

OK, it is obviously entirely up to an individual school without charitable status to do exactly what it wants -or is allowed to do by the fee paying parents, I guess, with its bursary money!

Now, the 'vox pop' angle that seems to have crept in can be an obstacle to debate. Often it is intended to be! Even the BBC are becoming guilty of this. They cannot report an item, be it a new piece of government legislation or a town hall issue without digging some hapless member of the public out to interview about how it's all terrible and how it affects THEM badly and is therefore WRONG, despite the fact that others, unseen, might be benefiting hugely from the change.

I am obviously saddened by MB's circumstances. However, also sadly, she won't be alone in what has befallen her family. Yes, it would indeed be very unsettling for any DC who has witnessed family tragedy to have any additional upheavals visited upon them. Obviously we do not know whether the school in question awarded this bursary on a private basis, as might LadyMuck's, or as part of its 'charity' remit. We also do not know nor wish to know what individual MNetters financial circumstances are..

But it does not change the basic premise of the OP which is should a private school be allowed to claim charitable status, a condition supposedly awarded due to that institution's contribution to 'the common good' when it awards a bursary to an existing pupil with a banker father who happened to be in the wrong job at this moment in financial history thus finds himself considerably lighter in the bonus department than before (his bank have already spelled out the reality to the employees).

How is it the kid's fault if the father lost his job? Why does his fathers former occupation make him less entitled to a subsidised place than someone from the local scheme whose parents flunked school and squandered every opportunity given to them.

BTW, on taxes paid, it would be interesting to know the contribution to the public purse made by private school parents, who represent 7% of the nation's school children. I suspect a very significant number - even greater than the represntation in higher education.

Stop whinging and do the math.

Not if that is the only contribution it is making to the common good.

But the point that I was trying to make is that the act of helping out current pupils is part of the normal business model of running a private school. In other words the fact that it does this doesn't detract from it being a school run on a charitable basis. Obviously it would need other evdience to support its aims.

I think that it is still early days in terms of looking at how the charity commission will consider the working of charitible education trusts. The level of tax payer subsidy to these trusts isn't actually that great overall, and it is probably a handful of the wealthiest schools who gain the most benefit in terms of taxfreee investment income. Most charitable schools simply own the school property and need the annual fees to survive. Unfortunately because they have been set up as charitible trusts, then they cannot simply convert their status - it can be quite expensive for them to find a new struccture under which to operate.

Is squeakypop an actual person or just a very bad attempt at a hackneyed old cliche by a very tired, unimaginative troll?

They've been around for a few months - no troll that I'm aware of.

Ha! I've arrived!

Um, the tax burden actually falls unfairly on the poor. The rich pay much less tax as a proportion of their income - hence the hedge fund boss or whatever he was admitting to the Commons Select Committee that he paid less tax than his office cleaners. (Although that was a specific issue about non-doms, IIRC, but it applies more generally due to a shift towards regressive taxes.)

The point about charitable status is that it is a tax break, hence ordinary people who cannot afford private schools are subsidising those who can. I can't understand how anyone can not see the injustice in that situation.

The argument that somehow parents of kids in private schools are actually doing the plebs a favour by 'paying twice' is fallacious. We all pay taxes for things we don't use. I don't drive, I don't get to say 'ooh, can I have a refund for the cost of widening the M1'.

And the key point is, no-one MAKES them pay 'twice', they choose to do it and should stop moaning about it or pretending it somehow makes them particularly virtuous.

The people who really pay lots of unnecessary taxes are smokers - even the most exaggerated estimate of the costs of smoking to the NHS and other services doesn't come anywhere near the billions of pounds extra revenue raised.

Maybe we should be giving every smoker a subsidised place at a public school that they could award to their nearest and dearest?

Hmmm - when you are in the 40% bracket, you are paying more tax and not getting any tax credit.

We all pay VAT for fuel, adult clothing etc - high earners paying more if they spend more.

Lower earners benefit recipients spend a very large proportion of their income on zero-rated VAT items (mostly food and children's clothes).

Don't try to make out that private school parents are onto a good thing fiscally. It is a real burden to pay school fees, which most of us do quite sacrificially but happily.

It's how you choose to spend your money. Calling it a burden is a bit precious. And calling everyone who doesn't pay 40 per cent tax a 'benefit recipient' is a. stupid and b. clearly intended to be insulting.

Well the main tax breaks enjoyed by independent schools is a reduction in rates, and for some few wealthy schools there is no tax on investment income. To be honest if the Government had been able to come up with a scheme that stopped these tax breaks yet left the schools keeping their existing trust status then the schools would probably be delighted to do so.

But because the norm for many many decades has been to set up schools as trusts (which tends to provide good forms of oversight), schools are now caught in the trap. There is no simple way to convert from charitable status to non-charitable status. The trust has to sell all of its assets, ie the school buildings, land and all assets to another company (which of course has to find funding to buy them). The trust then has to use the funds it has made from the sale for educational charitable purposes before it can be wound up.

So it is not the tax break that is important. Incidentally education is exempt from VAT across the EU. So in fact schools run as charities suffer a higher VAT burden than they would otherwise do as charities can't recover VAT. Certainly I haven't noticed school fees as being notably cheaper at charitable schools, so the average parent certainly isn't getting a break from sending their children to one.

We are not the ones who are whinging. I am very glad to pay school fees - especially as a teacher who has done time in state schools - nothing makes me more convicted about private schools. It is really quite a joy to pay fees, however sacrificially.

It is those who are worried about the lack of VAT paid to the treasury, even though they haven't done the math.

Ladymuck,

I have seen lots of figures saying that schools would actually be better off if there were no such thing as charitible status.

However, for every school that I know - the one I teach at and the one that DSs go to, and a few others - this would be totally against the ethos of the schools.

It would be unthinkable for our school to be 'uncharitible' regardless of government hangups - they can punish us if they like, and it won't change our values.

Talking about burdens and sacrifices does sound a bit like whining, actually. And I notice you haven't retracted that attack on benefit recipients.

I guess one of the advantages of having children in state schools is not having to deal with pushy people who think bank balance is a signifier of moral value.

I don't think that the changing the status of a school from "charitable" to "for profit" is quite the same as saying it becomes uncharitable?

To be honest when I looked round local priavte schools I didn't notice that much difference between the for profit and the charitable ones. Other than I guess there are fewer "for profit" ones. Though Chris Woodhead is trying to change that.

Well, Edam, I guess you get your reward in full.

Yeah, I get to have my son educated in an excellent school full of enthusiastic teachers. Works for me.

Well there dear

Still patronising, I see.

yw