Private schools are a con (2): their charitable status

Harrow School - registered charity

Harrow School – registered charity

Reflecting on the charitable status of independent schools, Archie Bland writes that:

Private schools, it always surprises me to remember, are charities. They are therefore subsidised by taxpayers to the tune of more than £100m a year.

In itself, this is counter-intuitive, but perhaps justifiable. Education is always a laudable aim, and if private schools are making serious efforts to ensure that the beneficiaries of their mission are not just the very wealthy, they may have a case. The most obvious way for them to prove it, of course, is by trying to make sure that their fees aren’t a barrier for entry to children who would benefit from what they have to offer. And the most intuitive way they can do this is by finding ways to help them with the fees.

In 2006, the Labour government seemed to take a significant step towards ensuring this, when the Charities Act did away with the presumption that the provision of education was an automatic public benefit – that is, it forced schools to justify their charitable status, instead of simply continuing to say that the mission to spare the progeny of aristocrats the indignities of the state sector was valuable to us all. But it left the test of public benefit to the Charity Commission.

After losing a gruelling legal battle to the Independent Schools Council, last week it issued new guidance that made the idea of private schools having to pass any serious test to justify their status a complete joke. Under the new rules, the Charity Commission will not be able to exert any pressure on schools over how to provide a public benefit to ordinary people. Instead, that will be left up to the governors of the school in question. And that means that you can expect a lot fewer subsidised places. Instead, they will be able to get away with nothing more substantial than the occasional Latin masterclass. The absurdity of the situation was perhaps summarised most neatly by a phrase from the tribunal judgment that led to that new guidance: A school’s status as a charity, the tribunal said, “depends on what it was established to do, not what it does.”

Quite how that definition is enough to justify the term “charity”, and all of the benefits that come with it, is quite beyond me. If I give a few quid to Oxfam every month, and volunteer for the Samaritans, the government doesn’t let me dodge my taxes. But that’s what’s happening here: a few minor charitable acts, and a supposedly charitable purpose, are being allowed as a justification for terming the whole enterprise a charity, even though the vast majority of the work being done is for the benefit of an ever-more exclusive minority – and even though there are strong arguments to be made that private education is an actively bad thing.

Having read the 2011 judgement – which is not online in a free version but is summarised here – I have to agree. They conclude that all that they cannot make independent schools provide any for non-fee paying students apart saying it must be ‘more than trivial.’ Even the suggestion that provision should need to be ‘reasonable’ was rejected. And to cap it all those who received bursaries and scholarship did not have to be in any meaningful sense deprived – anyone unable to afford fees of up to £40,000 could potentially count.

Now I am not suggesting that the judges made a mistake. They were acting within the confines of the law as it stands and to have gone further would have been judicial law making. However, politicians can and should change the law.

Fiona Miller suggests the form such changes could take:

require more exacting eligibility criteria for bursaries (I favour focusing them on those pupils most at risk of exclusion); partnerships that make a quantifiable impact on the performance of local state schools and their most needy, rather than most able, pupils; and more rigorous methods of measuring that impact.

The private charity schools will say this is a costly distraction from their core job of educating an elite very well. Some of their parents, many of whom are powerful voices in society, will object to their fees being diverted into “legs up” to schools they have rejected for their own children. But charitable status is a right to be earned, not a privilege. Until the private sector can make a better case for the public benefit it provides, it should do more than simply exist.

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