DCH 9 Independent Schools Council
Independent Schools Council
Grosvenor Gardens House
35-37 Grosvenor Gardens
London
SW1W 0BS
Tel: 0207 798 1590
Fax: 0207 798 1591
JOINT COMMITTEE ON THE
DRAFT CHARITIES BILL
Evidence from the Independent
Schools Council
(1) The Independent Schools Council
(ISC) represents the seven leading independent schools associations
in the United Kingdom, collectively educating 508,000 children
in 1,278 schools.
(2) 83% of ISC schools (1,061
schools in total) are charities, including all but three schools
in membership of HMC (Headmasters' and Headmistresses' Conference),
GSA (Girls Schools' Association) and SHMIS (Society of Headmasters
and Headmistresses of Independent Schools). 90% of pupils in ISC
schools (456,000 out of 508,000) are in schools which are charities.
(3) ISC schools see themselves
as part of the overall provision of education in the United Kingdom.
As a matter of policy and practice, ISC is firmly committed to
developing partnerships between the maintained and independent
sectors, and to delivering benefits to the maintained sector,
to local communities, and to the wider public.
(4) ISC welcomes the draft Charities
Bill and its mission to provide clarity and stability for all
charitable sectors. There is a long-standing tradition of ISC
schools benefiting the community as well as their own pupils,
and ISC is committed to fostering that tradition in partnership
with schools and with the Charity Commission.
(5) Public attention tends to
be focused on the very few 'household name' schools which, because
of their history, have substantial endowments. It is important
to realise that the majority of ISC schools have little or nothing
in the way of endowments, and are dependent for most of their
income on fees. They are small undertakings: more than half of
all ISC schools have an annual turnover of £3 million or
less. Even the largest schools are, by normal business standards,
no more than medium-sized enterprises. As charities, all surplus
income is applied to charitable purposes.
(6) The evidence in this paper
is sent on behalf of all the ISC Associations and their schools.
In the knowledge that this evidence is being sent, schools and
Associations which would otherwise have submitted evidence are
relying on and support the evidence from ISC.
Evidence
(7) The evidence is concentrated
on the question in the Press Notice issued on 13 May 2004, namely
"Do fee-paying schools which are charities demonstrate adequate
public benefit arising from their activities". The answer
is yes, and overwhelmingly so, for the following reasons:
(8) ISC
schools which are charitable educate 456,000 children, 440,000
from the UK. On the Government's own figures[1], this
saves the public purse £1.98bn each year, and frees this
amount for spending elsewhere in the education sector, including
on maintained schools, on pre-school provision, and on university
and higher education
(9) The education of 456,000 children
is in itself a public good
(10) ISC schools add educational
resources, both in quantity and in diversity, which would otherwise
not exist
(11) The fiscal benefits of charitable
status to ISC schools are estimated at £88 million. The £1.98bn
saving to the public purse from the existence of these schools
is 22.5 times the value of the fiscal benefits of charitable status
(12) Access to the education provided
by ISC schools is extended, through means-tested bursaries and
scholarships, to children whose parents would not otherwise be
able to pay the fees. 31.5% of children at ISC schools receive
help with their fees: 23% of them from the school itself
(13) Many ISC schools actively
raise funds to increase their ability to educate children from
less well-off families, and charitable status helps them do this.
ISC schools give £2.30 in assistance, more than half of it
through means-tested benefits, for every £1 gained through
charitable status
(14) The excellence of the education
in ISC schools, at many different levels of ability, is in itself
a public good. The OECD Programme for International Student Assessment
(PISA) report in 2001 compared combined reading literacy scores
in 27 countries. UK independent school pupils achieved the best
results in the survey by a wide margin[2]
(15) Because ISC schools are acknowledged
as world leaders in education they contribute hundreds of millions
of pounds to the UK balance of payments - £283m in 2003[3]
- by bringing in fees from abroad. They also enhance the image
of the UK worldwide, and enhance international understanding by
educating children from many different countries
(16) 12% of children in ISC schools
have special educational needs[4] including dyslexia,
dyspraxia, and special needs as gifted children. Providing for
these needs is in itself a public good
(17) ISC schools include specialist
schools for children who are deaf, or blind, or who have exceptional
musical gifts or performing talents. These schools provide education
which would not otherwise be available
(18) ISC schools offer use of
their facilities - sports facilities, swimming pools, theatres
- to maintained schools and to the local community
(19) ISC schools are engaged in
a range of partnership activities with the maintained sector and
with local communities to extend benefits to them and to the public
at large. The appendix to this evidence gives examples of the
contribution made by ISC schools in Manchester
(20) Partnership activities include
making teaching and learning materials available on the internet;
the provision of teaching in specialist or minority subjects where
provision is lacking in the maintained sector; special tuition
for children from maintained schools who are seeking places at
leading universities; and specialist tuition in music, drama,
and the arts. ISC schools are active in the Independent/State
School Partnerships (ISSP) scheme, and are giving time and expertise
to help set up City Academies
(21) ISC schools use their own
resources to recruit people into the teaching profession and to
induct and train them. They actively assist teachers in achieving
Qualified Teacher Status, which qualifies teachers to move to
the maintained sector. Through the ISC Teacher Induction Programme
ISC inducts more newly-qualified teachers than any other body
in the UK
(22) ISC schools add to diversity
through encouraging and funding research and innovation. The results
of initiatives in ISC schools act to stimulate debate and to raise
standards
(23) ISC schools offer diversity
in the size and character of their schools, which include co-educational
and single-sex schools; faith schools; large schools, small schools;
specialist schools, and boarding provision. This diversity gives
parents a breadth of choice which is not widely available in the
maintained sector. More than half of all girls educated in single-sex
schools in the UK are educated in the independent sector.
Costs and benefits
(24) ISC schools give back directly
£2.30 for each £1 gained by charitable status, and indirectly
benefit the public purse by £22.50 for each £1 gained
by charitable status. These cash benefits are in addition to the
educational benefits provided to the pupils in ISC schools and
to the wider community
(25) Unlike schools in the maintained
sector, independent schools - charitable and non-charitable -
suffer the burden of irrecoverable VAT on buildings, maintenance
and on other costs. The amount of irrecoverable VAT paid by ISC
schools which are charitable is estimated at £170 million
per year. This is almost double the amount of the fiscal benefits
from charitable status
(26) Fee-paying parents of children
at ISC schools, if they live in the UK, have paid through taxation
for the state education of their children. Their choice of an
independent school means that they pay twice to educate their
children
(27) The argument, sometimes raised,
that charitable status is a tax subsidy from the poor to the rich
does not survive examination. Sixteen million UK adults pay no
income tax. The education of their children is, as it should be,
paid for by people who are better-off. It is, though, clear that
they do not subsidise the education of other children[5]
(28) Charitable status widens
access. It enables schools to increase the availability of means-tested
bursaries for children from less well-off families. More particularly,
charitable status encourages schools to launch appeals to fund
means-tested bursaries and encourages potential donors to give
to these appeals. If charitable status were removed, there would
be fewer donations, fewer bursaries, and reduced access to children
from less well-off families
(29) Independent schools which
are charitable deliver enormous public benefit over and above
the very real benefit of educating their pupils. ISC is happy
to work with Government and with the Charity Commission to advance
and facilitate co-operation with the Government, the maintained
sector, and with the wider public.
[1] Chancellor
of the Exchequer, Budget Speech, 17 March 2004; Prime Minister,
Speech to National Association of Head Teachers,
3 May 2004.
[2]
Knowledge and Skills for Life: First Results from PISA 2000, Table
7.13, OECD 2001
[3]
ISC survey of member schools January 1999
[4]
ISC Annual Census 2004
[5]
Institute for Fiscal Studies: A Survey of the UK Tax System, Stuart
Adam and Jonathan Shaw, November 2003.
Definition of public benefit
The other question addressed by this
evidence is whether the phrase 'public benefit' is best left undefined
in the Bill. The answer is yes, for the following reasons:
(30) The Bill as it stands modernises
and clarifies charity law. It removes the presumption of public
benefit, and thereby requires charities, from all sectors, to
demonstrate public benefit. The Charity Commission is given the
regulatory function to determine whether an institution is a charity,
together with the power to do anything necessary to perform its
functions. It therefore has the authority to inquire into the
public benefit provided by charities. This provides a clear mechanism
for monitoring public benefit and, where necessary, for bringing
charities back to their charitable purposes
(31) With that context, a statutory
definition of public benefit is unnecessary. Case law provides
guidance to all charitable sectors on the nature of public benefit.
Case law also provides flexibility: courts can develop the law
in the light of changing circumstances. Existing case law will
be made subject to the removal of the presumption of public benefit.
That single change is all that is needed for public benefit to
be safeguarded for all charitable sectors
(32) A statutory definition of
public benefit would introduce uncertainty for all charities because
any definition would need to be interpreted by the courts. Even
a provision which aimed merely to restate existing law would tend
to have the opposite effect: there is a presumption that statutes
change the law. There would be a compelling argument that any
statutory definition had changed the law, and considerable scope
for argument on the nature and extent of the change. The process
of interpreting a statutory provision would, in all probability,
take a number of years, with charities meanwhile unsure of their
position and expending charitable assets on legal fees
(33) The Bill gives the Charity
Commission clear regulatory objectives and wide powers, including
powers to give advice and guidance; to give specific directions
for the protection of any charity; to direct the application of
charitable assets; to enter premises and to examine accounts.
The Charity Commission will have an important function in developing
law and practice over time. It will be hindered in this function
by a statutory definition of public benefit, because unexpected
"hard cases" will arise which will need litigation.
That will waste time and resources for charities and for the Commission,
and will delay the development of charitable activity.
Jonathan Shephard
General Secretary, Independent
Schools Council
2nd June 2004
APPENDIX: ISC SCHOOLS IN MANCHESTER
This case study looks at five Independent schools
in Manchester, educating nearly 3,900 children. All of them are
ISC schools, and all are charities. In many different ways they
benefit not only their pupils but also the wider community.
Manchester Grammar School (MGS)
MGS is one of the UK's leading academic schools for
boys. Although its fees, at £2,147 a term, are within the
reach of many parents, the aim of MGS is that its education should
be available to pupils regardless of means. In the past seven
years, MGS has raised £10 million for its bursary fund from
sponsors across the political and social spectrum. Out of a total
of 1400 pupils, 231 receive help with their fees from school funds.
Help is means-tested, and the average level of assistance is 80%
of fees. Parents with an income of £31,250 or more do not
qualify for assistance; at £11,300 or below, assistance is
100% of fees.
For many years, MGS has fostered links with local
maintained schools. Currently it gives maths master-classes at
a city academy, and runs an Oxbridge access scheme, helping sixth
formers from maintained schools with tuition and with interview
techniques.
Over 40 young people from disadvantaged schools took
part in a production of Romeo and Juliet directed by MGS's
Director of Drama and staged at the school. As well as making
its expertise, staff, money and facilities available, the school
raised £31,000 in sponsorship money for the production, which
received rave reviews.
In sport, the school's football pitches have been
offered to the Manchester City FC youth team, and the school has
long been a centre of cricket excellence (former England captain
Mike Atherton attended a local primary school before joining MGS).
Its community action programme is a beacon for other schools in
the North-West.
Manchester High School
Manchester High School is high-achieving academic
school for girls, producing some of the best results in the country.
As a day school, its fees, at £2,247 a term, are within the
reach of many parents. To widen access, the school has raised
over £1 million for its bursary fund and now supports nearly
100 girls in the senior school on bursaries, at an annual cost
to the school of £360,000. Other students are helped by external
charitable trusts.
Manchester High School has an extensive record of
partnership activities and co-operation with local schools. Its
link with Medlock, an inner city primary, is now six years old.
Originally supported by Government funding, and then by the Sutton
Trust, the link has been funded by the school and the LEA for
the past four years. Sixth-formers from Manchester High School
learn mentoring skills in order to support underachieving Year
6 pupils from Medlock, both in the primary school and at the High
School, which offers the use of its laboratories and other facilities.
At a second inner city primary school, Claremount, sixth form
girls act as classroom assistants on a weekly basis. A bid for
partnership funding with Altrincham College of Arts has just succeeded:
the £46,000 music project will broaden the musical experience
of girls from the High School and increase the uptake of music
at Altrincham.
William Hulme's Grammar School
This co-educational school is probably the most ethnically
integrated school in the city. 65 per cent of its pupils come
from ethnic minorities, speaking 19 different first languages.
40 per cent of pupils receive assistance with fees from the school
or from other trusts. The diversity of its ethnic mix comes from
the school's wide catchment area: maintained schools with more
restricted catchment areas tend to keep children within their
own ethnic communities. The school's contribution to ethnic cultural
development operates in sensitive areas: for example in persuading
Muslim families to send both their boys and their girls to the
school. Sports facilities, including the swimming pool, are available
to the local community.
Withington High School
This girls' school was placed equal second
in last month's Financial Times Survey of the 1000 best schools
in the country. All bursaries at the school are means-tested,
with 90 out of 540 senior girls receiving help under the school's
own assisted places scheme, and with other pupils supported by
trusts, including the Ogden Trust, the HSBC Education Trust, the
Greater Manchester Educational Trust and the Peter Kershaw Trust.
The school is about to launch a bursary appeal to extend financial
support and expand its outreach programme with local state primary
schools. The Charities Committee, made up of Sixth Formers, organises
regular events involving the whole School in a variety of fund
raising events for charities in the UK and overseas.
Two bids for Government ISSP funding have just succeeded.
One is a music-based project in association with the Northern
Chamber Orchestra, Trinity High School and a number of local state
primary schools. The second is a two-year arts-based project in
association with Whalley Range High School, the Manchester and
Whitworth Art Galleries and local Craftswomen.
There are long-standing links with a local inner-city
primary school - sixth form pupils visit as classroom assistants
and the head of classics runs after-school Latin classes with
Year 5 and 6 pupils.
The school's facilities are regularly used by local
sports, music, and drama groups; and a number of means-tested
bursaries are available for summer holiday courses, all of which
are open to the local community.
Chetham's School of Music
Chetham's is one of England's four specialist music
schools, educating exceptionally gifted young musicians from all
backgrounds. Nearly 90 per cent of its pupils (260 out of 290)
receive assistance with their fees under the Government's Music
and Dance Scheme. The school also gives bursary assistance, mainly
to overseas students, helping to enhance Britain's international
cultural reputation.
Chetham's takes its music out into the community
through a musical outreach programme of workshops and performances
in local schools, and through its own concerts. Chetham's is also
the choir school for Manchester Cathedral. Every two years, Chetham's
undertakes a major community education musical project: the most
recent, featuring an opera written for children in the Terezin
concentration camp, involved over 2,000 local children in workshops,
drama and music projects and performances. The NSPCC is involved
as a sponsor for the forthcoming 2005 project.
| 
