Forest of Dean & Wye Valley

Schools as cash cows?

In R.Richardson on September 7, 2012 at 12:35 pm

You must be joking – right?


RUTH RICHARDSON looks at the flood of private capital into our schools, as companies seek to make profit from the education of our children

In a previous Clarion we reported on those companies that are making big money out of providing services formerly in the public sector. An article in Tribune by Lisa Nandy (Labour MP for Wigan) prompted me to look more closely at the role of private companies in the sphere of education.

At present, “free schools” and academies are not-for-profit establishments. But Michael Gove, in evidence at the Leveson inquiry, gave a clear indication that this might well change, that we could “move to a position where free schools could make profits in a Tory second term”.


Although private companies cannot yet run schools, they do play a large part in the education system. It is particularly in free schools and academies that they find their clients. I was staggered to find that 45 per cent of all secondary schools are, or are about to become, academies. And just this year the academy model has been opened up to primary schools.

The rationale behind the conversion of existing schools into academies was that standards would be improved with an injection of cash and the freedom to buy in expertise. A fair amount of autonomy would be allowed, and links with Local Education Authorities would be broken.

Private firms were quick to spot a money-making opportunity. Firms like MCA Cooper Associates who supply advice pre and post conversion to would-be academies. Or Vision2learn which can supply a range of IT courses at secondary level.


Free schools, too, are a fruitful source of business. Originally free schools, legislation for which was passed only two years ago were intended (allegedly) to give like-minded parents the chance to establish a neighbourhood school independent of the LEA. The reality, however, is that such schools are often sponsored by religious groups and sometimes businesses which it is feared could compromise their integrity.

It’s worth visiting the website of Concentra which has lots of helpful advice for anyone wanting to set up a free school. Concentra will assist in putting together a bid, arranging a survey of suitable premises and drawing up business plans. Another company ready to give advice is GEMS (Global Education Management Systems). Its CEO says, “Running a school is quite complicated and can’t just be handed over to amateurs. We are exploring opportunities right now, supporting groups of parents.”


It’s not only in academies and free schools that private companies are involved. Up and down the country, firms claiming expertise in many varied fields are supplying educational services to LEAs and individual schools. Serco, for example, which runs the Docklands Light Railway and is reported to be a bidder to take over healthcare provision in Gloucestershire, provides services in Bradford and Walsall. The VT Group, a supplier of naval defences, make provision in Surrey and the London Borough of Waltham Forest.

In Sweden profit-making free schools have been in existence for twenty years. But although there appeared initially to be some short term gain in pupil achievement, this was not sustained in post-16 year-olds. There are a number of “for profit” companies running such schools in the USA, where they are known as charter schools. One such company, the Texan Can Group were rated academically unacceptable in nine out of its ten schools – yet its CEO still draws a salary of £236,000.

In England, Cognita, a company that runs the Southbank International School (an independent school) has been accused by parents of turning it into a “money-making machine”. Cognita, incidentally, is run by Chris Woodhead, former chief inspector of schools. Cognita says that it is working with parents on a number of free school projects.


Lisa Nandy, in Tribune, voices what I’m sure most of us feel. Introducing a profit motive into the running of schools is wrong. She writes, “Where children’s interests and profit conflict it is inevitable that the primary responsiblity is to shareholders”.

And Shadow Education Secretary, Stephen Twigg, said recently that every penny available in education should go back into the school system. There is no room here for profiteering.

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