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Who owns your child’s school? The rise and rise of edu-business

Faster than we recognise, schools are becoming profit centres. The buildings, the teaching, the cleaning, the exam results are all ways to make money. But who benefits? Not the poorest, argues Melissa Benn.

Brooke House Sixth Form College in Hackney -  known as BSix -  has come up with an inventive new wheeze to break down the inequalities of access to higher education. It has spent thousands of pounds creating a replica of an Oxford don’s study down to the colours of walls, antique furnishings and polished wooden floors. The so-called Red Room has been built in order to familiarise underprivileged youngsters, who aspire to top universities, with the lush furnishings of privilege.

Age-old assumptions underlie the BSix initiative – namely, the perceived superiority of certain elite institutions, in both the secondary or higher education sector. But recent moves, a mere 30 miles away in Luton, Bedfordshire, more accurately indicate the new direction of our education system.

Here, the Barnfield Federation, a group that already runs a chain of academy schools, has declared an interest in running one or more for-profit further education colleges, taking advantage of a permissive clause in the 2011 Education Act.  Surplus cash generated by the ‘business’ will be used to pay a dividend to shareholders. 

Welcome to the rampant, and rapid, privatisation that now characterises the English education scene. As we move away from state provision of state education, the remnants of a universal comprehensive system are being dismantled and replaced by new providers at every level.

Eton in the East End

To take one small example:  private schools are increasingly encouraged (a process begun under New Labour) to set up, or take over, failing schools, often with mixed results. At the Isle of Sheppey academy, sponsored by Dulwich college, truancy figures were recently reported to be the fifth highest in the UK.

More recently, there has been sharp protest at plans by Eton College and several other leading public schools, to run a super selective sixth form college, entitled the  London Academy of Excellence,  in London’s East End.  According to Eddie Playfair, head of  nearby Newham College:

‘The rhetoric is that this is a lifeboat coming to save the poor. A lot of effort will be wasted in competition which could be spent on improving education and sharing good practice and developing what students really need.’

Professor Stephen Ball of the Institute of Education, a leading authority on the steady march of ‘edu-business’, describes it as a ‘ratchet process’ in which each new government circular or Education Act has opened up a fresh business opportunity.  As Ball told me when I interviewed him for my recent book School Wars: The Battle for Britain’s Education, there have been 35 such moments since 1988, each one encouraging the private sector to take over, and sell back to schools, a range of services, from meals to building improvements, to the examination system and inspection services. Over time, a plethora of bidders has become consolidated into a few, established, providers. The result is that, while during the 1990s there were 120 different companies involved in the inspection of schools, this had shrunk to seven by 2003. It has now dwindled to just three.

As Ball shrewdly observes, the term  ‘privatisation’ does not do justice to the complex interconnection being formed between state and market. We are seeing a general “corporatisation” of schooling itself - covering everything from the importing of private sector management techniques to the dominance of entrepreneurial and aspirational narratives and values within the classroom.

Take Amey, typical of companies operating in the education world. It markets itself as a leading provider of “more effective and efficient public services”. It employs more than 11,000 staff, works in more than 200 locations in the UK, trumpets a range of education related services,  including ten major education partnerships. It boasts of contracts for services ranging from schools improvement and special educational needs to the delivery and management of new schools, encompassing cleaning, catering, janitorial, security and building and grounds maintenance.

Philanthropy

However, the company’s website does not make reference to Amey’s ill-fated sponsorship of one of the early city academies, Unity City Academy in Middlesbrough, North Yorkshire, one of the poorest areas of England, which opened in 2002. By 2008, only 12 per cent of its pupils were getting five good GCSEs and the company eventually withdrew from the school.

Worldwide, the education market is estimated to be worth more than £100 billion. It has increasingly attracted the interest of philanthropic billionaires, such as Bill and Melinda Gates in the United States, and, here in the UK, Arpad Busson, the London-based French financier who founded ARK, one of the more successful educational chains in England.

Education has also attracted the interest of multinational corporations such as Pearsons, owners of the Financial Times and the Penguin Group, and of Rupert Murdoch’s global empire, News International. Pearson Education employs around 37,000 people and is based in more than 60 countries. This company recently bought up educational businesses in Brazil, India and the US. It has contracts with five English academies for textbooks, as well as providing pupil assessments, teacher training and software. Pearson has also expressed interest in the new boom area of English education - helping to run new free schools and academies. 

Since coming to power in 2010, the Coalition has accelerated the break-up of state education, and encouraged a range of semi-private providers to enter the system. Free schools were initially presented by Tory ministers as a form of parent power, but most of the new schools are in fact being run by an eclectic mix of charitable and third-sector organisations, religious groups,  and, increasingly, private providers and the rapidly expanding academy chains.    

Take Oasis, one of the largest academy chains, with 14 academies already open and more in development. As Henry Stewart reports on the Local Schools Network website, between 2006 and 2010, the revenue received from government by the Oasis chain grew from £3 million to £70 million. The revenue of  ARK, which runs 11 academies in London, Birmingham and Portsmouth, increased from £3 million to £117.5 million. In 2009-10,  the income of E-ACT, another academy sponsor, grew from £15.5 million to £60 million. Its head, Sir Bruce Liddington, former Schools Commissioner, was reportedly paid more than £280,000 a year, in the last year when accounts were available. (The finances of these chains are no longer published.) All these groups are highly regarded by government in policy debates and have considerable influence on the development of government thinking and practice in education. The views of local authorities, on the other hand, are largely ignored.

Profit centres

The idea of ‘for profit’ schools is now widely discussed in the media and various policy arenas. In Spring 2011, the Adam Smith Institute proposed the introduction of for-profit free schools, claiming it the only solution to dealing with a rapidly expanding primary age population. In January 2012 Policy Exchange came up with the more emollient sounding  ‘John Lewis’ or social enterprise model, in which key stakeholders share the profits: the origins of the Luton sixth form college proposal mentioned above. 

The economic logic of privatisation is clear: with drastic cuts in public spending, forced on government by the bankers’ crisis in 2008,  putting public services out to market appears to save the tax payer, while enabling shareholders to  earn a share of the profits. What it does not do is ensure equitable provision.

Proponents argue that it is the poor who will ultimately benefit from such changes. Bill Gates told the 2008 World Economic Forum that this was ‘creative capitalism, an approach where governments, businesses, and non-profits work together to stretch the reach of market forces so that more people can make a profit, or gain recognition, doing work that eases the world’s inequities.‘ 

Professor Ball notes wryly of this approach in a forthcoming article in FORUM, (Vol 54, No 1, 2012):  ‘Here, then, profit becomes a force for good, at exactly the same time as it brought the western financial system to the brink of collapse.‘

How these policy developments will promote the interests of poorer children remains questionable.  An independent analysis of 23 of the 24 free schools that opened their doors in September 2011 revealed that these schools had a significantly lower percentage of children on free school meals (a good indication of deprivation) than neighbouring schools. And recent analysis by the Local Schools Network, featured in The Observer and now confirmed by researchers at the House of Commons, has shown that the much-trumpeted sponsored academies do less well in terms of results than the relentlessly traduced community schools serving similarly disadvantaged populations.

Given the relentless drive to privatisation of our schools by the current Coalition government, their poor performance remains a surprisingly well-kept secret.


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