No case for profit-making schools, think-tank finds

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Schools should not be run for profit, a report argues, which found that charities run schools better than businesses.


The case for profit-making schools is based on the idea that introducing competition will drive school improvement.

But the report by the Institute for Public Policy Research, which examines the case for introducing profit-making schools by looking at international evidence, found no conclusive link between allowing businesses to run schools and raising standards.

It concludes that instead policymakers should focus on what international evidence shows works best: strengthening school leadership, improving the quality of teaching, giving schools autonomy, while also holding them to account, and tackling inequalities between children from different class backgrounds.

The claim that one of the main barriers to improving standards was the exclusion of the private sector was not credible, it said.

It said, ‘There is a case for opening the system up to new providers on innovation, rather than competition, grounds. However, there are already plenty of not-for-profit organisations willing to get involved in state education in England. There is no compelling innovation case for letting commercial organisations run schools.’

The report is published amid increasing pressure on the Government to allow for-profit companies to open free schools and take over maintained schools.

Currently, free schools can only be set up by not-for-profit trusts, but right-of-centre think-tanks have recently published papers calling for profit-making schools, the report said.

Meanwhile, education secretary Michael Gove has also said that he does not have an ‘ideological objection’ to businesses running schools, although Nick Clegg has spoken out against any such move.

The report looked at case studies in Chile, Sweden and Philadelphia, Michigan and Florida in the United States.

The report said, ‘In only one case (Philadelphia) do the for-profits significantly outperform the not-for-profits. In the two cases where for-profit schools have been rolled out nationally (Chile and Sweden), the not-for-profits perform better than the for-profits and in a further two cases (Michigan and Florida) ownership structure has no impact on student attainment.’

The report’s author Rick Muir, associate director of the IPPR, said, ‘While there is a role for the private sector, schools themselves should not be run for profit. Given parents’ growing concerns about the wider commercialisation of children’s lives, introducing commercial incentives into the state school system seems particularly perverse.’

‘Schools should be public institutions, situated at the heart of local communities and run in the public interest.’

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