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Conservative Plan to Allow State-Funded For-Profits

After following moves to privatise public education in the United States and the United Kingdom for the past few years, I was not surprised to read of the latest plan from the UK’s Conservative Party. Steve Baker MP is developing a plan that would allow parents to operate free schools and pay themselves dividends with any leftover funds from the annual budget. Currently, free schools are state-funded and operators are not permitted to run them on a for-profit basis.

Remarkably, Baker does not take issue with people earning a profit from public services. He says, “To me, profit is just recognition of the fact that you are serving society, as long as that profit is made fairly without force or deception.” Whilst this might seem reasonable on the surface, the ambiguities in his argument are cause for concern. For-profits benefit from exploiting information asymmetries, and I question whether the public would be able to adequately monitor these schools to ensure that profits are being made fairly once they are out of local authority control.

Mr. Baker seems to believe that the potential to earn a profit could incentivise parents to run schools. However, one needs to consider how a profit motive can distort the educational mission of schools, leading to cut corners or outright fraud. Any “extras” that are not protected by mandates, such as libraries, additional learning resources, or after school programs, could easily be seen as barriers to profit by operators.

Furthermore, for all the emphasis that Baker and his Tory colleagues place on “parents,” it is unclear who, exactly, would be responsible for running these for-profit schools. Whilst groups of parents are allowed to operate free schools, charities and businesses are allowed to do so as well. Although Baker has clearly attempted to downplay the potential role of the private sector by highlighting the role of parents, he also claimed, “(o)ne of the questions we have to answer is how do you incentivise people to set up and run excellent schools for disadvantaged children?” (emphasis added). So it appears that this for-profit experiment will be targeted towards children from disadvantaged backgrounds, rather than all children. Instead of addressing the root causes of poverty and the reasons why some parents struggle to support their children, this plan would open the door for private companies looking to make a profit from the children most in need of support. Sounds familiar.

Although the Telegraph article concluded with doubts as to whether this plan will ever be implemented, it does demonstrate a remarkable misunderstanding of the role of our public schools and the value of education more broadly. Free market education reformers always carefully choose their words to make it appear that their plans are child and community-centred, but it does not take long to find the holes in their arguments. Instead of questioning how to incentivise private individuals to run schools, we need to question why the politicians who have been elected to act in the public interest are shirking their responsibilities.

I think it’s time to write Mr. Baker a letter. Or perhaps send him a copy of every book Diane Ravitch has written.

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