The arithmetic of Free schools


                 The opponents of Free schools are complaining that the government has allocated £50 million of capital to such schools. They are seeking to suggest that the government will end up spending much more than £50 million. Is this true, and does it matter?

                  The government has ruled out allowing for profit companies to set up and run Free schools. They have not followed the Swedish model, where for profit companies play a big part. This does mean that UK Free schools are likely to need capital support from taxpayers, as well as all revenue costs being paid for out of the education budget. Fully privatised schools could absorb the capital costs financed from private sources, whilst still delivering free places to state financed pupils. Free schools in the UK are not a privatised model.

                   There are four kinds of capital spending possible to create and sustain a free school. The first is the school could buy an old school or other suitable property from the public sector. If the government gives it a grant to do this there need  be  no increase in total public spending, as the money is used to reward the public sector vendor. In a normal case a local education authority receives money from the free school, so the cash impact on the public sector is neutral.

                  The second is a Free school could buy a suitable property from the private sector. If the government gives it the money to do so, there will be an increase in public spending. If the Free school is to provide places that the state sector would oltherwise have to supply by building a new school or expanding an old one, then there is no increase to total spending, but a redistribution of it. If the Free school provides extra places to offer more choice in the local area, then there is an increase to public spending.

                        The third is the Free school could spend capital on refurbishment or improvement of an exisiting property. This is also an increase in public spending, but it might be a replacement project for such improvement by an LEA school.

                       The fourth is a Free school might build a new building. This is also an increase in public spending, but it too could be a replacement project for a similar project in theLEA sector where extra places are needed.

                       Critics should think a little more before sounding off. If Free schools provide better value in the construction, refurbishment and provision of school buildings, then taxpayers overall will benefit. If Free schools merely provide some places that would otherwise be provided by LEA schools, there should be no increase in spending, and maybe a saving from doing it in a less bureaucratic way. If the idea is to increase the number of surplus places to provide more choice, then there could  be some increment to public sector capital costs, in the interests of offering more choice.

            On Monday when this issue was first raised on the Today programme no Minister was available to deal with the criticisms. Ministers will have to learn that the way to push through their reforms is to be diligent in explaining and persuading at every opportunity.


  1. norman
    February 8, 2011

    Hopefully the Conservatives will win the next election and have the confidence to make the case to allow for profit bodies to run these schools but this is definitely a vote winning policy as everyone can see the shambles Labour made of education.

    But that’s not saying much , they seem to have the reverse midas touch, everything they turn their attention to turns to ….

    1. lifelogic
      February 8, 2011

      I will be very surprised if the conservatives win the next election on their present performance. Preventing a strong recovery with their almost total failure to cut expenditure, regulations and the rest.

      1. BobE
        February 8, 2011

        I agree, especially as the Lib Dem support will virtually vanish as the younger generation desert them. If they switch to labour then it looks like a labour win.
        I will continue to stay switched from Con to UKIP. UKIP is the only tiny hope to change anything now.
        Region 6, EUSSR

      2. lifelogic
        February 8, 2011

        And now they seem to want the banks to leave too just for a very short term political gain. Bad tax badly executed.

        There is no election now please just concentrate on the one in 2014/15 and get the recovery going now please.

  2. stred
    February 8, 2011

    However additional school buildings are provided and whether ‘free’ or not the method of resourcing should be changed.

    Under Brown/Balls government, LAs asked for bids from large contractors who employed architects to produce impressive but expensive designs, often much better than the dreadful stuff which came out of LA architects departments in the 60s and 70s. However this method of procurement is more profitable for contractors, as it allows them to avoid competing like for like on a tight specification and with clients quantity surveyor contraining claims for variations.

    To add PFI ‘hire purchase’ to the game was a contractors dream. Clearly the government managers were no match for the contractors accountants. And all that lovely exclusive maintainance on buildings which were designed to impress but are already showing pattern stainingon their gleaming white render with poor detailing. No wonder the idea has become a taxpayer’s nightmare.

    So, what is the latest idea from HMG? Believe it or not, they are going back to the contractors again for standardised cheaper solutions. Each large contractor will be working on simplified standard rectangular plan schools without large glass covered atria, which of course will be cheaper. Any architect or QS could have told them this is cheaper. But the contractors will still be in the same position of avoiding competitive tenders for like for like on a tight specification and measurement.

    Has anyone in government thought about going back to the old method of competitive tenders on an agreed design and which doe not change halfway through. This would save even more. Perhaps the feeling is that if this were to be done, the buidings would be as bad as some of those put up in the past. But this need not be the case.

    It would still be possible to have a design competition with a choice of solutions but NOT CONTRACTOR lead. Architects, engineers and quantity surveyors could be asked to form teams to put up competitive designs, all properly costed for initial build and future maintainance. They would be queueing up to compete. When selected, they could then contain contractors claims and build for less than any package deal. Of course, he big boys in the construction industry would recoil at this idea and be straight on the phone to the Lobbyliars.

  3. Brian Curnow
    February 8, 2011

    Posted on Twitter

  4. Richard
    February 8, 2011

    Its always been a mystery to me why the better schools in my area have never been allowed to expand by their LEA masters who say there are sufficient total places for all.
    They ignore the fact that some local schools are massively over subscribed each year whilst others have pupils sent unwillingly to them.
    It must be nice to run a business where despite performing badly each year you have a full compliment of customers.
    Sadly it would seem that decades after I went to Senior school the same local schools are regarded as good and bad by parents.
    I like the idea of Free schools in that they will be free from the dead hand of Council and LEA control.
    Free Schools must be a good idea because you can already see a huge campaign against them by the organised Left and assorted vested interest groups.
    The greater the opposition is from these people then the more you can tell you are on the right lines.
    Can we also have education vouchers for parents to take and spend at the school of their choice and an end to the perverse nonsense that is the catchment system and allow schools to set their own pay levels and entrance criteria.

  5. lifelogic
    February 8, 2011

    How free will these schools actually be. Will they still have to teach a left wing agenda with any phrases such as “jungle drums” banned (and leading up to GCSE exams with such tricky and ambiguous questions as:

    Which is better for you battered sausage or grilled fish? and
    Do you sweat through your a. kidney b. liver c. skin or d. lungs?

    I assume they want the answer “it depends” for the first and c and d for the latter but their is only room for one answer?

  6. alan jutson
    February 8, 2011

    Life gets very complicated.

    John. Please tell me why so many state schools appear to be failing, and we have to introduce any of this at all.

    Is it simply choice for choices sake, or have we given up on trying to run State schools properly.

    Sorry to harp back to years gone past, but 50 years ago (when I was at school, a very basic secondary modern at that) life seemed so much more simple. we had streamed Secondary schools for the less able. Grammar, schools for the more able, some of whom hoped to go to University.

    Polytechnical colleges existed for those who did not make it to University, for late developers, or for those who thought further education would be an advantage in life/business/work.

    Yes we also had Faith schools, and Public schools for those who could afford it.

    Failing schools did not seem to exist in anything like the number (we are told) do today, perhaps because the Head ruled those schools with a passion, and discipline was perhaps harsh, fair, but it worked.

    Parents teachers associations did not exist to raise money for books or equipment like they seem to have to today.

    Schools were (and still are today) by and large successful because of the quality of the Head, and of course the teachers they employed, not because of the buildings they occupied.

    Staff did not have days off for constant training, the school had assembly in the mornings where the Head would inform all of the school (pupils and all staff attended) of any details, programmes, activities of which they should be aware, team captains gave a report on the school teams performance against other schools in football, rugby, cricket, atheletics etc. All of this engendered a spirit of belonging.

    Over the last 50 years we seem to have lost most of the good parts, and created a confused nightmare of statistics in return, and for what, are our pupils more educated now than 50 years ago ?

    Will they be in the future.


    Interesting talking to a visiting Lion (Worldwide charitable organisation) a couple of weeks ago about the situation in India. The Lions organisation run some schools themselves over there, which are highly prized, the local school in this mans area which he attended started in an old barn some 30 years ago (still the same building, but now modified) they run as private schools were pupils pay £7.00 per month to attend, standards are high and are based on the traditional English Education system that we left behind in years past.

    Most pupils at this school go on to University and qualify as doctors, engineers, Chemists, Lawyers and the like.
    From my questioning, none seemed to do media studies, drama, art, or any other like subject. I was informed that they may develop such interests later, but the whole point of education was to prepare them for the modern business world so that they could earn a living.

    What a contrast !

    1. alan jutson
      February 8, 2011

      Oh !

      Almost forgot, class size typically 40 -45 pupils to one teacher in the Indian school mentioned !

      1. lifelogic
        February 8, 2011

        Yes 44 in my primary school class too in England years ago never a problem really!

        1. APL
          February 8, 2011

          Lifelogic: “Yes 44 in my primary school class too in England years ago never a problem really!”

          The problem with large class size is nothing other than lack of dicipline! This has contributed to ever more raucous classes ever since.

          1. lifelogic
            February 8, 2011

            Because teacher’s are no longer allowed to discipline and as a direct parallel in business managers are no longer allowed to manage staff either due to the absurd net of employment laws (recently made far worse by the so called “tory” liberal coalition).

          2. alan jutson
            February 8, 2011

            42 in mine.

    2. BobE
      February 8, 2011

      At a school open day I discovered that mine were doing “Bus usage in Oxford”. This was Geography!. I complained and was told that it was a compulsorary topic. I asked if they could do plate tectonics rather than left wing propaganda in future.
      Region 6

      1. lifelogic
        February 8, 2011

        Interestingly bus occupancy over the day on many routes, depot to depot, can often be as low as 6 (for a large road blocking bus stopping and starting every few yards). Often far worse on economy than an efficient car which may have 7 seats now anyway and takes a direct route. The bus also needs a professional driver with his energy use too to add in.

        But I don’t suppose they do that bit of analysis at school.

        Buses, trains, bikes, polar bears, equality and trees always good – cars, fossil fuel, nuclear power always bad simple as that for our great leaders.

  7. Electro-Kevin
    February 8, 2011

    You’re tinkering around the edges again and avoiding all the core issues you pledged (and were elected) to tackle directly.

  8. Brian Tomkinson
    February 8, 2011

    Another example of this government’s abject failure to explain and defend policy.
    Most of the vociferous opponents to this can see no further than the LEAs running (should that be ruining?) our schools. These people will argue, on this and other issues where they are wedded to state control, that the government is doing this for ideological reasons, whilst ignoring the fact that their own opposition is based on nothing else. Surely there is someone in this government who can answer this cant?

  9. English Pensioner
    February 8, 2011

    I simply can’t understand why we must have this “not for profit” doctrine for schools, hospitals and similar activities. Doesn’t everyone who works there make a personal profit by being paid?
    As far as we are concerned, if next year a school gives our grandson a good education, neither his parents or his grandparents care whether someone is making a profit out of it or not. (The private nursery he attends at the moment certainly does and it is setting very high standards which I hope will be emulated by the council).
    Assuming that it costs the local council £x to provide a school place for a year, if a private organisation can provide the same or better education for the same price or less, none of us would have any objections; if the private organisation manages to make a profit, whilst still only charging £x per child, so much the better
    And whilst we are on the “not for profit” theme, why did Labour still allow private pharmacies such as Boots and Lloyds to continue and make a profit from the NHS? Logically according to their doctrine they should have all been taken over by the NHS!

    1. norman
      February 8, 2011

      Agree 100%. My infant son is also going to a private for-profit nursery (the most sought after one in town, luckily knew the owner so used my sharp middle class elbows to get to the top of waiting list) and it is excellent.

      It’s another example of the Party leadership conceding the argument to the left and then fighting on their ground rather than standing for conservative principles in the daft plan to decontaminate the brand.

    2. BobE
      February 8, 2011

      Look at the profits being taken by the Gas industry. It nearly all goes offshore. Imagine if we in the UK ran our own Gas supply. Those profits would stay in the UK. Globalisation is insanity.
      Region 6

  10. StrongholdBarricades
    February 8, 2011

    The much more obvious comparison is how much it would have cost for these “free” schools under the building for schools programme

    £50m seems a cheap option, if these schools are then going to rent those buildings from the DoE

  11. Steves
    February 8, 2011


    We own $512 Billion of US Treasuries.How are we going to get rid of this c..p?

  12. Javelin
    February 8, 2011

    I read yesterday there was a huge difference in the payback (up to eight times) between funding in the best and worst schools. What make a school better is putting pupils with the same ability and sex in the same classroom. Then removing costly social engineering agendas. Worrying about a few percentages here and there don’t really matter.

  13. Acorn
    February 8, 2011

    Frankly JR, this is a lot of fuss about very little. It reminds me of a local council budget meeting, where councillors will argue politically for hours about less than one percent of the budget. The other 99% will be spent by government diktat; and, will be far too complex for the councillors to understand never mind challenge.

    The DCFS will have a “total departmental spend” of circa £71,000,000,000 this year, to cater for 10,000,000 school kids. About £7,200 for each pupil. The £50,000,000 for “free schools”; will disappear in the decimal points of the department’s current £6,600,000,000 capital spend. (2010 DCFS Resource Accounts)

    1. eddyh
      February 8, 2011

      The simple answer is to give the parents £7200, or whatever the per capita amount of the total spend on education is, and allow them to select whatever school they wish for their children. Market forces would see to it that successful schools expanded, or more would be started. The poor ones would go to the wall.

      1. Richard
        February 8, 2011

        Absolutely agree with you, this should have been done decades ago

      2. Mike Stallard
        February 8, 2011

        No. “voucher” is smelly. It is a bad word.
        It worked like a charm in Sweden, of course.
        But “it will never work here.”
        And please do not ask why.

  14. Alex
    February 8, 2011

    “If Free schools provide better value in the construction, refurbishment and provision of school buildings, then taxpayers overall will benefit. If Free schools merely provide some places that would otherwise be provided by LEA schools, there should be no increase in spending, and maybe a saving from doing it in a less bureaucratic way. If the idea is to increase the number of surplus places to provide more choice, then there could be some increment to public sector capital costs, in the interests of offering more choice.”


    Which of these situations applies? Does someone in the government know? Is there faith that somehow one or other of these financially positive outcomes will apply? Is it government policy to refuse a Free School application if none do apply? Unless the financial details are made clear it won’t be possible to assess the financial impact of the policy.

    It would be the work of a few moments to posit a variety of sets of circumstances where the financial impact may be negative. Doesn’t the debate need to move beyond speculation?

  15. Alte Fritz
    February 8, 2011

    School reform, in essence, appears mostly to try to recapture what was lost thirty or more years ago. Other contributors comment on the apparent simplicity of schools then. My grammar school in the ’60s with getting on for 800 pupils seemed to run on two, or maybe one and a half, administrative staff. I wonder what it would be now? And, by the way, the education was really quite good.

    One is now conscious that there are vested interests in all public services whose interests are paramount. In education, does one ever hear a teacher say that the system is failing? If they do, then look at the fate of the poor girl championed by Archbishop Cranmer. Watch Andrew Neil’s recent Posh and Posher televison progamme which packed punches but he may as well have been punching into thin air.

    Meanwhile, our local news broadcast featured cuts in Blackburn. The council leader told the reporter that Blackburn had three significant employers, all public sector. She would probably not have it any other way.

    1. backofanenvelope
      February 8, 2011

      When I finished full time education in 1954 I had attended primary & secondary modern schools and a college for further education. In my district there was a grammar school and a technical school. I left school at 17 and then went to night school. The whole system was full of opportunities. It could have been improved by providing more capacity for the grammar and technical schools.

      Instead we got comprehensive schools. And have spent the last 50 years trying to get back to the previous state of affairs.

  16. JimF
    February 8, 2011

    This sounds like something from the Department of Can’t See the Wood for The Trees, which is a strand running through Government policy these days. It is dealing with the minutae on a grander scale than the argument for the core principle or policy itself.

    The real issue is how do we get from a class of 5 year olds with variable potential in many different aspects of life to a group of 18-23 year olds who are equipped with the best education and training corresponding to their ability? The more important variables must be teacher ability/motivation, domestic environment, academic environment, disciplinary environment, access to tools of learning, and so on.

    Whether or not a school is “Free”, new-built, refurbished or whatever is of little or no consequence in the big picture.

    1. Mike Stallard
      February 8, 2011

      Comrade, I am disappointed here.
      What about the issues? What about the Montessori method? What about equality of outcome? What about fighting racism, sexism and credal conformance? You did not, dear comrade, mention G&T, EASL, ESN, Medicality what were on the admision.

  17. Denis Cooper
    February 8, 2011

    I don’t entirely agree with this because the practicality is that many of the existing schools, especially secondary schools, not only have serviceable buildings but occupy large sites within built up areas of towns.

    In many cases, therefore, a new school with decent playing fields would not only require completely new buildings but would also have to be located on a new site outside the town.

    In parallel, because of its falling rolls one of the existing schools would be shut down, its buildings would be demolished before the end of their life and inevitably the site would be sold off for housing.

    Later, it would be found that children who previously could have walked to a nearby school will instead have to be ferried to an out of town school.

    It would seem cheaper and better in many other ways to simply replace the head teacher of an existing school which is deemed to be failing, and bring in a new head teacher who could bring it up to scratch.

  18. Mike Stallard
    February 8, 2011

    Oh Dear. I am one of the people who is trying (desperately) to set up a new school here in Wisbech.
    Here are some points:
    1. The local Comprehensive is failing again. Nobody local argues this, even the Comprehensive Headmistress, an excellent, caring professional.
    2. We are trying to get through a wall of bureaucracy which has sprung up like lions’ teeth in the last 12 months. To get through to the DfE you need a passport called a “Proposal” with all the right Keywords. Of course, the Proposal wording is currently undergoing alteration which means that our last effort (it took a professional teacher, who has four children of her own to look after, a week to compose) is now totally useless. The next one will be vouchsafed “within the next few weeks”.
    3. To get accepted you need a Proposer who will stand in the place of the County Council. This is to rule out (unsuitable proposals-ed). Our strenuous efforts have resulted in getting the very best of these Proposers quite interested, but not yet committed. Believe me, none of these people are “Tory (disparaging word)” riding around in Rollers and wearing crisp Italian suits like the Tony Blair labourocracy used to in the olden days. They are all of them in it because they are fighting a crusade to bring decent schools to ordinary people. And they are nice with it too. And they have an outstanding track record. But, again, the bureaucracy is standing in the way, unable to make up its mind in case it gets into trouble.
    4. Buildings are not of the essence. Fighting the bureaucracy is. We can get a school going anywhere if we are just allowed to get on with it. Google started in a garage, didn’t it? But, hey, there were “none of our (whose exactly?) young people” involved. The local bureaucracy’s eyes light up when the word “school building” is said……….Michael Gove promised to deal with this – I was in the room when he said it. But – hey – that was a year ago.

    A personal view of English education (I am a trained teacher with a lot of experience, who still teaches privately and so sees the system from underneath) is that if you let the Head and the Teachers alone and expect the very best form everyone, you quite often (not always) get it.
    Please, politicians, just step modestly back, withdraw your bureaucrats and let us get on without prejudice! Take a few bold decisions for heaven’s sake and stop being wimps! that is exactly what was promised in a meeting in London last March. It is NOT BEING DELIVERED.

    Pretty please!

    1. Denis Cooper
      February 8, 2011

      I’d be interested if you could enlarge upon your first point:

      “1. The local Comprehensive is failing again. Nobody local argues this, even the Comprehensive Headmistress, an excellent, caring professional.”

      In what ways is the school failing, and what are the causes of the failure?

      From what you say the Headmistress is OK, so what’s going wrong?

  19. Mark
    February 9, 2011

    It is interesting to contrast the arithmetic of Free Schools with the Building Schools for the Future project. The BSF project was to be financed in the main via PFI at effective loan rates that are enormous. The designs to be built were untested, but assumed to be beneficial, “enhancing” educational attainment. Now we have the spectre of Christ the King school in Huyton closing after just two years, because the design was found not to be conducive to good schooling to the extent that parents refused to enrol their children there. If the school had been conventionally financed, that would have been £24m to write off: as it is, the PFI bill, suggested by the Liverpool Echo to be some £157m will have to be written off instead.

    This centralised design principle based on unproven educational theories was due to be rolled out across the entire building programme, which aimed to replace every school in the country in little more than a decade. Imagine the cost of having to write off the entire programme had it been allowed to proceed – and add in the PFI premium. Evidence continues to mount that BSF schools produce worse results than the school attained before rebuilding. Also consider how much money would have been wasted by replacing perfectly functional buildings long before their useful lives had expired.

  20. Andrew Smith
    February 9, 2011

    The left, especially the ones in the press and media, like to demonise any new structure which they can label as “privatised”. Given the variations available we need a new language to describe the different arrangements for what we now know as “public sectices.

    I would identify them as:

    tax funded and state run/provided
    tax funded but quango run/provided
    tax funded but outsourced by state agencies
    tax funded but independently run within service level agreements
    privately sourced but state supported by vouchers

    Clearly these are too bulky to use as terms in any debate, but a useful set of abbreviations would be useful. At least we need an agreement as to which level becomes a market efficient idea.

  21. Bazman
    February 9, 2011

    If you can’t afford to send your children to Eaton then Don’t have children. I wonder how many people who support this scheme support toll roads which is probably the way forward for roads? The same people who think the BBC is bias but when they read the Daily Mail take it is pure truth. You just know where a scheme like this is going. I don’t have to prove it except to myself. What benefits has much of the past privatisations like the utilities had for the large majority of the population?
    This is just a scam for middle class and rich parents to set up schools using tax payer money under a smoke screen.

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