Education notes: Limits of privatisation

The great custard well
The 1944 Education Act set up a Ministry of Education as part of the new welfare state after the Second World War. This Act established local education authorities financed from both national and local taxation. The first and largest of these was the London County Council (later the Greater London Council), and teachers used to joke that under County Hall there was a deep well from which came the custard for school dinners, the paint for school walls and the glue for school work. The point of the joke was that the local authority was the custodian of all the resources necessary to run an education system including school buildings, school transport, acres of land and playing fields. It was also the employer of thousands of teachers, office staff, examiners, dinner ladies, accountants, decorators, caretakers, construction workers and maintenance and cleaning teams. Local education officers organised the bulk purchase of stationery and the provision of school dinners, and oversaw teacher training.

Privatisation makes an entrance
This vast not-for-profit sector catered for 93% of pupils up until the Thatcher/ Baker Education Act of 1985. This Act introduced a national curriculum, a regime of constant testing and, most significantly, a campaign against local government. Thatcher set out to break up what she regarded as a local council monopoly and put its functions up for sale to the private sector under the mantra of ‘value for money’. On coming to power in 1997 the Labour Party enforced ‘outsourcing’ with even greater determination. The measures to centralise the education system were measures to control and discipline both teachers and elected local officials, to undermine them, take away local council ‘monopoly’ and deliver services into the hands of private business.

Ending local council monopoly
Today almost every school service possible has been privatised: school dinners, cleaning, maintenance, professional training, examinations, accounts, stationery, transport, special needs provision, etc. A whole new edu-business has arisen, making big profits for private firms. The latest news from Schools minister Ed Balls is that private companies will run small schools for excluded children, so-called ‘sin bins’ or Pupil Referral Units, and that 12 pilot projects have started. ‘This is the creeping privatisation of education’ said the National Union of Teachers general secretary in October 2008. Creeping? More like a smash-and-grab raid to enrich Labour’s City friends for the last 11 years.

Privatisation is inefficient
Labour says that the free market economy will lead to economic growth and national competitiveness. In fact it is a more expensive and less efficient way of running a state education system than central planning and resourcing. Education businesses are only concerned to make profits, so they supply services as cheaply as they can. The result is failure to deliver on price and on time. This year the US Educational Testing Service (ETS) failed to mark the Key Stage 3 tests properly or on time. Not only did the government have to sack ETS from its £5 million contract but also KS3 tests were suddenly discarded in an Ed Balls announcement to an empty House of Commons. Similarly this term, hundreds of thousands of very poor students had to wait for months for their (very small) education maintenance allowances because the Liberata Company failed to deliver. Liberata apologised saying it had not employed sufficient workers for the contract which it was awarded under the ‘best value for money’ guidance. It too has now been sacked.

Thousands of posts – managers, advisers, consultants, inspectors, improvement gurus of every kind – have been invented and financed by central government, whether by setting up quangos or by awarding contracts to the mushrooming self-employed education businesses. In state schools, infant classes still have 30 children compared to the private sector’s 12, but an army of well-paid literacy and numeracy consultants give advice every day of the week. This is not the free market, this is not entrepreneurship – it is a transfer of public monies from the state to private interests. In the words of the Financial Times, education advisers are ‘employees who formally work for a private company, but are wholly dependent on taxpayers for employment’. Privatisation is a con trick, slicing a top layer of funding off services previously provided and guaranteed by the state.

As the current credit crunch bites, small private schools are closing at the rate of one a week, and wealthy middle class parents are pushing and shoving their children into the best state schools. Now they are in the same position as the vast majority of working class parents who cannot pay for private education. Meanwhile, crisis-ridden banks and companies are becoming increasingly risky partners in the many Public/Private Finance Initiatives launched by this government. There is a threat of unfinished school building projects around the country, as the major building firms face bankruptcy and fail to complete contracts. The state sector which was opened up to competition, to entrepreneurs, to the free market, to enterprise will be grinding to a standstill as the recession deepens. The only real way to finance the education sector will be a return to the spirit of the 1944 Education Act – only this time, a great deal better.

Susan Davidson

FRFI 206 December 2008 / January 2009