Profit-Making State Schools, Why this is a terrible idea (part 2)

In profit warning part I ( http://bit.ly/WCI8ut ) I argued that neoliberal pressure to allow schools to make profits were absolutely nothing to do with raising standards or improving outcomes for students. The motivation behind allowing companies to cream off profits from running state education is purely about profit and the enrichment of the elite who will own the largest stakes in these companies.  If profit making companies are allowed to run schools, then standards will actually drop as they have done in the liberalised markets for energy and rail.  Nor will the tax-payer make any savings, as the government will fund these schools places at least the same level as non profit-making schools, and pressure from neo-liberals may even create the same kind of distortions we are going to see in the NHS as ministers bend over backwards to create favourable conditions for profit making for private enterprise.

Allowing market forces into education will not work for many reasons.  When people talk of market forces and competition, it is interesting to probe what particular markets they are holding up as successful and vibrant examples of the capitalist genre. One such ‘market’ is food retailing and the domain of the supermarkets. It is true that competition to win the ‘weekly shop’ has led to unprecedented choice and value for Britain’s shoppers. The large supermarkets constantly innovate to get us through their doors, and for those resistant to the might of the big chains, many towns offer alternatives such as traditional markets, organic outlets and so on.  As an example of competition and the profit motive driving up standards, it is hard to argue with food retailing, although the bullying tactics of the large supermarkets in squeezing margins out of their suppliers such as dairy farmers do reveal how even this text-book capitalist template has its negative consequences*.

Schools are not supermarkets; education is not food shopping.  If Tesco was a school, you would get to visit the supermarket as prospective customers on an open day and the manager would show you a powerpoint presentation of the facilities, for this is mostly what happens when parents set out to choose schools. If you liked it, you could put your name down and if successful you would then be allowed to shop there for the next 4, 5 or even 6 years. You’d better hope you made the correct choice, as you would only be shopping there and you wouldn’t be able nip along to another school to take account of a special offer, or a juicy 3 for 2 deal.  You could transfer to another supermarket if they had a spare slot for a customer and you could bear doing all of the paperwork.  This is the fabled ‘choice’ held up by Neo-liberals as the consumer pay off for accepting a privatised alternative to a state service. The choice here though is nothing but a chimera; you can’t shop around, split your shop up to get the best value or stop going to a particular store altogether as you can do with your weekly shop. Once the decision is made, you are captive, and captive customers can do nothing to influence the quality of the service they get.

Profit making schools will probably do many things to ensure that they deliver a healthy profit to shareholders and senior management of the parent company. Firstly, as a school’s main budgetary outlay is staffing, particular the cost of teaching staff, they will seek out the lowest paid teachers (those with little experience), and whenever possible employ unqualified teachers on the lowest wages. Michael Gove’s announcement in July 2012 that unqualified teachers can now work in academies and free schools suddenly makes sense, paving the way for a way for profit making chains to commence the profit-seeking race to the bottom.

Profit making schools in Britain may also look to the Charter Schools of America for handy tips on how to boost the bottom line.  Reports on the Noble Network of Charter Schools in Chicago ( http://on.msnbc.com/WWxtrK ) reveal how they see parents as nice little earner on the side, and have created a system of ‘disciplinary charges’ to fine parents of students they believe have broken school rules. Some students have racked up hefty fees for their parents for what seems like trivial infringements.  The potential for abuse here is astonishing.  Schools needing some extra cash can simply mete out detentions to students (whether justified or not), and then soak the parents for ‘administration fees’. The ultimate irony is that a student with a poor disciplinary record is far less likely to be offered a place at another school, so the family is trapped into handing cash over.  Schools will also no doubt be tempted to inflate other costs for parents, the school trip could no longer be a cost-neutral exercise, but have a hidden surcharge to boost the coffers, and the uniform could only be bought from the school, again with added margin to rip off the parents and enrich the schools shareholders.

The blind belief in the power of the markets, despite the overwhelming empirical evidence of failure in energy supply, rail transport and so on is a very real form of coercion through which the state forces people to accept a second-rate service simply to increase the wealth of a narrow elite.  Profits created are either the result of cartels (as with energy), or state funded monopolies (rail, and education if that ever comes to pass) being handed tax payers’ money. Nor does the state itself shrink as most free market advocates would wish, as government still has to fund these services through general taxation and have regulatory oversight to correct the most egregious failings of these quasi-markets create.

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* This was written before widespread contamination of Beef by Horsemeat was discovered in UK and Irish foods. Rather than modify the blog, I merely ask the reader to reflect on how the failure of the supermarket supply chain impacts the arguments made here about the perfectibility of markets.

This blog was originally published on The Backbencher

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