You’ve probably seen quite a lot in the news recently about the Barclay Review and its potential impact on Scotland’s independent sector. A lot of the reporting is quite speculative and not entirely accurate. As a result, we get lots of questions and enquiries about what the implications of the Review actually are, so here’s a quick rundown:
What is the Barclay Review?
Commissioned by the Scottish government in 2017, the Barclay Review (chaired by Kenneth Barclay) was introduced to reform the business rates system in Scotland in order to better support business growth.
One of the recommendations to come out of the report was to remove charitable rates relief from independent schools in Scotland.
A lot of the debate is centred on the question of why independent schools are granted charitable status in the first place. Well,in 2005, the government created the Office of Scotland Charity Register (OSCR) to assess all the organisations that held charitable status in Scotland (including independent schools) and it was decided that independent schools should remain as charities having ensured their public benefit outweighed the private.
But what does this actually mean in practice? Independent schools in Scotland dedicate over £30 million a year towards means tested bursaries. They also share facilities with the local community, as well as working in partnership with local authority schools to share staff expertise and teaching facilities to the benefit of all pupils involved. So, like all other charities in the UK, independent schools do not operate as profit making bodies - money from fees is either invested back into the school (to pay and recruit new staff or to improve facilities) or it goes towards means-tested bursary assistance.
Barclay is not arguing for the removal of independent schools’ charitable status, only that they should no longer be eligible to receive the same financial benefits as every other charitable organisation in Scotland, England and Wales. This is both imbalanced and impractical.
How will this impact independent schools?
The removal of charitable rates relief is estimated to cost the sector £5 million a year. The principal way schools can realistically accommodate a potential six figure spending increase per year is to increase their school fees, something all of our independent schools try desperately hard not to do.
Many schools may also be forced to limit the sharing of their facilities or begin charging fees at commercial rates for the use of their resources. With Scotland experiencing a shortage of teachers, it may also have an impact on the recruitment and retention of teaching staff.
What can we do?
It is important to note that the removal of rates relief is currently just a recommendation as a result of the Barclay Review and is not yet the law, but it is clear that the potential implications present a challenge.
That’s why SCIS strongly opposes the implementation of the Review and will continue to support independent schools and rally for these changes to be rejected. SCIS advice is for the government to leave charitable organisations alone (subject to OSCR) and instead focus their time on removing the notional rates bill for state schools so that all education institutions operate the same – with the same rates relief.
In the meantime, there is an ongoing government consultation on the execution of the Review, which gives schools the opportunity to show what the impact of the removal of rates relief will have on their pupils, teachers, parents and their community and SCIS encourages all schools to get involved with this.
Currently educating more than 30,000 pupils in Scotland and employing around 7,000 teaching and support staff, despite the challenges thrown at it, the independent sector in Scotland is a strong and robust one. SCIS will not let these recommendations, whatever their motivation, take away from the hard work and dedication that everyone involved in independent education in Scotland shows every single day. That is why SCIS is incredibly proud to be representing the sector.
For more information on the Barclay Review, please contact us and we would be delighted to answer any questions you may have.