What do independent schools contribute to the British economy?

Posted on: 02 Apr 2014

By Matthew Burgess, General Secretary of the Independent Schools Council.

Today we are releasing a report which challenges people to think differently about independent schools.

We know from decades of opinion polling that a majority of parents aspire to an independent education for their children, recognising the strengths and values they offer. We know that many would agree with Niall Ferguson, who recently described independent schools as "the best institutions in the British Isles today".

But what our report reveals, for the first time, is the scale of the contribution made by independent schools and their pupils to the British economy.

Did you know, for example, that the schools represented by ISC (which account for some eight of out ten independently-educated pupils) are responsible for tax payments to HM Treasury amounting to £3.6 billion each year? That every two pupils in an ISC school support one job in Britain? That the savings to the taxpayer of not educating ISC pupils in state schools is equivalent to building more than 450 free schools – every year?

Using standard economic impact assessment modelling, Oxford Economics shows that the total contribution made by ISC schools to the British economy each year is just shy of £10 billion. To put that in context, it is larger than the City of Liverpool's economy. And a greater contribution to GDP than that represented by the other fine British institution, the BBC (recently valued at £8.3 billion).

The findings on savings to the taxpayer are not overly surprising. It is well recognised that parents opting out of the state sector have already paid for a state school place, which government ministers recently estimated to cost £6,350 annually. Oxford Economics have calculated a slightly higher figure - around £6,500 - but even that is subject to some conservative assumptions. But it doesn't particularly matter that the £3 billion annual saving is a low estimate - the number is large enough to challenge the demagogues who would have you believe that independent schools are a drain on national resources.

Oxford Economics also calculates the value of the contribution to the British economy of the high academic attainment of ISC pupils. Again, the success of independent schools in academic league tables is well known, as is the disproportionate percentage of top grades achieved by our hard working pupils. Using OECD data and World Bank models, Oxford Economics puts an annual value of £1 billion on the additional contribution to the British economy of these grades.

As Professor Michael Sterling, former Vice Chancellor of the University of Birmingham and Chairman of the Russell Group, says, “it has long been the case that the independent schools’ sector delivers proportionately more students with better STEM related A levels than the state sector. Without those well qualified applicants many university STEM courses would face serious recruitment difficulties, with a consequential fall in STEM graduate output. As an engineer myself, I am acutely aware of the shortage of STEM graduates for our economy.”

What readers of the report might find most interesting, however, are the numerous case studies illustrating the depth and scale of the contribution made by individual schools across Britain, not just to their local economies but to local children, schools and communities. The festivals, from Portsmouth to Hereford, which would not happen without local independent school support. The specialist teaching staff seconded to local schools from Highgate to Bolton to support pupils taking science GCSEs and A levels. The academies and free schools supported by networks of independent schools, from Newham to Newcastle.

So read the report. And talk to your local independent school about what they do for the local community. Their answer might just surprise you.

Matthew Burgess ISC General Secretary


About Matthew Burgess

Independent Schools Council - General Secretary