Charities (Protection and Social Investment) Bill [HL]

Lord Wallace of Saltaire Excerpts

Monday 20th July 2015 Lords Chamber

Moved by

[Lord Wallace of Saltaire]

19: After Clause 12, insert the following new Clause—
“Independent schools’ facilities: public benefit
In section 4 of the Charities Act 2011 (the public benefit requirement), after subsection (4) insert—“(5) Independent schools which are charities must engage actively with local communities and state schools with a view to sharing resources and facilities.
(6) The Charity Commission must publish guidance setting out the minimum that independent schools which are charities must do to comply with the duty in subsection (5).””

[Lord Wallace of Saltaire (LD)]

My Lords, we return to a simplified version of amendments which the noble Lord, Lord Moynihan, and I moved in Committee. Between the two stages there have been a number of discussions with the Minister, for which I thank him, and with the Independent Schools Council along with others. I must apologise to some of those with whom I was attempting to negotiate for much of Thursday and Friday morning, in that I happened to choose one of the few places in Oxfordshire where you cannot get mobile phone reception.

The context is clear: the rise in quality in resources and facilities at most—though of course not all—independent schools, which arises from their ability to raise fees and fundraise, along with endowments that many of them have, is in contrast with the decline in the resources and facilities of state schools, including their playing fields, music and drama facilities and specialised coaching and teaching of specialised subjects, which is unlikely to be reversed under this Government, since they are committed to shrinking government spending further, including on education. The second part of the context is the charitable purposes of independent schools, which are often rooted in their founding purposes in education for local communities. I am well aware that the Charity Tribunal in 2011 said that purposes can change, and indeed have changed—although they have not entirely been discarded. We discussed this earlier, with the question of housing associations. A housing association that changes itself into something entirely different would have its charitable status questioned. I remind noble Lords that the ruling of the Charity Commission says that schools can choose how they demonstrate public benefit, not that they can disregard public benefit.

The third part of the context is the increased awareness within the educational world of the importance of resilience and self-confidence as wider elements in education, although, unfortunately—and the Independent Schools Council made this point to me—Ofsted no longer pays any attention in assessing state schools to the wider elements of education that encourage resilience and self-confidence. There is a consensus on how important these things are to individual development. Best practice in the independent schools sector recognises this, and there are a number of excellent examples of partnership between independent schools and the local communities—and their schools—in which they are embedded. There are some examples of less good practice, however, which is why the amendment talks about engaging “actively”. One of the weakest points, in the statement agreed between the Independent Schools Council and the Charity Commission, is to say that there will be a new website through which state schools will have a facility to request involvement in partnership activities. We want independent schools to go out to find, explore, pursue and develop partnerships with their local communities and state schools.

The strongest point of the ISC and Charity Commission is the commitment to a research report, 12 months from the introduction of these changes, which will review data from the annual reports of charitable schools as well as the aggregated data that the ISC collects through its census. At present, the details of how that research project is developed will be agreed between the Charity Commission and the ISC.

We are all conscious of the problems of defining public benefit. The NCVO advice on this amendment repeats that too strict a definition of public benefit gets one into enormous problems—and I am looking at the noble Lord, Lord Hodgson, who has said this to me, and many others, many times. But the Charity Commission must monitor that public benefit of some sort is provided. If the Minister is to say that the Charity Commission is not capable of doing that at present, many of us would say that the Charity Commission have been severely constrained in recent years. Faced with a Government who are cutting public expenditure, this very important third sector may need more effective regulation as we have to depend on it more and more.

We hope that we can avoid going down the road to a further statutory definition of public benefit. What the noble Lord, Lord Moynihan, and I wanted to achieve through this process was a strong nudge to the independent schools sector to move in the right direction. It will help us not to divide in this House if the Minister can give us a number of strong reassurances—first, to make it clear to independent schools that they are expected to pursue and develop partnerships, not just to wait and see whether anyone applies. They should see this as part of the social responsibility that all charities should shoulder. Secondly, we should engage with the ISC and the Charity Commission on the terms of the research project to be conducted over the next 12 months and not leave the definition entirely to them. Thirdly, it is important to report to Parliament on the outcome of this research and arrange for it to be debated either through an Oral Statement or otherwise in government time.

I hope that that gives the Minister sufficient space to take us forward, not necessarily to any form of mandatory obligation but certainly to say that we have moved independent schools towards the active partnership with their local communities and schools that we all want.

[Lord Moynihan (Con)]

My Lords, I shall speak to the amendment on the important question of the relationship between independent schools’ charitable status and public benefit and the need for all schools, particularly those with charitable status, to work together with state schools and neighbourhood communities in their vicinity. I intend to concentrate my remarks on the dual use of sports facilities and coaching expertise, although the principles behind my support for progress towards closer educational partnerships extend to all the charitable objectives set out by Parliament in the Charities Act.

In moving a probing amendment in Committee, my intention was to consider the merits and disadvantages in moving from the flexibility of the current system to a more prescriptive approach, reflected in the amendment that we are considering today, which requires all independent schools to engage with local communities, particularly regarding the dual use of sports and arts facilities. A considerable benefit of Committee for me was the opportunity that it provided to delve deeper into proposed legislation and learn significant lessons from the in-depth experience found in this House and outside.

Following Committee, like the noble Lord, Lord Wallace, I have taken the opportunity to meet the Charity Commission, the Independent Schools Council and the Minister to consider how we can make further progress to promote engagement with all independent schools in receipt of charitable status that have the facilities and coaching expertise to engage with local communities and state schools to mutual advantage. I am particularly grateful to my noble friend the Minister, who has upheld his open-door policy to any Member of your Lordships’ House on this Bill.

I spoke in Committee about good practice and cited Tonbridge School as a leading case study of good practice in this country. Under the leadership of Tim Haynes, the head, the school has engaged with 27 primary schools in its vicinity. The reaction from children, parents and the local community can best be described as fulsome praise. His initiative has gone further than engagement through sport, with the subjects of music, drama, dance, chess, art, design, IT, creative writing, science, history, maths, modern languages and classical studies all featuring as part of that engagement. Above all, all independent schools, such as Tonbridge School, in showcasing their facilities, should look to work also with governing bodies of sport, local clubs and those responsible in the primary schools for the school sport premium. That comes with £8,000 for schools with 17 or more pupils, plus an additional £5 per pupil, which could be very useful to fund insurance, transport and related costs incurred as a result of these initiatives.

To be successful, this must be a two-way process. Over the past few days, the Charity Commission has confirmed that it will relaunch and publicise the examples for schools of how to provide benefit for people who cannot afford their fees in its existing guidance, Public Benefit: Running a Charity, by sharing sports facilities. In a significant step forward, it will give new examples relating to sharing sports facilities, arts and music in the guidance Public Benefit: Reporting and in the example trustees’ annual report for “Anytown School”. A significant improvement in good practice should be achieved.

The problem I have with mandatory requirements is the one-size-fits-all approach. For example, many prep schools have to work to capacity to survive financially, even with charitable status. Some do not own their own sports facilities, others share and some are in need of significant upgrading. What is needed is for each school not only to follow best practice but, as the noble Lord, Lord Wallace, stated, for the Charity Commission to publicise it through its channels so that each school can tailor its public benefit accordingly and the House can debate the outcome.

The Charity Commission responded positively to the suggestion of a research report, in which I have more faith than the noble Lord, Lord Wallace. According to its guidelines, that report has to be published 12 months from the introduction of these changes. That research should provide us with a comprehensive picture of the extent of partnerships and enable this House to consider whether legislative steps are necessary, for example, when the next education Bill comes before us during this Parliament.

While there are challenges for independent schools with charitable status, the broader question we should also be debating applies not only to all independent schools but to the state sector, whether well-endowed with sports facilities or not. One of the greatest challenges we face in designing a long overdue and effective sports policy is the oft-quoted statistic about the percentage of our Olympic medallists from the independent sector. That reflects the need to do all we can, far more than at the moment, to identify talented youngsters in all our schools and provide ladders of opportunity for them to climb from primary school to podium.

In response to pressure from all sides of the House on this Bill, the Independent Schools Council has agreed to act by building a new website, Schools Together. The site is currently under development and should be ready to receive information from schools in the autumn term. It was not even on the agenda before Committee. I hope the site will be launched as soon as possible in the autumn. It must be two-way. The site absolutely needs to summarise what is on offer at all independent schools with charitable status and to include a facility for state schools to get involved in partnership activities. From the conversations I have had, I believe that independent schools will reach out to their community in this way by providing information and contact details of their partnership co-ordinators. State schools will be asked to request involvement in partnership activities. Since this is clearly the intent of all who have contributed to this debate at various stages, there should be no reason why all schools do not engage constructively. Once again, if the combined new commitments of the Charity Commission and the Independent Schools Council do not bear fruit in the way the House and the Minister have indicated, we should be able to produce legislative change through a wider education Bill.

I believe that these initiatives represent more than a nudge in the right direction. They are very significant steps forward and would not have happened had there not been the level of interest expressed in your Lordships’ House from all parties. They are tailor-made for the differences between schools and they avoid the cost and administration that a one-size-fits-all legislative approach would deliver. I believe that what I have sought to address constitutes a very strong example of how cross-party support for the interests of sport and recreation, including the arts and curricular subjects, for all children coupled with the promulgation of best practice can be and has been achieved. That is a rare outcome of negotiation between Committee and Report. I fully appreciate the strength of opinion expressed and I share it, but I believe that the changes we have been offered are far reaching and deserve support. I also believe they are for real. There is genuine consensus on this issue among all interested parties. I believe the approach offered will prove to all concerned that the proposed package will achieve even more with the good will of all involved than a one-size-fits-all amendment would deliver. For these reasons, I hope the amendment will not be pressed to a vote and that we can build on these important initiatives and regularly hold all those involved to account when it comes to the outcome of the research project and the website in a year’s time.

--- Later in debate ---

I finish with my overriding point. I share the noble Lord’s aims and sentiments. Where we differ—but I hope not enormously—is on the means. The package of measures I have just outlined sits well with the overall approach of the Bill. The measures are targeted, proportionate and balanced. They seek to underscore trustees’ obligations and responsibilities, and, crucially, to foster partnership. I hope that on that basis the noble Lord feels able to withdraw his amendment.

[Lord Wallace of Saltaire]

My Lords, this has been an important debate and a number of noble Lords, as well as the Minister, have said important things about what we need. I recognise that a number of noble Lords on the Conservative Benches have close links with the independent schools community. I trust that everything that has been said will be taken back and pursued further. I particularly welcome the point made by the noble Lord, Lord Moynihan, that we expect a positive response to all that has been said. If necessary when the research report comes out, if good progress and significant movement has not been achieved, we will clearly have to move further again.

We all recognise that charitable status is a privilege and that public benefit has to be part of the response to that privilege. We all also recognise that public benefit is very difficult to define and that there are many other areas, including religious groups, where public benefit can sometimes be extremely contentious. That is an issue to which we may well return during the course of this Parliament.

The research project is key, and I welcome the Minister’s response that we will be able to debate that report when it returns and see how thorough it has been and what it shows. On that basis, I am willing to withdraw my amendment. I am a liberal, not a socialist: I prefer co-operation and partnership to compulsion and the imposition of penalties. I would not vote for Jeremy Corbyn as my party leader. I want to see a strong and diverse charitable sector, including many schools founded as charities serving different purposes. However, it is also clear that schools that have been founded as charities have to pursue charitable purposes and demonstrate public benefit. That is what we have been calling for. On that basis, and on the basis that this discussion will continue with many of us on all sides of the House actively engaged, I am willing to withdraw the amendment.

Some Lords objected to the request for leave to withdraw the amendment, so it was not granted.