Do UK boarding schools actually make ANY profit? Watch

EtonWorldDoppler
Badges: 2
Rep:
?
#1
Report Thread starter 3 weeks ago
#1
Do boarding schools make any profit?

If, for example, I'm a private boarding school charging an average of £10,500 per term per pupil and have 200 fee-paying boys attending who are paying the full fees.

Do these schools actually make any profit?
Last edited by EtonWorldDoppler; 3 weeks ago
0
reply
Drewski
Badges: 19
Rep:
?
#2
Report 3 weeks ago
#2
They wouldn't still be there if they didn't.

NB, not profit in the business sense. Profit in that their incomings are more than their outgoings , but within the realms of what's possible for a charity.

Remember, FIFA is a non-profit with $2bn in the bank...
Last edited by Drewski; 3 weeks ago
1
reply
yelir
Badges: 19
Rep:
?
#3
Report 3 weeks ago
#3
Of course they do, otherwise they wouldn't exist.
1
reply
Muttley79
Badges: 19
Rep:
?
#4
Report 3 weeks ago
#4
(Original post by EtonWorldDoppler)
Do boarding schools make any profit?

If, for example, I'm a private boarding school charging an average of £10,500 per term per pupil and have 200 fee-paying boys attending who are paying the full fees.

Do these schools actually make any profit?
They are businesses so of course they do! Business always comes first. They make money from other things like hiring out facilities and they get a tax hike.
1
reply
Princepieman
Badges: 21
Rep:
?
#5
Report 3 weeks ago
#5
i mean they're non-profits so no
1
reply
threeportdrift
Badges: 20
Rep:
?
#6
Report 3 weeks ago
#6
(Original post by EtonWorldDoppler)
Do boarding schools make any profit?

If, for example, I'm a private boarding school charging an average of £10,500 per term per pupil and have 200 fee-paying boys attending who are paying the full fees.

Do these schools actually make any profit?
The majority of UK independent schools are charities, so they do not and cannot make a profit. The very few for-profit schools are usually small, family-run schools and as such make very little profit.
2
reply
gr8wizard10
Badges: 21
Rep:
?
#7
Report 3 weeks ago
#7
(Original post by Princepieman)
i mean they're non-profits so no
really? I would imagine they do - they're run as independent businesses afaiw.

there are PE firms who literally buy these private schools and expand margins to then sell on
0
reply
threeportdrift
Badges: 20
Rep:
?
#8
Report 3 weeks ago
#8
(Original post by gr8wizard10)
really? I would imagine they do - they're run as independent businesses afaiw.

there are PE firms who literally buy these private schools and expand margins to then sell on
The vast majority of independent schools are charities. I don't have any stats to hand, but I'd say well upwards of 80%*. The truly privately-owned schools are almost all very small, family owned businesses and tiny faith schools.

I've been a Bursar at one of the top independent schools, and am pretty au fait with how the sector works, and I've never heard of PE firms getting involved. It might be the way a few have expanded overseas, Dulwich etc, but my school expanded overseas and it certainly wasn't a consideration, or discussion. Whether it's how some of the large groups who operate primarily overseas operate, I couldn't say. But it's not a UK independent school feature.

Latest data from the Independent Schools Council 77%
Last edited by threeportdrift; 3 weeks ago
2
reply
gr8wizard10
Badges: 21
Rep:
?
#9
Report 3 weeks ago
#9
(Original post by threeportdrift)
The vast majority of independent schools are charities. I don't have any stats to hand, but I'd say well upwards of 80%. The truly privately-owned schools are almost all very small, family owned businesses.

I've been a Bursar at one of the top independent schools, and am pretty au fait with how the sector works, and I've never heard of PE firms getting involved. It might be the way a few have expanded overseas, Dulwich etc, but my school expanded overseas and it certainly wasn't a consideration, or discussion. Whether it's how some of the large groups who operate primarily overseas operate, I couldn't say. But it's not a UK independent school feature.
this is news to me, thanks - perhaps its an international thing.

these independent schools - i imagine primarily rent the land they operate on, perhaps its the holding groups that turn the profit - i.e. leasing out the facilities - but under the management of the school brand.

just curious to understand the flow of capital - because i'm almost certain these school turn profit - and that unless they have insane capex or maintenance requirements (because human capital spend isn't ludicrous at most of these schools) these funds must be going somewhere.
Last edited by gr8wizard10; 3 weeks ago
1
reply
threeportdrift
Badges: 20
Rep:
?
#10
Report 3 weeks ago
#10
(Original post by gr8wizard10)
this is news to me, thanks - perhaps its an international thing.

these independent schools - i imagine primarily rent the land they operate on, perhaps its the holding groups that turn the profit - i.e. leasing out the facilities - but under the management of the school brand.

just curious to understand the flow of capital - because i'm almost certain these school turn profit - and that unless they have insane capex or maintenance requirements (because human capital spend isn't ludicrous at most of these schools) these funds must be going somewhere.
I've just made an edit to my previous. Most recent data 77% charities, but those that aren't tend very much to be smaller and numbers are boosted by these city-based faith schools.

No, the classic situation for an independent school is that it owns, or rents at a peppercorn rent from another charity designed for that purpose, it's land and estate. The primary cost of running an independent school is staff, if memory serves 70% of income goes on staff salaries (circa 51-54% for universities).

There is no profit, they are not allowed to make a profit as charities. It's easy enough to look up the accounts of any charity, independent school or otherwise and check out the rough pattern of their monies.

Fees are always the primary source of income, in some cases the only source. The very large schools, Eton, Harrow, Winchester have endowments they can call on, but not usually to the same scale as say, Oxbridge Colleges. Most recycle about 12% of fee income back in the form of scholarships and bursaries, ie there is a pretty direct flow of finance from wealthy parents to the fees that support poorer pupils.

Prior 2006, the provision of education was automatically considered charitable. Since 2006 that has not been the case, and independent schools have had to demonstrate their charitable activities more clearly (through their annual report). In doing that, they have accelerated access to local schools and groups to their facilities.

Most schools will invest any surpluses in sports facilities first, then arts facilities, then classroom facilities, then lab facilities. The order of these facilities being the order in which they can most usefully demonstrate public benefit and generate income. So for instance, my last school had very extensive sports facilities, and these were used by local schools every week, for free. They were also used by sports teams up to national level for cost. We also ran a 3,000 member private sports club which was a commercial enterprise (which charities frequently run under an appropriate scheme) and paid all its profits to the bursary funds of the school.
Last edited by threeportdrift; 3 weeks ago
0
reply
gr8wizard10
Badges: 21
Rep:
?
#11
Report 3 weeks ago
#11
(Original post by threeportdrift)
I've just made an edit to my previous. Most recent data 77% charities, but those that aren't tend very much to be smaller and numbers are boosted by these city-based faith schools.

No, the classic situation for an independent school is that it owns, or rents at a peppercorn rent from another charity designed for that purpose, it's land and estate. The primary cost of running an independent school is staff, if memory serves 70% of income goes on staff salaries (circa 51-54% for universities).

There is no profit, they are not allowed to make a profit as charities. It's easy enough to look up the accounts of any charity, independent school or otherwise and check out the rough pattern of their monies.

Fees are always the primary source of income, in some cases the only source. The very large schools, Eton, Harrow, Winchester have endowments they can call on, but not usually to the same scale as say, Oxbridge Colleges. Most recycle about 12% of fee income back in the form of scholarships and bursaries, ie there is a pretty direct flow of finance from wealthy parents to the fees that support poorer pupils.

Prior 2006, the provision of education was automatically considered charitable. Since 2006 that has not been the case, adn independent schools have had to demonstrate their charitable activities more clearly (through their annual report). In doing that, they have accelerated access to local schools and groups to their facilities.

Most schools will invest any surpluses in sports facilities first, then arts facilities, then classroom facilities, then lab facilities. The order of these facilities being the order in which they can most usefully demonstrate public benefit and generate income. So for instance, my last school had very extensive sports facilities, and these were used by local schools every week, for free. They were also used by sports teams up to national level for cost. We also ran a 3,000 member private sports club which was a commercial enterprise (which charities frequently run under an appropriate scheme) and paid all its profits to the bursary funds of the school.
useful insights - might have to delve into these accounts.

appreciate your time taken to look into this.
0
reply
EtonWorldDoppler
Badges: 2
Rep:
?
#12
Report Thread starter 3 weeks ago
#12
(Original post by threeportdrift)
I've just made an edit to my previous. Most recent data 77% charities, but those that aren't tend very much to be smaller and numbers are boosted by these city-based faith schools.

No, the classic situation for an independent school is that it owns, or rents at a peppercorn rent from another charity designed for that purpose, it's land and estate. The primary cost of running an independent school is staff, if memory serves 70% of income goes on staff salaries (circa 51-54% for universities).

There is no profit, they are not allowed to make a profit as charities. It's easy enough to look up the accounts of any charity, independent school or otherwise and check out the rough pattern of their monies.

Fees are always the primary source of income, in some cases the only source. The very large schools, Eton, Harrow, Winchester have endowments they can call on, but not usually to the same scale as say, Oxbridge Colleges. Most recycle about 12% of fee income back in the form of scholarships and bursaries, ie there is a pretty direct flow of finance from wealthy parents to the fees that support poorer pupils.

Prior 2006, the provision of education was automatically considered charitable. Since 2006 that has not been the case, and independent schools have had to demonstrate their charitable activities more clearly (through their annual report). In doing that, they have accelerated access to local schools and groups to their facilities.

Most schools will invest any surpluses in sports facilities first, then arts facilities, then classroom facilities, then lab facilities. The order of these facilities being the order in which they can most usefully demonstrate public benefit and generate income. So for instance, my last school had very extensive sports facilities, and these were used by local schools every week, for free. They were also used by sports teams up to national level for cost. We also ran a 3,000 member private sports club which was a commercial enterprise (which charities frequently run under an appropriate scheme) and paid all its profits to the bursary funds of the school.
Very useful and very accurate info. Helps to be aware. Thanks.
0
reply
Muttley79
Badges: 19
Rep:
?
#13
Report 3 weeks ago
#13
(Original post by Princepieman)
i mean they're non-profits so no
No they are not! They are all business - they close if they don't make money,
0
reply
X

Quick Reply

Attached files
Write a reply...
Reply
new posts
Back
to top
Latest
My Feed

See more of what you like on
The Student Room

You can personalise what you see on TSR. Tell us a little about yourself to get started.

Personalise

How has the start of this academic year been for you?

Loving it - gonna be a great year (131)
17.99%
It's just nice to be back! (197)
27.06%
Not great so far... (263)
36.13%
I want to drop out! (137)
18.82%

Watched Threads

View All