Public benefit any clearer?

The issue of public benefit has been a sure way to grab the headlines and it is a topic which sparks debate for all of those involved in the independent education sector. Kristine Scott reports on the Charity Commission’s clarification

The recent announcement by the Charity Commission to give independent schools up to five years’ breathing space if they fail to meet the public benefit test hit the headlines, but what does it actually mean?

If a school fails to meet the public benefit test, they could potentially lose their charitable status. The assessment of the five schools inspected by the commission highlighted that bursary provision was seen by the Commission as an essential component of public benefit.

Dame Suzi Leather, chair of the commission, told the annual gathering of the Headmasters’ and Headmistresses’ Conference in October 2009 that the commission recognised that developing partnership activities or building up a bursaries fund will take time. She went on to say that where a charity needs an extended period to make the necessary changes (ie where they are not currently meeting the public benefit test), the commission will be prepared to give that charity no longer than five years to make those changes to satisfy that request.

Where now for schools?
The message seems to be that if a school fails to meet the test, more time (up to five years) will be given to the school to implement any plan agreed with the commission. What remains unclear is what the “test” actually is and how schools may satisfy that requirement.

In light of the announcement, what steps should schools take at this time?
• the trustees should ensure that they have read the guidance published by the commission and the assessment of the five independent schools in July 2009;
• the trustees should ensure that the annual report complies with the reporting requirements and includes information about activities that have been carried out which are for the public benefit;
• consider any policy on bursaries and whether this needs to be reviewed;
• the trustees should consider any steps they may put in place to extend activities for the public benefit in the future and must have a clear plan for implementing these activities; and
• ensure that the prospectus, website and other appropriate documents of the school make reference to public benefit activities where necessary.

The requirement to demonstrate public benefit remains and it would be incorrect to say that schools have an additional five years to satisfy that requirement. Subject to any legal challenge, public benefit should remain high on the agenda for independent schools. Schools hopefully have a little more time to develop an approach or scheme that is sustainable, while receiving an acknowledgement from the commission that, in the current economic climate, building up a bursaries fund will take time as well as money.

Kristine Scott is a solicitor advocate at Rickerbys LLP. Kristine specialises in employment law in the education sector.

Return to Governance