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Private vs State Schools: The Economic Battleground


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Just a few days ago, the Social Mobility and Child Poverty Commission (2014) released a new report arguing that the UK remains “deeply elitist” and that the number of privately educated and Oxbridge graduates in top jobs has effectively created a “closed shop at the top.”[1] The report reignited an old political debate, re-setting old divisions and frankly produced more heat than light as Guardian[2] and Independent [3] columnists encouraged the abolition of private education and the Telegraph [4] called for state schools to imitate and compete against them. Yet there was surprisingly little discussion of the economic aspect of the issue – do private schools help or hinder the UK economy?

 A recent report by Oxford Economics (2014) for the Independent Schools Council found that the sector adds “an annual GDP contribution of £9.5 billion, larger than the City of Liverpool or the BBC,” supports 227 000 jobs and provides tax revenues of £3.6 billion per year. Yet there’s also a plethora of evidence which suggests that diversity is good for business, and that increased diversity in decision-making bodies improves overall decision-making [5]. It follows, then, that were there increased diversity at the very top of government and industry, where the most important decisions are made, the wider economy would benefit. Yet the nature of private education in Britain, at least in its present form, undeniably restricts several strands of diversity from making that journey to the top. For the sake of brevity, I’m only going to focus on two strands of diversity in this article – socio-economic background and gender. That’s not to say that others, are not important – cultural background and ethnicity spring to mind – but there’s simply not enough space to adequately address them.

Firstly, socio-economic background. While it’s true that several top private schools take students from very poor backgrounds on bursaries,6 these are the exception rather than the rule. When the chips are down, after all, private education is private – lacking state funding, it has to sustain itself on the fees its ‘consumers’ pay. By nature, this prices out the vast majority of children from low socio-economic backgrounds, while giving an immediate and substantial advantage to the existing elite. Recent research by the Social Market Foundation (2014) found that a third of private schoolchildren come from families in the top 10 percent of the income distribution, and half come from families in the top 20 percent. Families in the bottom 30 percent, meanwhile, send just 8 percent of students to private school. The same research also found that, were independent schools to select on merit, they would take 62 percent more children from the bottom 40 percent and 48 percent fewer children from the top 10 percent – so, as the system works now, money speaks louder than ability. The higher-ranked the private-school is, the greater this advantage becomes – among the top public schools, fees now top £30 000 per annum, [7] a sum out of reach of the average family (who currently earn £32 488 a year after tax, but far less after other essentials are paid for (Adams et al., 2014). If the current trends continue, private education will continue to become more expensive while wages stagnate, [8] pricing out more and more families each year [9]

Secondly, gender equality at the top is held back by private education – or, to be more specific, by the hegemony of top public schools who also, by and large, happen to be single sex. That sex, of course, is male. Of England’s seven public schools, only two are co-educational and none are girls-only; the other five, naturally, only teach boys [10]. More to the point, the latest Sutton Trust (2011) figures attest that five schools sent more students to Oxbridge over a three-year period than 2000 other schools combined. Of these, four were public schools – Eton, Westminster, St Paul’s Boys and St Pauls’ Girls – and only one admits girls throughout ages 13-18 [11]. Westminster admits girls into its sixth form, true, but even here boys outnumber girls considerably – only one in three sixth form students are girls [12]. Moreover, a 2012 survey which examined leaders across industries found that the top 10 schools for leaders were Eton, Winchester, Charterhouse, Rugby, Westminster, Marlborough, Dulwich, Harrow, St Pauls’ Boys and Wellington – of these, seven are boys only and three are co-educational, with none being girls-only [13].

Of course, it could be claimed that private/public education actually helps women – that, while less women achieve top jobs and positions of responsibility, those that do could be overwhelmingly privately educated. Yet observe the makeup of Parliament’s ruling party. Of the Conservatives’ 49 female MPs, only 17 attended private schools – just over a third [14] That’s still an over-representation compared to the general population, but it’s far lower than the equivalent figure for men – of the Conservatives’ 257 male MPs, over half (148) attended private schools. And incidentally, it’s lower that the number of (by necessity, male) Conservative MPs who attended just one public school – Eton – of which there are 19 [15] So while private school evidently gives Conservative women a small advantage over state-educated women, it’s dwarfed by the boost private education provides men.

So, what is to be done? Well, I’d certainly not advise the abolition of private schools. Not only would this require substantial effort – not to mention tapping into a public desire for abolition which, as Ian Jack notes1 [6], simply isn’t there – to do so would, in the short term at least, be rather difficult for the government to manage. The GDP boost private schools provide would dissipate, while the government would instantly lose £3.6 billion per year in tax revenue. And the education sector would be faced with a massive challenge, as the 625,000 children who attend private schools [17] would be effectively school-less – the state would need to find them places in its schools, and it’s having a hard enough time finding places for pupils already [18]. It could nationalise private schools instead, meaning there’d be no need to rehouse pupils – but it’d have to find the money for this at a time of austerity, at the same time as losing a significant amount of tax revenue. Whichever path it chose, the government would have to increase expenditure to pay for the education of these 625,000 new state-school children; which, according to the latest figures, would cost £3.38 billion a year [19]. True, this is not a massive amount in the context of Britain’s GDP, which currently stands at $2.828 trillion [20] But with economic policy so often decided on the thinnest of margins, such changes could easily be the difference between deficit or surplus. And this would likely impact the wider economy – especially when such an issue is especially potent in the current political climate.

Yet it must also be recognised that the current system of private schooling stifles diversity at the top of businesses, especially in terms of gender and socio-economic background. And those who benefit most from private education aren’t diverse in the slightest – they’re overwhelmingly from high socio-economic backgrounds, [21] and as evidenced above, too often the boost private education gives to women is negated by the far larger boost top private schools give men. One does not need to be an abolitionist to recognise that a huge number of independent and different-thinking minds, who could hugely enrich government and industry policy and the wider economy, just aren’t getting there – and private schools certainly aren’t helping them.


Jonathan is a 3rd year BA English Literature and Language student at King’s College London. His interests lie in arguing the economic angles of political issues, which he feels are too often ignored.


Social Mobility and Child Poverty Commission. (2014). Elitist Britain?. Retrieved from: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/347915/Elitist_Britain_-_Final.pdf

Oxford Economics. (2014). The impact of independent schools on the UK economy. Retrieved from: http://www.isc.co.uk/Resources/Independent%20Schools%20Council/Research%20Archive/Publications/ISC_ECONOMICS_REPORT.pdf

Social Market Foundation (2014). Open Access: An independent evaluation. Retrieved from:http://www.smf.co.uk/wp-content/uploads/2014/07/Open-Access-an-independent-evaluation-Embargoed-00.01-030714.pdf

Adams, A. et al. (2014). Richest have seen biggest cash income squeeze but poorest have faced higher inflation. Institute of Fiscal Studies. Retrieved from: http://www.ifs.org.uk/pr/income_squeeze_jan2014.pdf

1) Sparrow, A. (2014). Closed shop at the top in deeply elitist Britain, says study. The Guardian. Retrieved from: http://www.theguardian.com/society/2014/aug/28/closed-shop-deepy-elitist-britain

2) The Guardian (2014). Elitism and a skewed view of Britain’s diversity. The Guardian. Retrieved from: http://www.theguardian.com/society/2014/aug/29/elitism-skewed-view-britain-diversity

3) Blackhurst, C. (2014). When elitism grips the top of British society to this extent, there is only one answer: Abolish private schools. The Independent. Retrieved from: http://www.independent.co.uk/voices/comment/when-elitism-grips-the-top-of-british-society-to-this-extent-there-is-only-one-answer-abolish-private-schools-9696813.html

4) Mount, H. (2014). Don’t attack public schools and Oxbridge – imitate them. The Telegraph. Retrieved from:http://blogs.telegraph.co.uk/culture/harrymount/100076045/dont-attack-public-schools-and-oxbridge-imitate-them/

5) Smedley, T. (2014). The evidence is growing – there really is a business case for diversity. Financial Times. Retrieved from: http://www.ft.com/cms/s/0/4f4b3c8e-d521-11e3-9187-00144feabdc0.html#axzz3C0LaGKod

6) Scholarships Bursaries Grants And Awards. The Good Schools Guide. Retrieved from: http://www.goodschoolsguide.co.uk/help-and-advice/choosing-a-school/finance-school-fees/52/scholarships-bursaries-grants-and-awards#

7) Paton, G. (2010). Private school fees ‘now top £30,000’ The Telegraph. Retrieved from: http://www.telegraph.co.uk/education/educationnews/6998448/Private-school-fees-now-top-30000.html

8) Chan, S., & Spence, P. (2014). Weak wage growth suggests interest rates on hold until next year. The Telegraph. Retrieved from: http://www.telegraph.co.uk/finance/bank-of-england/11032479/Weak-wage-growth-suggests-interest-rates-on-hold-until-next-year.html

9) Elledge, J. (2013). Private schools are heading for a crunch. Financial Times. Retrieved from: http://www.ft.com/cms/s/0/6c11884c-fe8e-11e2-b9b0-00144feabdc0.html#axzz3C0LaGKod

10) The Editors of Encyclopaedia Britannica. (2014). Public School. Retrieved from: http://www.britannica.com/EBchecked/topic/482497/public-school

11) Berg, S. (2011). Five schools ‘send more to Oxbridge than 2,000 others’ BBC. Retrieved from: http://www.bbc.co.uk/news/education-14069516

12) Westminster School Prospectus. Retrieved from: http://www.westminster.org.uk/assets/prospectus.pdf

13) The Sutton Trust. (2012). Westminster School Prospectus. Retrieved from: http://www.suttontrust.com/wp-content/uploads/2012/11/TOP-People-report-final.pdf

14) Conservative Women MPs. Retrieved from: http://www.conservativewomen.org.uk/mp.asp

15) Hackett, P. & Hunter, P. (2011). Who Governs Britain?. Smith Institute. Retrieved from: http://www.smith-institute.org.uk/file/Who-Governs-Britain.pdf

16) Jack, I. (2012). Abolish private schools? Not enough of us want it badly enough. The Guardian. Retrieved from: http://www.theguardian.com/commentisfree/2012/may/18/abolishing-private-schools-wont-happen

17) Research. (2014). Independent Schools Council. Retrieved from: http://www.isc.co.uk/research

18) School Places ‘Crisis’ Worsens As Govt Slammed. (2014). Sky News. Retrieved from: http://news.sky.com/story/1288448/school-places-crisis-worsens-as-govt-slammed

19) Young, T. (2011). Should private schools be abolished? The Telegraph. Retrieved from: http://blogs.telegraph.co.uk/news/tobyyoung/100114147/should-private-schools-be-abolished/.

Raw data from ‘Funding for primary and Service Children’s Education schools’, Gov.UK, https://www.gov.uk/government/publications/funding-for-primary-and-service-childrens-education-schools

20) Rogers, S., & Sedghi, A. (2013). UK GDP since 1955. The Guardian. Retrieved from: http://www.theguardian.com/news/datablog/2009/nov/25/gdp-uk-1948-growth-economy

21) Paton, G. (2013). Pupils ‘segregated from society’ by exclusive private schools. The Telegraph. Retrieved from: http://www.telegraph.co.uk/education/educationnews/10046861/Pupils-segregated-from-society-by-exclusive-private-schools.html

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