Taunton councillor wants independent schools to forgo some tax relief to keep local services open. Could it be a model for the future?

When councillor Libby Lisgo visits one of the most deprived estates in Taunton, in her ward of Priorswood, she can see the fence of Taunton school, one of the area’s famous independent schools. “While we are struggling to raise funds to take local residents on rare day trips, I can see a fleet of minibuses on the other side of that fence, sitting idle,” she says. “And I can’t help thinking: ‘Gosh, if only we could access those from time to time’.”

Like most local councillors since 2010, Lisgo has had to oversee and implement brutal cuts to services, including closing libraries and community centres, while at the same time formally approving an annual 80% tax break on business rates for local private schools.

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Business rate relief for private schools has become controversial in recent years, with the Scottish government taking the radical step to abolish it from September 2020 and moves in England, announced in the recent budget, to review it.

It was after a particularly gruelling budget-setting meeting in 2017 that Lisgo’s colleague Steve Ross, an independent councillor, hit on the idea of asking the four local private schools – Taunton school, Wellington school, Somerset, King’s College Taunton and Queen’s College Taunton – each to contribute 10% of their business rate relief. This would provide an overall sum of around £100,000, out of a rate relief saving of near on £1m, to a community fund that would support libraries, children’s services and other local projects. They put the idea to the council and proposed tightening up council scrutiny of the “public benefit” offered by the schools, their duty under the 2006 Charities Act.

Conservative-controlled Taunton Deane voted down the proposal. Councillors, many of whom had links to the area’s private schools, instead suggested opening up a “dialogue” with the four schools. Sadly, says Lisgo, that never happened.

Recently, Lisgo saw her chance to have another go, after the merger of Taunton Deane with neighbouring West Somerset to create Somerset West and Taunton, now under Liberal Democrat control.

Armed with what she calls her “oven-ready idea”, she was more optimistic. “If austerity was very much on our minds in 2017, it is even more so three years down the line,” she says. This time her motion also proposed the establishment of “a joint consultative body” to explore providing “volunteering and financial support to our neediest communities”.

Once again the motion failed. “One reason put forward by the councillors was that the finances of the local independent schools are on a knife edge,” she says. Lisgo found this hard to take seriously given that “one school has recently hosted receptions in Hong Kong, Dubai and Los Angeles”, with more global events planned. “And we are asking for a token amount really: £25,000 each, less than the average cost of a single boarding place.”

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Francis Green, the educational economist and co-author of Engines of Privilege: Britain’s Private School Problem, shares Lisgo’s disappointment. “One can’t help thinking that the local private schools may have missed a trick here, a chance to earn some goodwill for the long run. Rather than take this low-cost opportunity to transparently discharge their obligation to provide some public benefit, they and their supporters in council have preferred to stick to their legal rights as charities.”

Undeterred, Lisgo, branded a “Marxist” in one local newspaper headline, is now inviting other councils to have a go – “maybe a Labour-controlled council with a reasonable number of independent schools in their area”.

Will others take it up? Julie Robinson, of the Independent Schools Council, says: “It is not the role of local councils to regulate local charities or decide how charitable funds are spent. Charities must apply their assets and funds to their primary purpose as stated in their objects. In the case of schools, that is education.”

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But opinion may be shifting. In the recent budget, the government announced a review of business rates and the Independent Schools Association, which promotes the charitable objectives of private schools, is now warning the sector that business rate relief may not survive beyond 2021. More broadly, there is a widespread sense across the political spectrum that the resources gap between private and state schools is unacceptably wide and reform is necessary. This makes voluntary contributions look like a moderate step rather than an extreme proposal.

The Conservative-controlled Westminster council is currently asking householders in properties worth more than £10m (council tax band H) to contribute a small sum to local services, and has so far raised £900,000 through this “unofficial mansion tax”. Kensington and Chelsea and Surrey councils have implemented similar plans.

Mark Lehain, a free school founder and Conservative party candidate in the last election, says Lisgo’s plan is an interesting idea but that private schools would need to have “control over how the funds were used to make sure they were for educational purposes”.

Many in Labour local government dislike the voluntary angle. Steven Longden, a Trafford councillor and co-founder of the campaign Abolish Eton, thinks going down this route merely “gives private schools good PR. Do we really want the voluntary crumbs off their table? No, I want legislation to remove their privileges and tax exemptions.”

Succeed or fail, the proposal has created a useful mobilising tool. Historically, the political conversation around the private-state divide has tended to be about national inequalities: all those privately educated judges and journalists and old Etonian prime ministers.

But Lisgo’s initiative brings the issue back down to local earth, shining a spotlight on the vastly discrepant provision often found within a single area. “A lot of people locally have said to me, ‘I didn’t realise that these schools were charities – and you mean that they don’t pay business rates like everyone else?”’

Lisgo remains upbeat. “I have had so many conversations around the proposal. People think it is a jolly good idea. If we had genuinely begun to initiate that dialogue between our schools and the council, things might look different. I still struggle to understand why we can’t make use of those minibuses parked on the other side of the fence.”