Four private schools told help poor or lose tax perks

Published on Tuesday 28 October 2008 21:03

PRIVATE schools must provide substantial financial help to less-wealthy families or face losing millions in tax benefits.

The Office of the Scottish Charity Regulator (OSCR) yesterday ruled that four independent schools failed to meet the test for charitable status because few of the bursaries they offered were means-tested.

The OSCR said the schools failed the public interest test because access to the school was limited to the well-off.

Lomond School, in Helensburgh, saw just two of its 583 pupils receiving means-tested help last year, while at St Leonards, in St Andrews, the figure was less than 1 per cent of pupils.

At Merchiston in Edinburgh – despite 41 per cent of pupils receiving help – just 3.7 per cent was based on ability to pay, while the figure was 2.6 per cent at Hutchesons' in Glasgow.

That compares to Gordonstoun – which charges Scotland's highest fees – where 13.4 per cent of pupils receive some means-tested support.

While Gordonstoun passed the test and retained its status, the other four schools could be stripped of charitable status within three months if they fail to say how they will rectify the situation. If they do so, they will have up to three years to implement changes.

Jane Ryder, the OSCR's chief executive, said: "We concluded that … the public benefit test was not met, mainly due to significant fees and the fact that there was not sufficient help in place so that those who cannot pay the fees can also benefit from what the charity does.

"We are not dictating a particular business model to the charities and there are different ways in which they can address our concerns."

George Heriot's in Edinburgh, Gordonstoun School in Moray, St Mary's Music School in Edinburgh, the Glasgow Steiner School, Donaldson's College in Linlithgow and the Regius Christian School in Edinburgh all passed the test.

Dundee High was the first independent school to undergo and pass the test last year.

Charitable status is worth 4.5 million to the sector in tax and rates rebates.

Lord Foulkes, the Labour MSP for the Lothians, said private schools must change substantially. He said: "They cannot continue as bastions of privilege and still expect to retain charitable status. All the people who are connected with the independent sector have been deluding themselves into thinking this privilege can continue."

Scotland's only school directly funded by government, also failed to meet the qualifying test on a technicality.

However, Jordanhill School's admissions policy, which has courted controversy recently, was given approval.

The OSCR ruled the policy, which limits admission to certain house numbers on specific streets, was an appropriate way of tackling huge demand in a catchment where housebuilding is growing. The school failed the test on the grounds it is subject to ministerial control.

Head teacher Dr Paul Thomson said an amendment of the Glasgow school's constitution would fix the problem. The government must give permission for this and a spokesman said it supported helping the school maintain charitable status.