By Richard Hatcher (Faculty of Education, University of Central England, Birmingham)
august 1999
Education Action Zones are test-beds for future developments in education, and one of them is much closer involvement by the private sector in schools. Zones are required to have business partners and to find £250,000 a year funding from the private sector. They include major international companies such as ICI, Barclays Bank, Colgate Palmolive, John Laing Construction, Kelloggs, Tesco, McDonald's, Shell, Tate and Lyle, American Express, British Aerospace and Rolls Royce. Particularly prominent are information technology companies, including some of the biggest names: IBM, Bull Information Services, British Telecom, Research Machines. They are joined by a new but expanding business sector - companies such as Nord Anglia and Arthur Andersen aiming to contract-out education management and other services from schools and local authorities.
Why is the Labour government so enthusiastic about business involvement in the EAZs, and why are companies interested in being involved?
The part-funding of Zones by business reflects the government's aim of reducing current state spending on education, most notably demonstrated by the use of the PFI to finance school building (Whitfield 1999). It is true that the amount required of each Zone is relatively small in comparison with school budgets, but it serves two other equally important purposes: to reinforce a culture of entrepreneurialism in schools and to integrate them more closely into business agendas.
But why should business want to give money to schools? After all, the Conservative government had little success with business funding of CTCs. First, it should be noted that business contributions to EAZs are often in kind rather than in cash. Secondly, business is in business for profit, and their involvement in EAZs is intended to further, directly or indirectly, that purpose, in a number of ways.
Many companies offer various forms of support to schools through networks such as the Education Business Partnerships and Business in the Community. National Power, for instance, has given £150 million to 500 schools for numeracy projects. They claim that 'This is all about wanting to help in the communities we serve. As a blue chip company we feel it is appropriate to education. There is no commercial spin-off and we are not looking for publicity' (TES 26-6-98). However, even the most apparently altruistic policy harvests commercial benefit. It enhances corporate image, facilitates advantageous relationships with government, and provides an argument for why business should not be taxed more heavily.
However, most companies which are involved in EAZs have more direct commercial benefits in mind: to create a profitable future workforce, to sell products to pupils and their parents, to take over school and LEA management and other services, and to technologise teaching and learning.
Shaping the future workforce
The contribution of money by companies directly to schools, rather than indirectly through the tax system, enables them more effectively to influence the schools with a business agenda, either to shape the education of their own future employees through the development of appropriate 'employability' skills, or to create a better qualified future workforce to the advantage of the economy as a whole. The tying of schools more closely to the employers' agendas is a key theme of Labour education policy. In the words of Nicholas Tate, chief executive of the Qualifications and Curriculum Authority,
Business needs to help us revise the national curriculum so that it meets the needs of a rapidly changing economy.
Business needs to tell us what qualities it is looking for in the young people pursuing qualifications in schools and colleges. Above all, business needs to be the dominant voice in the development of vocational qualifications. (TES 26-6-98)
Turning pupils and parents into customers
For many companies, sponsorship of schooling can clearly provide direct commercial benefits in terms of sales of their products. For example, Walkers Snack Foods fund literacy programmes in primary schools, and National Westminster Bank sponsors the 'Face 2 Face with Finance' numeracy programme. Kelloggs, a partner in the Salford and Trafford EAZ, is sponsoring six breakfast clubs. In the jargon this is 'cause-related marketing', good for the corporate image and for future sales, as charges for parents are phased in.
Providing business management
For Labour, the success of the whole modernising project of 'school improvement' cannot be entrusted to teachers. Schools need to import business management expertise. In the words of Michael Barber, launching the EAZ project at the North of England Education Conference in January 1998, 'Successful companies are uniquely able to manage change and innovation' (The Guardian 7-1-98). One source of management expertise is large companies who can provide mentors for headteachers in Zone schools. But Zones offer opportunities for a new phenomenon - companies whose business is taking over school and LEA management and service delivery functions for profit.
The element in the EAZ project which has attracted some of the strongest criticism from teachers has been the invitation by government to private companies to lead Zone bids. None of the first phase of zones are led by business, but the government has expressed its unhappiness with this and has made it clear that it is looking for some business-led bids in the second phase.
An encouraging sign for business was the invitation by Surrey County Council to private companies to tender for the franchise to run the 'failing' King's Manor school in Guildford. There are a number of companies which are interested in running EAZs. Some of them are currently establishing their credibility by working as management partners in LEA-led Zones. One of the leading candidates is Nord Anglia PLC, which is involved in two Zones, Barnsley and Weston-super-Mare. It will provide development training, inservice training, consultancy, cross-curricular developments and target-setting. Nord Anglia is another of the boom companies of commercialised education. It runs 16 private schools, from Russia to New Zealand. In the UK it is involved in a series of PFI initiatives to build and operate new schools. It has also launched a nursery division. Its chair, Kevin McNeany, has a personal fortune of £20 million. Nord Anglia's shares rocketed from £1.94 to £2.58 in a few days when their involvement in the two successful EAZ bids became known, increasing the value of Mr McNeany's 46% shareholding by £3.6m (TES 16-1-98).
But the majority of companies involved as partners in EAZs are not interested in directly running schools themselves. They are aware of the political riskiness of relying on a project of, in effect, privatising schools for profit. (Edison, an American schools-for-profit company, says it has pulled out of the UK on these grounds). A much less risky strategy is to provide services for LEAs and schools for profit, and the Labour government has made clear that this is welcome. Indeed, the DFEE recently advertised in the national press for private companies interested in taking over part or all of the management of 'failing' schools and LEAs. The first LEA in line has been Hackney, which David Blunkett named as a 'failing' authority and sent in KPMG, the international management company, to sort out. Hackney's school improvement service will be privatised on July 1st, and its ethnic minority achievement service will be contracted-out next April (TES 14-5-99).
EAZs and government's moves to turn round failing schools and ineffective local authorities have created a market for management 'trouble-shooters'. Local authorities cannot meet the need because they have been drained of expertise by the enforced delegation of funding to schools, and this has created an opening for private sector intervention. Nord Anglia chief executive Kevin McNeany says 'In five years time it [private sector management] will be very big. There's a great need for people with proven track records and ideas' (quoted in TES 26-3-99).
EAZs provide fruitful opportunities for private companies to go into 'partnership' with LEAs and schools to provide management for profit. A leading example is Arthur Andersen, a partner in the Newham EAZ, and an international firm of accountants and management consultants with a worldwide annual turnover of £11 billion. Says Graham Walker, who heads Arthur Andersen's government services department, 'I believe that schools will be putting all their back office services [once mainly supplied by LEAs] into the private sector within a few years.' 'Everyone will want to earn a reasonable margin', he has said (TES 9-1-98), and has subsequently demanded that more money is allocated by EAZs for 'change management' in order to make its involvement in other Zones profitable enough (TES 4-9-98).
An indication of the confidence that the market has in the potential for profit in this area is that over the past three years education companies' shares have consistently out-performed the rest of the stock market. £1000 invested in education shares in 1996 is now worth £1593 (TES 19-2-99).
Profiting from the technological transformation of teaching
Developing information technology is one of the key elements in the EAZ project, and information technology companies are heavily involved in the Zones. BT is a partner in four out of the first 25 Zones: Barnsley, Herefordshire, Newham and Plymouth. RM (Research Machines) is in Basildon; IBM and ICL in Lambeth. Bull Information Services is a French company involved in two Zones, in Barnsley and Newham. The short-term objective of companies like these is to capitalise on the priority given to information technology in Labour's education programme. Mark Ballett, chair of Salford and Trafford EAZ, is managing director of Norweb Communications, and 'admits his company has a strong business incentive for getting involved' (TES Business links 5-2-99). One of the second phase of bids comes from Islington, led by the family trust set up by Research Machine's co-founder Michael Fischer (who is among Britain's 500 richest people), in partnership with Islington LEA. The trust will lead the zone and be the major sponsor, and also supply consultancy (TES 16-4-99).
The immediate opportunity for profit lies in supplying the technology, the software and the training for the National Grid for Learning. But this is just the first step in the long-term corporate agenda: the technological reform of teaching. For the information technology industry, schools are the last of the cottage industries. Writing of developments in the US, Doug Noble notes that
Corporate interest in brokering school reform and in penetrating substantial school markets now coincides as never before with the agendas of researchers of technological innovation.
...in this new decade, with its urgent attention to school reform, its massive cutbacks in state funding, and its general approbation of American business despite the recession, the welcome mat is out for widespread corporate intervention in education. The moment is especially ripe for renewed attempts by major corporate interests to transform the schools through advanced technology. (Noble 1998, p275).
The combination of Labour's prioritisation of information technology in the schools and its enthusiasm for private-public partnerships opens the door for the corporate profit-making agenda. In addition, two other features of Labour education policy pave the way for the business technology invasion. The first is its tendency to reduce teaching to technique. The second is the desire to save money by replacing teachers with computers and lower-paid classroom assistants. Margaret Hodge, the School Standards Minister, believes that
we should be thinking of employing fewer teachers, not more. Over the next few years information technology will revolutionise our schools. [...] In a few years, I believe, some classes will not be led by a fully trained teacher. [...] If pupils are working from lessons on the Internet, a trained classroom assistant may be as useful as a teacher. (New Statesman 22-5-98)
Business and power in the Zones
I have described the various objectives of business involvement in EAZs. To achieve them business needs influence over decision-making, and the constitution of EAZs provides it. The rhetoric of Zones is of partnership between school, home and community, but the reality is that classroom teachers and parents are marginalised in the composition of the Zone decision-making and executive bodies in comparison with business and management interests.
A typical example is the Salford and Trafford Action Forum, which has, according to its newsletter, 48 or 49 members. Its 18 schools have one representative each, the head or chair of governors. There are 2 places for teachers union representatives, though none in addition for classroom teachers representing their schools. There are just 2 places for parents. Business interests are represented by 4 managers and executives from the private sector, 2 from the TEC, and 2 from the EBP. The Chair is a chief executive of the information technology company Norweb Communications. The smaller Executive Board has a total membership of 13. 4 are headteachers, 4 are nominees of the Chief Education Officer, 2 are representatives of the private sector and 1 represents the TEC. There are no places for parents or classroom teachers. It is ironic that a project designed to combat social exclusion should itself be set up on a basis which excludes precisely those on whom effective action against social exclusion depends.
(There is a striking contrast between education and other areas of social provision and urban regeneration, where there are policies for and experiences of meaningful participation by local people. See for example the paper Developing effective Community Involvement Strategies, written by the Joseph Rowntree Foundation at the request of the Department of the Environment, Transport and the Regions, March 1999).
The dominance of management and business views which the composition of EAZ governance ensures is translated into an imposed consensus by the DFEE Code of Conduct for Action Forums (DFEE 1998). This recommends that a member of an AF should 'acknowledge that differences of opinion may arise in discussion of issues, but, when a majority decision of the forum prevails, it should be supported'; and should 'base his or her view on matters before the forum on an honest assessment of the available facts, unbiased by partisan or representative views...' (my emphasis). This would prevent the minority voices of teacher and parent representatives from challenging dominant views on behalf of those they represent.
However, even this does not satisfy the more aggressive schools-for-profit companies. They want complete control. McNeany of Nord Anglia is eager to see the Zones 'break the stranglehold of local authorities'. He argues that action zones would only be able to function effectively if school governors delegate almost all powers to the Forum. 'Local delegation of budgets and control hasn't really worked to an enormous extent because local authorities have been able to maintain considerable influence, if not control, over schools' (quoted in TES 27-3-98). An indication of the implications of private companies running schools was given by the Education Partnership, one of the bidders for King's Manor school in Guildford, which made clear that 'it did not want to be answerable to parents and councillors on the governing body' (Guardian Education 20-4-99).
How should we respond to the business agendas?
Business interests are increasingly penetrating and eroding what schools and LEAs do. They are markets for their products, vehicles for corporate image-building, sites of captive customers and suppliers of future workers. Business defines the purposes of school, shapes its curriculum, provides models to improve its management and technology to displace its teachers. Much of what business offers schools need, whether it is work placements for students or the latest information technology. But, as we have seen, educational interests and business interests do not necessarily coincide. Business may be more interested in taking money out of EAZs that putting money in. The crucial question is, when educational and business interests do not coincide, which will prevail? It is vital that we are clear about what is acceptable on educational terms, and what is not.
In some cases this is not so difficult. Public (i.e. state) schools, in EAZs or outside, should not be run by private companies for profit and any moves in this direction should be vigorously opposed. But in other cases, such as companies concerned with commercial sponsorship of school activities, with the management of schools and LEAs, and with the large-scale technologisation of teaching and learning, often as 'partners' of LEAs in EAZs, we urgently need to clarify the boundaries of what is in the interests of education. In the Zones themselves, where they exist, the best safeguard lies in strengthening the collective voices of teachers and parents both outside and inside EAZ decision-making bodies.
Finally, there is an aspect of business involvement in EAZs which has so far been rather neglected - its implications for the curriculum. If private companies choose to intervene in schooling for commercial purposes, they must expect their activities as a company to be critically examined for educational purposes. Some of the largest companies involved as partners in EAZs, including British Aerospace and Rolls Royce, are major arms exporters to oppressive regimes such as Indonesia and Saudi Arabia. McDonald's, a partner in the Weston-super-Mare Zone, would provide an interesting case study for environmental studies, as would IBM's employment practices for the new citizenship curriculum. The ability of teachers in Zone schools to make use, unhindered, of opportunities like these to develop students' critical understanding would provide a good test of whether educational interests are being subordinated to those of business.
Correspondence:
Dr Richard Hatcher, Faculty of Education, University of Central
England, Westbourne Rd, Birmingham B15 3TN.
Email: Richard.Hatcher@uce.ac.uk
Some of the material on business in this paper is taken from Hatcher R (1998) Profiting from Schools: Business and Education Action Zones, Education and Social Justice 1 (1) 9-16.
REFERENCES
DFEE (1998) The DFEE Handbook. London: DFEE.
Noble D (1998) The Regime of Technology in Education. In Beyer L E and Apple M W (eds) The Curriculum: Problems, Politics and Possibilities (2nd edition). New York: State University of New York Press.
Whitfield D (1999) Private Finance Initiative: The commodification and marketisation of education. Education and Social Justice 1 (2) 2-13.