ISC independent schools support a striking £9.5 billion gross value added contribution to Britain’s GDP – larger than the City of Liverpool, or the BBC.
They support 227,000 jobs, one for every two pupils and generate £3.6 billion in tax revenues, according to analysis by Oxford Economics, the global economics consultancy.
They also make annual savings for the tax payer of £3.0 billion – equivalent to building more than 460 new free schools every year. The high standards of academic achievement shown by ISC school pupils are estimated to contribute an additional annual £1.0 billion to GDP.
This is the first time that the contribution of the independent schools’ sector to the British economy has been subject to objective analysis. ISC schools have long been recognised for their educational excellence, but this report demonstrates the extent of their support for and contribution to the British economy.
Key highlights show that:
• The 1,205 ISC schools in Britain support a £9.5 billion gross value added contribution to Britain’s GDP. By way of comparison, this is larger than the size of the economy of the city of Liverpool and also exceeds the BBC’s gross value added contribution, estimated recently at £8.3 billion.
• ISC schools support 227,200 jobs across Britain, equivalent to one in every 122 people in employment. Every 2.1 pupils at an ISC school support one person in employment in Britain.
• ISC schools generate £3.6 billion in tax revenues for the Exchequer, equivalent to £133 for every household in Britain.
• For every £1 that schools contribute to the British economy, they generate 98p in the rest of the British economy through the supply chain and wage consumption impacts. This means that the independent sector has the same multiplier effect as the pharmaceutical industry.
• Projecting these results to the entire independent sector (so as to include those schools which are not ISC schools) produces an estimated contribution of £11.7 billion to GDP, 275,700 jobs and tax revenues of £4.7 billion.
ISC commissioned global consultants, Oxford Economics, to quantify the impact of independent schools, focusing particularly on ISC schools. The report looks at three dimensions of economic impact:
– Contribution to GDP, employment and national tax revenues made by independent schools
– Savings to the taxpayer by not having to provide state-funded education for ISC pupils
– Additional value to the British economy arising from high standards of academic performance by independently-educated pupils
Further highlights demonstrate:
Savings to the taxpayer
• The 1,205 ISC schools in Britain educate approximately 470,000 pupils who are entitled to, but do not take up, a place at a state school. This results in an annual saving to the taxpayer of £3.0 billion – the equivalent of building more than 460 new free schools each year.
• Projecting these results for the entire independent sector produces an estimated annual saving to the taxpayer of £3.9 billion, or more than 590 new free schools each year.
Value-added contribution to GDP
• Recent studies have highlighted the link between educational performance and economic output at a national level. Applying these studies to the performance of pupils at ISC schools in Britain results in an estimated additional annual contribution to GDP of £1.0 billion. Scaling up for the entire independent sector produces an estimated additional annual contribution to GDP of £1.3 billion.
• The report highlights the role independent schools play in supporting strategically important and vulnerable subjects: science, technology, engineering, mathematics, modern foreign languages and quantitative social sciences. These subjects are vital to the UK’s competitiveness and its international relations but their supply is either weak or falling, jeopardising the UK’s growth prospects. “It has long been the case that the independent schools sector delivers proportionately more students with better STEM related A-levels than the state sector. Without these well qualified applicants many university STEM courses would face serious recruitment difficulties.” Professor Sir Michael Sterling, former Vice-Chancellor of the University of Birmingham and former Chairman of the Russell Group
The report also looks at the wider contribution ISC schools make to their local communities. In some areas, our schools are the only major employer – for example, Millfield School in Street in the South West, Giggleswick School in North Yorkshire and Sedbergh School in Cumbria.
There are schools, such as Portsmouth Grammar School which are the mainstay of major arts and music festivals, to which thousands of visitors flock. There is King’s School, Canterbury whose sports centre is the city’s main leisure centre and which has been awarded a Centre for Excellence for cancer and stroke patients and is part of a GP referral scheme. There are schools, such as Yarm School in Yorkshire and Dixie Grammar in the Midlands, whose theatres offer the only entertainment hub for their communities. As Raymond Jones , Vice Chair of Giggleswick Parish Council comments: “Giggleswick is immensely important to the life of the community. It offers a real cultural lifeline to people who would otherwise not have these opportunities open to them.”
There are the schools playing a leading role in renewal and regeneration, such as Newcastle-under-Lyme School and other schools whose building or maintenance projects have helped local companies survive the recession.
There are also our schools who make specialist educational provision for children with special needs. Our schools provide centres for specialist expertise and training for both state and independent teachers and are also able to provide places to local authorities who may not be able to fund an entire specialist school.
Barry Huggett, Headmaster of More House School, Frensham commented: “Independent schools for children with special educational needs play a hugely important role in the country’s educational landscape. The schools provide centres for specialist expertise and skills and are also able to offer places to local authorities, who may not be in apposition to fund an entire specialist school for the children in its area.”
Other of our specialist schools, such as The Royal Ballet School and Tring Park School for the Performing Arts, provide world class music and dance education, producing talent including Darcey Bussell, Jonathan Cope and Nicola Benedetti, that draws international acclaim to this country.
Sam Moore, Chief Operating Officer, Oxford Economics commented:
“By generating tax revenue, supporting jobs and stimulating economic activity along its supply chain, the impact of the ISC independent schools sector is shown to extend well beyond its core function of delivering an excellent all round education to pupils. Our research clearly demonstrates the significant contribution that a large and successful sector can make to the economy as a whole.”
Matthew Burgess, General Secretary, Independent Schools Council commented: “For the first time, the independent schools’ sector has commissioned a rigorous analysis to understand the extent and significance of our impact on the British economy. While our schools have been long recognised for their educational excellence, we can now see how important our schools are in stimulating growth and employment, in contributing our fair share of tax and supporting local economies and communities across the country.”