Running fit to cope with recession

The recession is forcing families and schools alike to re-evaluate their finances and question whether certain projects or outlays are really necessary. Parents are said to be sacrificing holidays, a second car or delaying home improvements, in order to afford school fees at a time of rising unemployment.

Schools, in their turn, are assumed to be cutting back on big capital programmes. The ‘arms race' of recent years has seen prestigious and wealthy independent schools vying to build world class concert halls and sports pitches with which to impress prospective parents.

Now head teachers are keen to stress that the quality of teaching is what really sets them apart from the state sector, not the fancy facilities. Yet school managers say, counter-intuitively, that it might be a good time for schools to expand or embark on a new building programme.

A good time to borrow

Nicholas Marten, chairman of the Independent Schools' Bursars Association (ISBA), which held its conference recently in Torquay, says: "There is still scope for schools to develop their facilities, if it's part of a structured development plan. It's a good time to be borrowing money because the rates are so low. The rates charged by builders are also very good at the moment."

But he concedes: "Our parents are buying in for a good quality of education - schools need to make sure that is maintained, even if that means it's another year before the science block is refurbished."

Jonathan Cook, the ISBA's general-secretary, comments: "In the immediacy, some schools' capital projects will go ahead as they are already committed two or three years ahead. But it's right to say people will be reassessing their priorities."

The Independent Schools Council (ISC) published its annual census results last month. It showed fees had risen 5.9 per cent in the last year, despite the economic downturn. Parents are forking out an average termly fee at a day school of £3432, rising to an average £7747 at boarding school, it found.

Yet a third of pupils, almost 170,000 students, receive help with fees - a rise of six per cent on 2008 - putting an extra strain on schools' finances. This demand is expected to rise again next year, while schools are unlikely to risk a substantial fee increase.

Capital expenditure in independent schools was an eye-watering £794 million in 2007/8. Almost half of this was used on creating new buildings, according to the ISC census, with more than £1500 spent per pupil.

En-suite facilities

Nearly £100 million was spent on refurbishing boarding accommodation, as boarding schools try to shake off their fusty image of draughty dormitories and scratchy blankets. Many now offer individual bedrooms with en suite bathrooms for older children.

After pouring money into capital projects in recent years, it raises questions about whether schools will be able to continue in the same vein. However, education magazines are still packed with adverts from firms hoping to win contracts to build impressive facilities to improve schools. These include swimming pool designers and manufacturers, synthetic pitch suppliers, and sports hall architects.

Others are tapping into heads' fears about the recession by advising schools to build dual-use sports centres that can be let out to businesses or organisations. One advert boasts of a recent school project where a new sports hall was built, containing a rowing room, dance studio, badminton courts and specialist climbing wall, with a changeable floor so it can be used for exams and assemblies.

Barnard Castle School, set in its own 50-acre estate in County Durham, is reportedly planning a multi-million pound refurbishment. A new science and IT block opened last year and its plans over the next five years apparently include a two-storey cricket pavilion, new swimming pool, sixth-form centre and prep school main hall.

Tightening the purse-strings

The ISC census report, however, hinted that schools would be tightening the purse-strings: "Evidence of the economic downturn that we now face was not available when schools would have drawn up their capital expenditure plans."

Also, heads have said schools would be unlikely to increase their fees considerably in September, but would prepare for prudent times. Nick Dorey, chairman of the Society of Heads of Independent Schools, said recently: "I doubt that there is a single independent school in the country that isn't thinking very seriously about what might happen in the future, to ensure that they are running fit to cope with anything that might come.

"Many are thinking carefully about investment in large new buildings, about staffing levels, and class size options available to them."

But it appears that some schools do not intend to allow the recession to interfere with expansion, and perhaps see it vital to remain competitive at a time when parents may turn to the nearest grammar school to save on school fees. Whether they will be saved by the tentative green shoots of recovery spotted in some markets, or suffer from the lag that independent schools normally experience in a recession (being the last to suffer and last to recover) remains to be seen.

Find out how the head of Brighton College is planning to tackle any downturn in numbers come September.