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Business-Managed Democracy

“Business-managed democracies are those in which the political and cultural arrangements are managed in the interests of business”

Sharon Beder

Business-Managed Education

Privatising Schools

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There has been a major push for the private provision of educational services in many countries. Schooling is progressively being turned into a profit-making commercial venture. In the process the quality of education is being eroded. An early step in this process has been the introduction of business management structures into education, along with the elimination of many of the functions and professional services provided to schools for free by government education departments. This has opened the way for “a host of private agencies, consultants and professional firms” to fill the gap on a commercial basis.

According to the UK's National Union of Teachers (NUT) general secretary Christine Blower:

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Those who run and manage schools should be education professionals with a public service ethos, not educational companies whose bottom line is serving the interests of their shareholders. Children and young people are not commodities; they are entitled within school to know that those who run and manage their school have purely their educational interests at heart.

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Private provision has occurred at three levels: supplementary services such as catering and cleaning; private consumption services provided outside of school hours, such as tutoring, educational software and after school care; and core education, such as managing or operating schools.

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Degrees of Privatisation

cover of Business Week At the extreme end of the privatisation spectrum are schools that are run as businesses for profit. The extent to which for-profit schools are publicly funded varies, but in the US charter schools are almost completely funded by government. In other countries a public abhorrence of for-profit education, combined with a scepticism on the part of the business community that profits can be made from running schools, has ruled out for-profit schools.

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In Australia private schools are not for-profit, nor are they totally government funded. However they get as much as 80 per cent of their funding from government.

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Similarly in Canada, private schools get up to half their funding from the government.

In the UK, schools that are almost totally funded by government are being run by private sponsors and the boards they appoint. Those sponsors may be businesses. In this way UK academies and trust schools only differ from US charter schools in that they cannot be run for profit.

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Some Different Types of Schools


Type Funding Management Regulation
Public Schools government government or outsourced to private company curriculum, testing regime, employment practices, admissions regulated
Academies (UK) £25m+ government & £2m private private sponsors & board mainly appointed by sponsors can set own employment practices, admissions policy, and curriculum (in compliance with national requirements)
Trust Schools (UK) government & unspecified private contrib. private trust & trust appointed board as above
Charter Schools (US) government & private donations private/ can be run for profit can set own employment practices, admissions policy, and curriculum
Private Schools (Australia/ Canada) government & private fees private can set own employment practices, admissions policy, and curriculum

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Trade in Services

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The WTO has become a promoter and enforcer of privatised educational services through the General Agreement on Trade in Services (GATS). Although GATS allows governments to keep control of public services, if those services are not totally provided by the public sector, they are not defined as public services. So countries which have both private and public schools cannot claim school education as a public service. If education services are opened to international trade under GATS – and this is subject to negotiation between nations – then foreign providers of education must be treated the same as domestic providers, with access to the same subsidies and grants, unless an exception is granted by the WTO. Disputes are decided by a panel of trade lawyers.