Controversy over Covid loans to private schools

  • 11th January 2023

Private schools received more than £157 million from the government in subsidised loans during the Covid-19 pandemic, under a scheme unavailable to state schools, openDemocracy has reported.

The independent schools include the alma matres of several government ministers including that of the chancellor Jeremy Hunt – Charterhouse, which charges up to £44,000 a year per pupil, and received a £5 million Covid support loan to help with “any short-term cash flow issues” – despite declaring total income of almost £45 million for 2020-21, the financial year in which it claimed the loan.

The Coronavirus Business Interruption Loan (CBIL) scheme was introduced to help those “adversely affected by the pandemic”. Recipients were forgiven the first year’s interest and the government guaranteed 80% of the loan to encourage the banks to lend.

A spokesperson for the Independent Schools Council said discussions with the Department for Education at the start of lockdown were to resolve uncertainty around funding, adding: “There was no lobbying of government beyond asking for clarification on what financial schemes, if any, independent schools qualified for. CBILs were explicitly available for charities – including independent schools – affected by the pandemic, and were designed to assist with cash flow. The criteria for the loans were clear and the lender would not have granted the facility if it were not necessary to overcome the operating difficulties of the pandemic.”

Labour’s shadow schools minister Stephen Morgan said: “The public will rightly question why schools raking in tens of millions of pounds in income each year were able to secure interest-free loans footed by the taxpayer when state schools have seen their funding slashed over the past decade by the Conservatives.”

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