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In September 2005, fifty prominent
independent schools An independent school is independent in its finances and governance. Also known as private schools, non-governmental, privately funded, or non-state schools, they are not administered by local, state or national governments. In British En ...
in the United Kingdom were found guilty of operating a fee-fixing cartel by the Office of Fair Trading. The OFT found that the schools had exchanged details of their planned fee increases over three academic years 2001–02, 2002-03 and 2003–04, in breach of the Competition Act 1998. The
Independent Schools Council The Independent Schools Council (ISC) is a non-profit lobby group that represents over 1,300 schools in the United Kingdom's independent education sector. The organisation comprises seven independent school associations and promotes the busine ...
– a lobby group funded by the independent schools in question – said that the investigation had been "a scandalous waste of public money".


Evidence

Emails showed that the schools were routinely swapping information about their costs and intended fee changes, as often as four to six times a year as part of a '' Sevenoaks' Survey''. The investigation was prompted by the September 2003 leak of emails to '' The Times'' by two Winchester College pupils. Sent by Bill Organ, Winchester College's
bursar A bursar (derived from "bursa", Latin for '' purse'') is a professional administrator in a school or university often with a predominantly financial role. In the United States, bursars usually hold office only at the level of higher education ...
at the time, to the Warden of the college, they contained details of 20 schools' fees and the phrase: "Confidential please, so we aren’t accused of being a cartel".


Arguments in support of the schools

The
Independent Schools Council The Independent Schools Council (ISC) is a non-profit lobby group that represents over 1,300 schools in the United Kingdom's independent education sector. The organisation comprises seven independent school associations and promotes the busine ...
felt that the action was disproportionate. It was argued that sharing information was common amongst charities (as the schools are classified) and that the aim was to keep fees as low as practicably possible. Until 2000, when the Competition Act 1998 displaced the Restrictive Trade Practices Act 1976, the practice was legal as the schools were exempt from the anti-cartel laws that apply to businesses. Jean Scott, the head of the Independent Schools Council, said that independent schools had always been exempt from anti-cartel rules applied to business, were following a long-established procedure in sharing the information with each other, and that they were unaware of the change to the law (on which they had not been consulted). She wrote to John Vickers, the OFT director-general, saying, "They are not a group of businessmen meeting behind closed doors to fix the price of their products to the disadvantage of the consumer. They are schools that have quite openly continued to follow a long-established practice because they were unaware that the law had changed." Jonathan Shephard, Chief Executive of the ISC, stated: "This is a
Kafkaesque Franz Kafka (3 July 1883 – 3 June 1924) was a German-speaking Bohemian novelist and short-story writer, widely regarded as one of the major figures of 20th-century literature. His work fuses elements of realism and the fantastic. It ty ...
situation... the law seems to have changed without Parliament realising – and without the independent sector being consulted – contrary to the government's own strict guidelines on consultation. Schools are now being held liable for breaking a law which no-one knew applied to them". He added: "The OFT's broad assertion that sharing information produced higher fees is highly contentious."


Schools involved

*
Ampleforth College Ampleforth College is a co-educational independent day and boarding school in the English public school tradition located in the village of Ampleforth, North Yorkshire, England. It opened in 1802 as a boys' school, it is situated in the grou ...
*
Bedford School :''Bedford School is not to be confused with Bedford Girls' School, Bedford High School, Bedford Modern School, Old Bedford School in Bedford, Texas or Bedford Academy in Bedford, Nova Scotia.'' Bedford School is a public school (English ind ...
*
Benenden School Benenden School is an independent boarding school for girls in Kent, England, in Hemsted Park at Benenden, between Cranbrook and Tenterden. Benenden has a boarding population of over 550 girls aged 11 to 18, as well as a limited number of day ...
*
Bradfield College Bradfield College, formally St Andrew's College, Bradfield, is a public school (English independent day and boarding school) for pupils aged 11–18, located in the small village of Bradfield in the English county of Berkshire. It is note ...
*
Bromsgrove School Bromsgrove School is a co-educational independent day and boarding school in the Worcestershire town of Bromsgrove, England. Founded in 1553, it is one of the oldest public schools in Britain, and one of the 14 founding members of the Headmast ...
*
Bryanston School Bryanston School is a public school (English independent day and boarding school for pupils aged 13–18) located next to the village of Bryanston, and near the town of Blandford Forum, in Dorset in South West England. It was founded in 1928. ...
*
Canford School Canford School is a public school (English independent day and boarding school for pupils aged 13–18). Situated in 300 acres of parkland near to the market town of Wimborne Minster in Dorset, south west England, it is one of the larges ...
*
Charterhouse School (God having given, I gave) , established = , closed = , type = Public school Independent day and boarding school , religion = Church of England , president ...
*
Cheltenham College ("Work Conquers All") , established = , closed = , type = Public school Independent School Day and Boarding School , religion = Church of England , president = , head_label = Head , head = Nicola Hugget ...
*
Cheltenham Ladies' College Cheltenham Ladies' College is an independent boarding and day school for girls aged 11 to 18 in Cheltenham, Gloucestershire, England. Consistently ranked as one of the top all-girls' schools nationally, the school was established in 1853 to pr ...
*
Clifton College ''The spirit nourishes within'' , established = 160 years ago , closed = , type = Public schoolIndependent boarding and day school , religion = Christian , president = , head_label = Head of College , hea ...
*
Cranleigh School Cranleigh School is a public school (English independent day and boarding school) in the village of Cranleigh, Surrey. History It was opened on 29 September 1865 as a boys' school 'to provide a sound and plain education, on the principles o ...
* Dauntsey's School * Downe House School *
Eastbourne College Eastbourne College is a co-educational independent school in the British public school tradition, for day and boarding pupils aged 13–18, in the town of Eastbourne on the south coast of England. The College's headmaster is Tom Lawson. Ove ...
* Epsom College * Eton College *
Gresham's School Gresham's School is a Public school (United Kingdom), public school (English Independent school (United Kingdom), independent Day school, day and boarding school) in Holt, Norfolk, Holt, Norfolk, England, one of the top thirty International Bac ...
* Haileybury School * Harrow School *
King's School, Canterbury The King's School is a public school (English independent day and boarding school for 13 to 18 year old pupils) in Canterbury, Kent, England. It is a member of the Headmasters' and Headmistresses' Conference and the Eton Group. It is Britain's ...
* Lancing College *
Malvern College Malvern College is an independent coeducational day and boarding school in Malvern, Worcestershire, England. It is a public school in the British sense of the term and is a member of the Rugby Group and of the Headmasters' and Headmistresses ...
* Marlborough College * Millfield School * Mill Hill School * Oakham School *
Oundle School Oundle School is a public school (English independent day and boarding school) for pupils 11–18 situated in the market town of Oundle in Northamptonshire, England. The school has been governed by the Worshipful Company of Grocers of the City ...
*
Radley College Radley College, formally St Peter's College, Radley, is a public school (independent boarding school for boys) near Radley, Oxfordshire, England, which was founded in 1847. The school covers including playing fields, a golf course, a lake, an ...
* Repton School *
Royal Hospital School ) , established = 1694 Royal Charter1712 Greenwich1933 Holbrook, Suffolk, Holbrook , type = Public school (UK), Public School Independent school (UK), Independent day and boarding School Royal Foundation , founders = William ...
*
Rugby School Rugby School is a public school (English independent boarding school for pupils aged 13–18) in Rugby, Warwickshire, England. Founded in 1567 as a free grammar school for local boys, it is one of the oldest independent schools in Britain. ...
* St Edward's School, Oxford * St Leonards-Mayfield School *
Sedbergh School Sedbergh School is a public school (English independent day and boarding school) in the town of Sedbergh in Cumbria, in North West England. It comprises a junior school for children aged 4 to 13 and the main school for 13 to 18 year olds. ...
* Sevenoaks School *
Sherborne School (God and My Right) , established = 705 by Aldhelm, re-founded by King Edward VI 1550 , closed = , type = Public school Independent, boarding school , religion = Church of England , president = , chair_label = Chairman of the governors , ...
* Shrewsbury School * Stowe School *
Strathallan School Strathallan School is an independent boarding and day school in Scotland for boys and girls aged 7–18. The school has a campus at Forgandenny, a few miles south of Perth. School roll The school has 73 full-time staff, and 18 part-time staff ...
* Tonbridge School * Truro School *
Uppingham School Uppingham School is a public school (English independent day and boarding school for pupils 13-18) in Uppingham, Rutland, England, founded in 1584 by Robert Johnson, the Archdeacon of Leicester, who also established Oakham School. The headmas ...
* Wellington College *
Wells Cathedral School Wells Cathedral School is a co-educational independent school located in Wells, Somerset, England. The school is one of the five specialist musical schools for school-age children in the United Kingdom, along with Chetham's School of Music, the ...
* Westminster School * Winchester College *
Woldingham School Woldingham School is an independent school for girls, located in the former Marden Park of outside the village of Woldingham, Surrey, in South East England. It is a Roman Catholic school and a member of the global Network of Sacred Heart Schoo ...
*
Worth School Worth may refer to: Places In the United States: * Worth, Georgia * Worth County, Georgia * Worth, Illinois * Worth Township, Cook County, Illinois * Worth Township, Woodford County, Illinois * Worth Township, Indiana * Worth Township, Michigan * ...
* Wycombe Abbey School For Truro and Sedbergh Schools, the OFT's preliminary findings are that they took part in the Sevenoaks Survey in only two of the three years investigated.


Resolution

The OFT released a 500-page statement which was summed up thus: However, on final publication this was changed to: The response to the OFT investigation was co-ordinated by the Independent Schools Council's Chief Executive, Jonathan Shephard, with a negotiating team including Lord (Nicholas) Lyell, the former
Attorney General In most common law jurisdictions, the attorney general or attorney-general (sometimes abbreviated AG or Atty.-Gen) is the main legal advisor to the government. The plural is attorneys general. In some jurisdictions, attorneys general also have exec ...
; the solicitor and mediator Tony Willis, and the businessman
Sir Bob Reid Sir Robert Paul Reid (born 1 May 1934) was Chairman of the British Railways Board from 1990 until 1995. Early life Reid was educated at the University of St Andrews and has a graduate degree from European Business School London. Career He join ...
. One of the principal aims of the negotiation was to ensure that financial payments by the schools should go to a charitable trust rather than to the Treasury: this followed a United States example where a sportswear firm had agreed to provide sports facilities in settlement of a competition law claim. The ISC negotiating team wanted the charitable trust to benefit children from disadvantaged backgrounds, but OFT insisted on the fund benefiting pupils from the 50 schools at the relevant time. All the schools involved were given fines of £10,000 each for their infringement, with a 50% reduction to £5,000 for Eton and Winchester for early co-operation. Additionally the schools agreed to pay £3 million into a trust fund aimed to benefit the pupils attending the schools during the period involved; it has been stressed that the trust fund is not a fine. The schools paid in equal instalments over five years, finishing in 2010, with an average cost of about £70,000 each. Broadly speaking, the payments were approximately 0.7% of the relevant turnover during the years of the infringement. The low percentage is largely down to the fact that the change to the law was not notified to schools. Additionally, the settlement was on the basis that all 50 schools accepted the settlement proposal. The impact of the OFT's case on day and boarding fees set subsequently by the schools has been analysed. Research indicates that resolving the case had an insignificant impact on fees levels, though independent school fees may have increased faster during the OFT investigation due to fears of possible future regulation.


References

{{reflist Independent schools in the United Kingdom Cartels 2005 in British law 2005 in the United Kingdom History of education in the United Kingdom