Discussion paper

Understanding charter schools: are for-profit schools a good idea?

Schools New Zealand

This is the third and final installment of Maxim’s series of Research Notes on charter schools. Research Note 3: Are for-profit schools a good idea? interrogates whether for-profit operators should be allowed to operate schools under the Government’s proposed partnership school programme.

The NZ Government intends to pilot “Partnership Schools” (Kura Hourua) from 2014. Partnership Schools will receive public funds on a per-pupil basis, as with regular state schools, but will have more independence in terms of, say, curriculum, operating hours, employment and leadership structure. The initiative’s primary objective is to ameliorate New Zealand’s persistent problem with educational underachievement.

In terms of management, Partnership Schools may be run either not-for-profit or for-profit. One debate about the initiative in New Zealand, as overseas, is the proposed role of for-profit operators: should they be allowed to manage schools at all? There seems to be a general lack of clarity about what shape a for-profit Partnership School will assume. There are fears that we will see an industrial McDonald’s or IKEA-type chain of schools concerned only with profit. This conception leads to other objections, including the idea that for-profit operators will offer a cheap, low-quality education that maximises profits and does not deliver sufficient educational benefits, and the idea that they will draw profit from children at taxpayers’ expense. These critiques seem to proceed from the assumption: public, good; private, bad.

The purpose of this Research Note is to engage with such concerns and evaluate their soundness. We have done so with recourse to evidence from schools run for-profit overseas, particularly in the United States (US) and Sweden, and examine whether certain objections have explanatory, and not just rhetorical, force. From this analysis, it became evident that the educational success of for-profit operators—and the Partnership School programme in general—will hinge on creating the right regulatory and incentive structure. The structure must ensure both freedom and accountability, and we close with several recommendations that may balance both.

Other papers in this Maxim Institute series about Charter Schools in New Zealand are:




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