Exclusive: Revealed - Tory plan for firms to run schools for profit

Controversial proposal blocked by Lib Dems but is expected to appear in 2015 Conservative manifesto

Private companies would be able to run state schools for profit under a plan to be published by Conservative modernisers which could be introduced if the party wins the next general election.

Michael Gove, the Education Secretary, has told friends he has no objections to "for profit" firms setting up the free schools independent of local authority control he has pioneered since 2010. The controversial idea has been vetoed by the Liberal Democrats, who fear it would be seen as back-door privatisation of the education system. It will not be implemented before the 2015 election, but is now seen as a front-runner for inclusion in the Tory manifesto.

Bright Blue, a modernising pressure group regarded as David Cameron's natural ally, will propose the move in a book to be published next week calling for the Coalition's public service reforms to be extended through an injection of market forces.

Although Mr Gove hopes that almost 200 free schools will be opened by September, the book argues that his revolution needs a boost to create more places in good schools. "The rhetoric does not match the reality," it says, adding that only 24 free schools were set up in the last academic year.

"Relying on not-for-profit organisations and parent groups, which have limited funds, when Government's capital spending is constrained, is not enough," Bright Blue says. "The for-profit sector can play a role here, providing the money to get new schools set up."

The book admits: "It will be important, of course, to convince the public that this does not stem from an ideological position: that somehow private is better than public and Tories are pursuing privatisation in awe of money-making. This is not true. This is a sensible, hard-headed policy which provides alternative funding sources to boost diversity and ultimately quality of education in this country, while – and this should be said time and time again – ensuring state education remains free at the point of use."

According to Bright Blue, some profit-making schools in the US, Chile and Sweden have improved attainment. "The idea that commercial activity rots children's souls, regurgitated by the anti-capitalist political left, belongs in the Dark Ages," it argues.

"For-profit state schools are an example of applying Conservative means – faith in markets and competition – to deliver progressive ends – better free education for children with parents who lack the resources to give their children the best education."

However, the book acknowledges the political risks. "Our motives need to be trusted," it says. "We have to show why our ideas are more compassionate: that we are motivated by our hearts as well as our heads. That we're looking out for the less fortunate, not just the gifted and talented. Our opponents demonise us: we have to prove them wrong."

Bright Blue says that "bolder" use of market forces is not "privatisation" because it does not involve selling assets. Public services would still be state funded and free at the point of use. It insists that payment-by-results for private firms could prevent "cherry-picking" and ensure people with the most severe needs are helped most.

To raise school standards, the modernisers propose more "mixed-age classrooms, where children are taught by ability rather than age". Pupils would not move up a year unless they attained basic standards. Other ideas include localised pay throughout the public sector; this has also been blocked by the Liberal Democrat leader Nick Clegg, who believes it would widen the North-South divide.

The book warns that childcare is "too expensive" for "a significant minority of parents" who should be offered loans to be repaid only if their income reached a certain level. "Many Tories need to drop the ideological baggage about working women and start applying Conservative, market-based solutions to this vital period of education," it says.

Ryan Shorthouse, director of Bright Blue and co-editor of the book, Tory Modernisation 2.0: the Future of the Conservative Party, told The Independent: "To secure a second term in government, the Conservative Party has to now relaunch the modernisation project. Deficit reduction and partnership with the Liberal Democrats has blown modernisation further off course, refuelling unfair stereotypes about Tories.

"Historically, Conservatism has been at its best when it is open-minded and big-hearted, providing ladders of opportunity for people from ordinary backgrounds. So the focus from now on needs to be helping these families with the cost of living and better public services."

Bright Blue is a 2,000-strong group whose advisory board includes Theresa May, the Home Secretary; Maria Miller, the Culture Secretary; and David Willetts, the Universities minister.

Future is bright blue: Think tank's plans

Tory modernisers' blueprints for public-service reforms include:

* Allowing profit-making companies to run state schools, which would still be free at the point of use

* More state-school pupils to be taught in mixed-age classes and not allowed to move up a year until they attain certain standards

* Localised pay introduced throughout the public sector, and made performance related

* Moving more government bodies out of London to Northern cities

* Enabling private companies to hire and pay prisoners

* Ending the cap on student places so that universities can recruit as many undergraduates as they want

* Giving all homeowners the right to extend their home by one storey without planning permission

* Extending the student loans scheme to postgraduates

Suggested Topics
Arts and Entertainment
Gregg Wallace in Summer's Supermarket Secrets
tv All of this year's 15 contestants have now been named
Sport
The giant banner displayed by Legia Warsaw supporters last night
football Polish side was ejected from Champions League
Arts and Entertainment
Could we see Iain back in the Bake Off tent next week?
tv Contestant teased Newsnight viewers on potential reappearance
News
i100(and it's got nothing to do with the Great British Bake Off)
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
News
news It's not just the world that's a mess at the moment...
News
Angelina Jolie with her father Jon Voight
peopleAsked whether he was upset not to be invited, he responded by saying he was busy with the Emmy Awards
News
Bill Kerr has died aged 92
peopleBill Kerr appeared in Hancock’s Half Hour and later worked alongside Spike Milligan and Peter Sellers
Life and Style
A picture taken on January 12, 2011 shows sex shops at the Paris district of Pigalle.
news
Sport
footballPremiership preview: All the talking points ahead of this weekend's matches
News
Keira Knightley poses topless for a special September The Photographer's issue of Interview Magazine, out now
people
Voices
The Ukip leader has consistently refused to be drawn on where he would mount an attempt to secure a parliamentary seat
voicesNigel Farage: Those who predicted we would lose momentum heading into the 2015 election are going to have to think again
Arts and Entertainment
Cara Delevingne made her acting debut in Anna Karenina in 2012
film Cara Delevingne 'in talks' to star in Zoolander sequel
News
i100
Sport
Mario Balotelli pictured in his Liverpool shirt for the first time
football
Life and Style
tech
Independent
Travel Shop
the manor
Up to 70% off luxury travel
on city breaks Find out more
santorini
Up to 70% off luxury travel
on chic beach resorts Find out more
sardina foodie
Up to 70% off luxury travel
on country retreats Find out more
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Java Developer - 1 year contract

£350 - £400 Per Day: Clearwater People Solutions Ltd: Our client based in Cent...

Junior Analyst - Graduate - 6 Month fixed term contract

£17000 - £20000 Per Annum Bonus, Life Insurance + Other Benefits: Clearwater P...

SAS Business Analyst - Credit Risk - Retail Banking

£450 - £500 per day: Orgtel: SAS Business Analyst, London, Banking, Credit Ris...

Project Manager - Pensions

£32000 - £38000 Per Annum Bonus, Life Insurance + Other Benefits: Clearwater P...

Day In a Page

Ukraine crisis: The phoney war is over as Russian troops and armour pour across the border

The phoney war is over

Russian troops and armour pour into Ukraine
Potatoes could be off the menu as crop pests threaten UK

Potatoes could be off the menu as crop pests threaten UK

The world’s entire food system is under attack - and Britain is most at risk, according to a new study
Gangnam smile: why the Chinese are flocking to South Korea to buy a new face

Gangnam smile: why the Chinese are flocking to South Korea to buy a new face

Seoul's plastic surgery industry is booming thanks to the popularity of the K-Pop look
From Mozart to Orson Welles: Creative geniuses who peaked too soon

Creative geniuses who peaked too soon

After the death of Sandy Wilson, 90, who wrote his only hit musical in his twenties, John Walsh wonders what it's like to peak too soon and go on to live a life more ordinary
Caught in the crossfire of a cyber Cold War

Caught in the crossfire of a cyber Cold War

Fears are mounting that Vladimir Putin has instructed hackers to target banks like JP Morgan
Salomé's feminine wiles have inspired writers, painters and musicians for 2,000 years

Salomé: A head for seduction

Salomé's feminine wiles have inspired writers, painters and musicians for 2,000 years. Now audiences can meet the Biblical femme fatale in two new stage and screen projects
From Bram Stoker to Stanley Kubrick, the British Library's latest exhibition celebrates all things Gothic

British Library celebrates all things Gothic

Forthcoming exhibition Terror and Wonder: The Gothic Imagination will be the UK's largest ever celebration of Gothic literature
The Hard Rock Café's owners are embroiled in a bitter legal dispute - but is the restaurant chain worth fighting for?

Is the Hard Rock Café worth fighting for?

The restaurant chain's owners are currently embroiled in a bitter legal dispute
Caribbean cuisine is becoming increasingly popular in the UK ... and there's more to it than jerk chicken at carnival

In search of Caribbean soul food

Caribbean cuisine is becoming increasingly popular in the UK ... and there's more to it than jerk chicken at carnival
11 best face powders

11 best face powders

Sweep away shiny skin with our pick of the best pressed and loose powder bases
England vs Norway: Roy Hodgson's hands tied by exploding top flight

Roy Hodgson's hands tied by exploding top flight

Lack of Englishmen at leading Premier League clubs leaves manager hamstrung
Angel Di Maria and Cristiano Ronaldo: A tale of two Manchester United No 7s

Di Maria and Ronaldo: A tale of two Manchester United No 7s

They both inherited the iconic shirt at Old Trafford, but the £59.7m new boy is joining a club in a very different state
Israel-Gaza conflict: No victory for Israel despite weeks of death and devastation

Robert Fisk: No victory for Israel despite weeks of devastation

Palestinians have won: they are still in Gaza, and Hamas is still there
Mary Beard writes character reference for Twitter troll who called her a 'slut'

Unlikely friends: Mary Beard and the troll who called her a ‘filthy old slut’

The Cambridge University classicist even wrote the student a character reference
America’s new apartheid: Prosperous white districts are choosing to break away from black cities and go it alone

America’s new apartheid

Prosperous white districts are choosing to break away from black cities and go it alone