A Funding Revolution

As parents, teachers, and our nation’s children are adapting to greater marketisation of our education system it seems logical that we should seek to develop market philosophy so that it delivers on addressing the problems of rising inequality, mental wellbeing, and the problems of recruitment and retention.

The Texas Permanent School Fund was set up one year after the publication of Solomon Northup’s Twelve Years a Slave in 1854, with an initial endowment of USD $2m.  The fund is today worth over USD $36bn with investment profits being used to fund entirely the state’s primary and secondary schools. The Louisiana Education Quality Trust Fund followed some years later with the purpose of providing diverse educational enrichment programs; this fund is now worth over USD $1.2bn and since its inception has provided over USD $1.5bn in investment earnings.

“Over a long period of time, the main force in favour of greater
equality has been the diffusion of knowledge and skills.”
– Thomas Piketty

Now is the right time to develop a unique endowment fund that uses the best of market forces to help our comprehensive schools develop truly stunning and inspiring places for our young people.  Funding for the projects, exampled above, would come from the investment profits derived from the creation of an Educational Wealth Fund – an endowment fund that would preserve and grow the value of perpetuity capital while providing a sustainable income stream to fund exciting and inspirational projects in our state funded comprehensive schools. A fund that will be managed with the knowledge and foresight that the majority of its beneficiaries have yet to be born. The EWF would employ a regulated investment manager that would have full delegated authority for investment decisions according prescribed ethical investment policies.  Some projects may mean that schools will incur increased ongoing costs (such as increased maintenance); where these costs are deemed significant this could attract some transfer of funds by way of devolved endowments so that schools do not experience cash losses in the long term.

The number of wealth funds have increased dramatically in the last fifteen year with the majority of these designed exclusively for the purpose of increasing the capital wealth of their already wealthy investors. In the context of Thomas Piketty’s work on the projected rise of inequality and today’s deep connection between wealth and educational opportunity – now is the time to act.  The EWF seeks to build capital wealth with the sole aim of using this to build the foundations of greater human capital amongst those that need it the most. There is nothing like the EWF in the UK, or the world, in terms of vision or anticipated provision.