Amid concern among fee-paying schools about the threat to their charitable status from the Goverment’s new charities Bill, Dulwich plans to set up and run a £20 million city academy in East London.

The boys’ school will manage the academy. A financial sponsor, whose identity has not yet been disclosed, will invest up to £2 million in the project in return for £18 million of government funding. The college, in southeast London, is expected to send plans for the academy to the Department for Education for a decision by ministers next month.

Graham Able, Master of Dulwich College, told The Times: “It would be a Dulwich academy but we would not be putting money in. Someone else will be putting the money in and we will be doing the management and quality control. With our expertise of quality control of schools overseas, it is a natural thing for us to be interested in.”

Dulwich is fast establishing itself as an education brand in Asia, having already set up a school in Thailand and planning to open one in China in August. The Dulwich College International School in Shanghai is led by Colin Niven, who taught Tony Blair French at Fettes College in Edinburgh. A second Dulwich college will open in 2005 in the city of Suzhou in China’s Jiangsu province.

Dulwich’s decision to run a state school here is a boost for ministers, who see academies as central to raising standards in inner cities. This month Charles Clarke, the Education Secretary, urged private schools with large endowments to “recapture the purpose” for which they were founded by doing more to help poor students.

Under the policy, private sponsors invest £2 million in return for £18 million of government funding to create schools in areas where comprehensives are failing. Academies act as state-funded independent schools, with funding directly from Whitehall. They have more freedom than other state schools over curriculum and staffing. Twelve have opened.

• Four sixth-formers were expelled from Eton College at the weekend after traces of cannabis were found in their hair in a random drugs test, it was reported last night.

  The pupils had come forward to say they had smoked cannabis in the past and had agreed not to take drugs again, and to undergo drugs counselling and random tests, according to The Sun. The cannabis found in their hair dated from before they confessed to their drugs use, it was said.

  No one at the school was available for comment last night.

  THE BENEFITS OF CHARITY
  
  

• A law from 1891 allows schools to be registered as a charity and entitled to tax concessions worth about £82 million a year
  
  
• The status means schools get 80 per cent relief on business rates, gross interest on savings in bank accounts, are exempt from capital gains tax and get tax relief on donations
  
  
• The abolition of charitable status could mean school fees rising by up to a third
  
  
• The only test of public benefit is when schools register with the Charity Commission. The Government wants to ensure they provide “public benefit”
  
  
• Independent schools claim to give away about £200 million in aid with fees every year but would not be able to do so if they lost charitable status
  
  
• The Independent Schools’ Bursars Association says independent schools save the Exchequer £1.7 billion by educating 600,000 pupils

  DEBATE

  Do private institutions need charitable status?
  
  Send your e-mails to debate@thetimes.co.uk

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