New curbs on venture capitalist-owned schools

Sweden plans to curtail venture capital firms running publicly funded, privately managed free schools, Education Minister Jan Björklund said on Thursday.

New curbs on venture capitalist-owned schools

“We can’t outlaw profits, because then no one will want to run free schools. Profits have to be allowed,” he told The Local, weighing in on the contentious “welfare profits” debate which has even divided the political opposition.

“Most corporations that run free schools in Sweden work very well,” he added, explaining that ideal free school owners are companies that “have a long-term and serious interest in running schools and have competence in the subject”.

The announcement that the government planned tougher rules for free school ownership came in the wake of the bankruptcy of JB Education, one of Sweden’s largest operators of free schools that is owned by Danish venture capital firm Axcel. Björklund said it was “a clear example of how it shouldn’t work”.

“We had a venture capital company that didn’t know much about education taking over Swedish schools. They thought they’re going to make big money, discovered it wasn’t easy, got tired quickly, and quit,” Björklund told reporters. “In my opinion, that sort of behaviour is totally unacceptable. I don’t want to see that happen again in Sweden where we have an owner that is so short-sighted.”

Back in June, JB Education, which had been a pioneer in Sweden’s free school movement, declared bankruptcy. Earlier this week, it emerged that the firm had debts of more than 1 billion kronor ($154 million).

To prevent the situation from happening again, the government plans to introduce a bill that will “radically change” Sweden’s free school regulations. The first reform involves a tougher review of companies before they are allowed to take over free schools, a change in line with one of the main suggestions put forth earlier in the year by a government-appointed free school committee.

“They can’t just be judged on the number of qualified teachers they have. We also have to look at their long-term commitment,” Björklund said.

While the new rules won’t rule out venture capital firms from owning Swedish free schools “by definition”, it will “in practice” make it impossible for most venture capital firms from running free schools, Björklund said.

“Often the whole idea is going in and making an operation more profitable in the short-term and then selling it for a huge profit. Companies based on the business model will be ruled out,” said Björklund.

A second change will be the implementation of an “education guarantee” so that students who have started an education programme have right to finish it even if their current school shuts down. Exactly how that would happen remained to be reviewed before the government introduce its new bill.

David Landes

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Schools in Sweden discriminate against parents with Arabic names: study

Parents with Arabic-sounding names get a less friendly response and less help when choosing schools in Sweden, according to a new study from the University of Uppsala.

Schools in Sweden discriminate against parents with Arabic names: study

In one of the largest discrimination experiments ever carried out in the country, 3,430 primary schools were contacted via email by a false parent who wanted to know more about the school. The parent left information about their name and profession.

In the email, the false parent stated that they were interested in placing their child at the school, and questions were asked about the school’s profile, queue length, and how the application process worked. The parent was either low-educated (nursing assistant) or highly educated (dentist). Some parents gave Swedish names and others gave “Arabic-sounding” names.

The report’s author, Jonas Larsson Taghizadeh said that the study had demonstrated “relatively large and statistically significant negative effects” for the fictional Arabic parents. 

“Our results show that responses to emails signed with Arabic names from school principals are less friendly, are less likely to indicate that there are open slots, and are less likely to contain positive information about the school,” he told The Local. 

READ ALSO: Men with foreign names face job discrimination in Sweden: study

The email responses received by the fictional Arabic parents were rated five percent less friendly than those received by the fictional Swedish parents, schools were 3.2 percentage points less likely to tell Arabic parents that there were open slots at the school, and were 3.9 percentage points less likely to include positive information about the municipality or the school. 

There was no statistically significant difference in the response rate and number of questions answered by schools to Swedish or Arabic-sounding parents. 

Taghizadeh said that there was more discrimination against those with a low social-economic status job than against those with an Arabic name, with the worst affected group being those who combined the two. 

“For socioeconomic discrimination, the results are similar, however, here the discrimination effects are somewhat larger,” he told The Local. 

Having a high economic status profession tended to cancel out the negative effects of having an Arabic name. 

“The discrimination effects are substantially important, as they could potentially indirectly influence parents’ school choice decision,” Taghizadeh said.

Investigating socioeconomic discrimination is also important in itself, as discrimination is seldom studied and as explicit discrimination legislation that bans class-based discrimination is rare in Western countries including Sweden, in contrast to laws against ethnic discrimination.”