Foundation abandoned new school plan after taking £70m loan

CROYDON IN CRISIS: The decision to close Old Palace marked a rapid U-turn on all previous policy at the property-owning charity, according to documents obtained by this website.

Summed up in six words: an Old Palace School protester outside the Whitgift Foundation during half-term

As recently as last year, the Whitgift Foundation entered into a £70million loan facility to enable it to build a new school on Melville Avenue in South Croydon, but abandoned those plans at an emergency meeting in September and opted to close the Old Palace girls’ school instead, Inside Croydon has discovered.

Staff and some parents despair that the school may now be beyond saving. “They’ve crossed the Rubicon,” one source told Inside Croydon. “The Foundation has completely lost the trust of the staff and the parents. There’s few people who want to stick around now,” they said.

Inside Croydon has learned that since the end of September, when the closure decision was announced, more than 100 girls attending the 600-pupil school have left, seeking to continue their education in a more stable environment elsewhere.

The school had already been below capacity before the latest departures, which was one of the reasons given by the governors for their decision to close Old Palace.

Some teachers are also believed to have left, although the staff exodus is expected to begin in earnest from January, when the annual recruitment drive for the next school year gets underway.

Negotiations with staff groups continue over redundancy terms, possible redeployment at the other Foundation-run boys’ schools, Whitgift and Trinity, and also over what happens to the teachers’ daughters, many of whom have discounts on the £20,000 per year fees at a school that is to close in 2025.

Rumours persist that Trinity, in Shirley Park, which already has some girls in its Sixth Form, is looking to go fully co-educational. “But they won’t be looking for girls like we have at Old Palace,” according to the source.

Eye, eye: the Old Palace story made it into the pages of the nation’s best-selling fortnightly satirical magazine

“Take a look at Old Palace pupils – they don’t look like the pupils at any other private school.” They point to the 35% of Old Palace girls who receive bursaries towards their school fees and the high proportion of children from BAME backgrounds who attend.

The Whitgift Foundation is the Croydon property business which operates the three fee-paying schools, the almshouses and a care home, but which is haemorrhaging tens of millions of pounds a year because of the continuing delays over its £1billion property gamble to redevelop the town centre shopping area.

As the last issue of Private Eye magazine pointed out, few of the Year 7 girls who started at Old Palace in September this year will have been born when the Whitgift Foundation, aided and abetted by Boris Johnson and Tory MP Gavin Barwell, embarked on their misadventure with Westfield, the shopping centre developers.

A decade of dither and delay over the promised redevelopment has seen two separate planning applications, a public inquiry and the CPO-ing of much of Croydon town centre for the promised Westfield.

A massive development that was originally meant to be delivered by the end of 2017 remains in stasis: a new “masterplan” from the now French-owned Westfield was due to be unveiled this autumn. But last month, a senior figure at Unibail-Rodamco-Westfield let slip that that masterplan will now not be ready until 2025, and any completed development could be 15 years away.

It seems entirely possible that the latest Westfield slippage was influential in the Foundation governors’ decision to pull the plug on Old Palace.

Retirement plan: Old Palace head teacher Jane Burton

Certainly, the closure decision appears to have been taken abruptly, and represented a drastic change in direction. Some believe that Jane Burton, when she was appointed as Old Palace head in 2019, was recruited specifically to oversee the move to new premises. Burton announced before the start of this school year that she will retire next July.

Just days before the Foundation announced the school’s closure, they had been promoting an open day to recruit next year’s intake of pupils.

And over the course of the summer break, there was significant investment made in overhauling the school’s IT system and re-equipping all members of staff.

Inside Croydon has learned that the decision to close Old Palace School was taken at an extraordinary meeting of its “Court” of governors held on September 20. The decision was conveyed to the staff and then parents and pupils the following day. But sources suggest that despite the importance of the decision, not all of the Foundation’s governors were able to be present at the crucial meeting, and nor were they all necessarily made aware that such a course of action was even being considered.

According to the latest annual accounts of the Whitgift Foundation, lodged with the Charity Commission, seven of its 11 governors, including the chair, Trinity old boy Christopher Houlding, were appointed to the Court of Governors by the Archbishop of Canterbury.

Old Palace staff and parents regard Houlding and the governors as remote figures. “In the past two years, I don’t think we’ve seen any of the governors at the school, with the exception of the vicar and Bishop Rosemarie,” one said, referring to Canon Andrew Bishop, the Vicar of Croydon, and Dr Rosemarie Mallett, the Bishop of Croydon.

Dodger: Whitgift Foundation chair Christopher Houlding. Rarely seen at Old Palace

The last Houlding was seen at the school was for an emergency meeting held just before half-term when he was spotted “literally running away from a group of schoolgirls protesting outside the gates”, according to an eye-witness.

The Foundation announcement, reported exclusively by Inside Croydon, that the school will be forced to close in 2025 was made on September 21.

The Foundation said that the reasons for closure were that “the school has been struggling financially for many years”. There is no indication of such problems at the school to be found in the Foundation’s accounts.

In documents circulated at the school, and seen by Inside Croydon, the Foundation say that they have “looked at a variety of options to reverse or mitigate the trend [of declining rolls] at Old Palace”. They cite “bursery support”, building the Cathedral building in 2000 and acquiring Croham Hurst school in 2008 “with a view to improving facilities”.

It is this site, on Melville Avenue, where Old Palace has been operating its prep and primary schools. The senior school on its historic site in Croydon Old Town, with several listed Tudor buildings, is not regarded as suitable for expansion or redevelopment.

Aspects of it remain costly: the Shah Building, home to the Sixth Form, is reckoned to cost £500,000 per year to lease from the owners.

The Foundation document continues: “More recently, it commissioned a very detailed study looking into how it could build a completely new school on the Melville Avenue site, and last year secured external finance…”, the £70million loan, “… that would have provided most of the funding for such a project.”

This admission, too, suggests a very late reversal in the planning for the future of Old Palace.

“Unfortunately, the costs of this proposal were such that the new school would have needed to attract over 50% more pupils than at present to break even, and more again to generate enough funds to repay the interest on the borrowing, and the market analysis suggested this would be difficult to achieve.” And they only discovered this after taking out the multi-million-pound loan?

“The risk of taking this step in the face of the evidence would have been enormous and it was not something the governors felt they could do.”

Under a cloud: part of the senior school estate, scattered around Old Town

The next section, coming from the organisation whose development plans have condemned central Croydon to four decades of development blight, might be considered by some to be a bit… well, rich.

“As a charity that has been in existence for over 425 years, the Foundation is aware of the need to make strategic decisions for the future which will secure its long-term viability for the local community.” Oh, how we laffed!

“Where funds are provided by the Foundation to finance new school facilities, each project needs to be considered carefully… The lack of financial surplus at Old Palace has therefore limited the ability to make substantial new investments over the years.

“While it could be argued that there should be subsidies from the boys’ schools, it is important to stress that fee-paying parents at those schools would expect to see their fees reinvested in the school their child is at and not reallocated elsewhere.” Which some might suggest all sounds very business-like, and hardly at all charitable. Nor very Christian.

Elsewhere, the Foundation excuses the lastminutedotcom nature of its announcement. The closure was announced two weeks after the start of the school year, when more than 80 sets of parents and carers had committed their daughters’ educational future to Old Palace by joining in Year 7, only to discover within days of the new term that they would soon need to find new places for them at other schools, many of which are already fully subscribed.

The document includes what almost amounts to an admission by the Foundation that it deliberately misled parents and carers into sticking with the school. “Any prior suggestion that the school faced an uncertain future would have led to an immediate loss of confidence and precipitated the very thing that the Foundation were trying to avoid.”

And they claim: “The truth is that the Foundation was fighting to the end to find a way forward – after much consideration, research and consultancy, the final decision to close was only made the day before the announcement.”

Read more: Old Palace parents threaten legal action over school closure
Read more: Old Palace closure brought on by shaky Foundation finances
Read more: Falling rolls and rising fees: how Old Palace got squeezed


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2 Responses to Foundation abandoned new school plan after taking £70m loan

  1. Richard Garvey says:

    Can’t really agree that “There is no indication of such problems at the school to be found in the Foundation’s accounts”. The accounts aren’t broken out school by school but you can see that, overall, the cost of providing education (can’t remember how it’s labelled) was less than the fee income. You already hit the nail on the head in your post “Falling rolls…” on 22 September.

  2. Aaron Strutt says:

    Shame on the Whitgift Foundation. I live on Melville Avenue and every time I drive past the school I find it almost unbelievable that a charitable foundation would knock down a school and build houses on the site. Surely they could have sold of some of the other land they own or most of the land, car park and derelict swimming pool in Melville Avenue. I honestly think the Whitgift Foundation should hang their heads in shame. They are an utterly disgrace.

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