Independent schools are spending more money on bursaries for poor pupils than on scholarships awarded to the most able, the first time this has happened, a financial survey has revealed.
Private schools appear to have reacted to warnings that they need to widen access to protect their charitable status. In the past, money has been invested in scholarships to give cut-price places to bright pupils, regardless of their parents' ability to pay, as schools compete to attract the most gifted children.
But a survey of 501 schools by accountancy firm Horwath Clark Whitehill shows a major shift took place last year, with more than pound;100 million spent on bursaries for pupils from poorer backgrounds. The change follows scrutiny of private schools as the Charity Commission finalises its guidance on public benefit tests, due by the end of the year.
Schools are expected to have to prove they are open to more pupils from poorer homes to keep their charitable status, which gives the sector annual tax breaks worth pound;100m.
In 2007, pound;200m was given out in scholarships and bursaries by those surveyed, including some of the UK's biggest day and boarding schools. Just over half the money was spent on bursaries.
The report, Benchmarking Financial Performance in Independent Schools 2008, says: "This is a significant movement, and appears to reflect a genuine willingness by the sector to address the issue of widening access in the area of financial means. Although it is early days, there is clear evidence of a significant shift from scholarships towards means-tested bursaries.
"There is also evidence to suggest that the number of pupils in receipt of fee support is reducing, suggesting that the support is being targeted at those who need it most."
The move towards means-tested bursaries began before the commission began looking at private schools. But Stuart Westley, master of Haileybury, near Hertford, said changes at his school were prompted by the commission's focus.
For the past three years, the amount of fee assistance given in scholarships has been limited to 10 per cent for any pupil, down from 50 per cent six years ago. Pupils in receipt of means-tested bursaries can now have 100 per cent of their fees paid by the school, where boarding fees reach pound;25,305 a year. Some 10 per cent of pupils now receive some means-tested discounts.
"Like all schools, we are limited in the number of pupils we can help," said Mr Westley. "We are trying to increase that number, but we probably did need the guidance of the Charity Commission to encourage us.
"Schools are reluctant to give their competitors an advantage, and that includes attracting the most talented pupils."
Jonathan Cook, general secretary of the Independent Schools' Bursars Association, said: "The Charity Commission interest has focused the attention of schools. Now they are looking more closely at whether they can means-test, while still wanting to attract the best pupils."
From next year, all schools with charitable status will have to write an annual report for the commission to explain what they have done to meet the public benefit tests. It is likely to look positively on those directing more money towards means-tested discounts on fees.
The report also shows schools are continuing to enjoy successful fundraising campaigns. Income from donations in 2007 reached pound;81.6m in those surveyed. Twenty-one schools raised more than pound;1m, and a further 50 raised more than pound;200,000.
But the suggestion that more school fundraising can pay for a widespread expansion in means-tested bursaries is unrealistic. This is especially true in the short term as money would need to be invested to receive longer-term gains. To fund five pupils at a school with fees of pound;10,000 a year would require an endowment of about Pounds 1m, the report says.
"There is simply no evidence that these sums are achievable, at least not in most schools," it adds.