The End of an Era. Taaleem takes over Jebel Ali School. Not-For-Profit Status Comes to an End. Taaleem and Jebel Ali Reveal the Impacts on Children, Parents, Fees, Debentures and Teachers
The acquisition of Jebel Ali School by Taaleem marks the first time that a Not for Profit (NFP) school has been converted to a for-profit school in the UAE.
While those most closely involved do not see the other NFPs following suit, at least in the immediate future, clearly the acquisition establishes an important precedent for education in the region. It represents a significant change for the school – but also, potentially, calls into question many of the accepted views of profit and not-for-profit schools held by many parents, students and educationalists across UAE education.
Will the result actually be a better school? Will parents and children be impacted by the decision? What does the change to being a not-for-profit really mean in practice? Have we been looking at not-for-profits through rose coloured spectacles?
SchoolsCompared spoke to those involved in the negotiations over the last eight months to discover exactly why the acquisition has taken place, and to see what they think the impact on students, parents and the broader community will really be.
During the course of the interview SchoolsCompared.com spoke to:
- Lizzie Robinson, Principal, Jebel Ali School
- Alan Williamson, CEO, Taaleem
- Sam Truman, COO, Taaleem
SchoolsCompared.com: Mr Williamson, can you just talk us talk us through where we are?
Alan Williamson, CEO, Taaleem: We were first approached about challenges facing Jebel Ali school eight months ago. And the the challenge being the rent that is required to be paid. I met Tarek, the Chairman of the Jebel Ali board. It was clear to both sides that we share many values. He knows Taaleem, and specifically that our shareholding is 56% owned by government entities, and we are, if you like, the nearest thing to a not for profit schools group that is actually for profit. We shared our thinking on a possible partnership, which would involve taking ownership of Jebel Ali school. We spoke about the challenges around the not-for-profit status of the school, and whether an acquisition was even possible. Since then, there’s been a lot of work involved between us – between Taaleem, the Jebel Ali school board, and the regulators. And then there has been a long and fruitful, and amicable, negotiation with the landlord, Emirates REIT.
We have come to a financial agreement with Emirates REIT, which involves the acquisition of the land and the buildings of Jebel Ali school. This will conclude on the transaction date for the school itself, and will end the fairly extensive liability on the school board. Jebel Ali school will become an independent LLC will become part of the Taaleem portfolio of British curriculum schools.”
SchoolsCompared.com: How much did you buy the land for?
Sam Truman, COO, Taaleem: Until the transaction is completed, we can’t disclose the figure and the figures will be public knowledge. RERA have just changed their policy of making all land transaction details to be public record.
Alan Williamson: We bought the land, and the building, and indeed all liability, which can be seen in the arbitration agreements. It will be public knowledge but right now we cannot disclose the details because we haven’t signed the deal with Emirates REIT. But it can be broken down into the land and building and the ending of the arbitration against the Jebel Ali school board.
[Since the interview Emirates REIT has disclosed that Taaleem is paying 185.5 million AED for the land and buildings, the valuation given to it by one of the REIT’s independent valuers, Cushman & Wakefield, as of 31 December 2021. In addition Taaleem has agreed, on behalf of Jebel Ali School, to settle the school outstanding liabilities towards the REIT for an amount of AED 48 million. Taaleem have paid 233.5 million AED in total.]
SchoolsCompared.com: Did you pay anything for the school itself?
Alan Williamson: We paid for the land, and buildings, with a remainder to be interpreted as either the liability that the school owes to Emirates REIT, or as the purchase price of the school. This sum of money will eventually be disclosed and become public knowledge.
[Note: Since the interview took place, Taaleem has taken on the additional cost of having to pay back 1,400 debentures. While the education group had been able to continue with the debentures ‘as is’, it has been instructed to pay back the debentures over five years (paying back one fifth each year) and will not be able to take new debentures. Given current debentures had been invested by the school, this represents a significant increase in the acquisition cost for Taaleem.]
SchoolsCompared.com: So Taaleem has acquired a school, a very good school, by, essentially, paying off its debts…
Sam Truman: Until we are able to disclose the price it’s hard to for us to articulate exactly how this is structured.
SchoolsCompared.com: It’s just obviously the case that, with this transaction, which involves a not-for-profit school, there is no one person, or people, or even a company, to actually pay money to is there?
Alan Williamson: In that respect, you’re right. I mean, we are not giving the ruler’s court a sum of money to acquire the school.
SchoolsCompared.com: This is the first time a not-for-profit school has become a for-profit profit school in the history of UAE education. Do you foresee other NFPs becoming for-profit? Could this be the start of a future where there are no not-for-profit schools in Dubai?
Alan Williamson: I don’t think so. I have a huge respect for Dubai College, for DESC and for JESS. These are really the three remaining schools and, in my opinion, they have always been excellent. They are thriving schools. The JAS board were a primary school with historic issues and wanted to move to a much larger building with land, which has created the financial challenges it has. JESS, DC, and DESC did not have these issues, so I don’t see these schools therefore needing to become for profit.
SchoolsCompared.com: Is there a difference between for-profit schools and not-for-profit schools?
Alan Williamson: I love that question. Dubai British School Jumeirah Park, is a thriving school, but everybody in the community knows it is a for-profit school. However, Taaleem needed to spend a lot of money on the land and buildings while having a small first cohort [and therefore correspondingly small revenue]. Expenses (notably staffing) are more reflective of where the school will be . As a result the school could not immediately be profitable. It takes at least nine years for a school like this to become so. In this regard, many Taaleem schools are, strictly speaking, “not for profit”.
SchoolsCompared.com: That’s kind of different. An investor with deep pockets, who has the money, will look at a long term stable revenue stream, which is why they would invest invest their capital in a school. So I think let’s park that. I am more interested in terms of the values and experience for parents? Are they different? Will they change.
Alan Williamson: No. I strongly believe that there’s not a difference in the experience for parents or students, and I have worked in both sectors.
SchoolsCompared.com: How is that possible when there are no shareholders in a not-for-profit so automatically they have 25 to 30% more of their revenues to spend on staff, infrastructure and so on – the return in other words the shareholders would look for?
Alan Williamson: In daily life you could survey the parents of Dubai British School, Nord Anglia Dubai, NLCS or a Kings’ School, and and ask them if their children feel valued? Whether the pastoral care is incredible? Whether the standard of education is incredible? Whether the results and academic achievement are incredible? They will, by and large, all say ‘Yes!’. They will say they love their schools, that their school is ‘excellent’. That the teachers are ‘amazing’… I don’t honestly believe that a King’s parent or a DBS parent, or a child more importantly, will speak a different language to that of the JESS parent, Dubai College parent or the DESC parent.
SchoolsCompared.com: Ms Robinson, do you think there is something here that does not stack up? We know that not-for-profits spend more operationally, as a percentage of their total revenues, than for-profits. We also know that not-for-profits generally charge the same, or more, than equivalent for-profit schools. So how can it be that parents “cannot see the difference” between a not-for-profit and a for-profit school? Surely that must mean that parent’s money in a not-for-profit school is somehow being wasted, or disappearing, in paying for things that make no difference to parents or children? Where is that money?
Lizzie Robinson, Principal, Jebel Ali School: I have not worked in for-profits, but our mantra has always been that every single penny that we make will go back into the child. That’s been how we justify every single decision that we make. We are very tight with our budget – we have to be. We are very aware that we’re spending parents’ hard earned money.
As a not-for-profit, we go through all of the same strict decisions and rules that for-profit schools do in terms of financial decision making. Spending for us, as a not-for-profit, was, and had to be, justified by being brought back to the needs of the child. And our decision has then to also be agreed by our governing body.
SchoolsCompared.com: But do you agree, as Alan says, that for parents and students, there is actually then no difference between not-for-profits and for-profits? Parents pay the same, or even more, at a not-for-profit, but students get the same quality and experience of education, not anything different.
Lizzie Robinson: What I do know just from the short time that I’ve been working with Taaleem is that our values are extremely aligned. We all want exactly the same thing – to get the very best for the child. As far as I can see, NFPs and FPs just have slightly different ways of getting to the same outcome.
Alan Williamson: There is an assumption that the shareholder is aggressively for-profit. In fact, shareholders within education are often people who believe as passionately as anyone about education – as much so, or sometimes more, as the boards of not-for-profit schools. Don’t also forget, not-for-profits will also run a budget where they invest back into the school – so not all money coming in, in other words, is spent operationally.
Fundamentally, and in all honesty, whilst shareholders and boards are important, a school is more often defined by its principal, its teachers, its ethos and values. Maybe Taaleem is slightly different to some other school groups in this regard in that it is decentralised. While we do have a corporate office, and we do have shareholders, our schools are run differently and feel very different from each other. We give our principals autonomy, because they’re on the ground and they know best how the school should run.
SchoolsCompared.com: How do you expect parents to react to the news, Ms Robinson, that Jebel Ali School is no longer a not-for-profit?
Lizzie Robinson: I think what’s important to remember here is that not much is going to actually change at the school. We are going to carry on behaving in the same way, valuing people in the same way, pushing for excellence in the same way. When parents see this, and get that reassurance, then see the investment in the sports, and so on, I think they will even be excited at the change to being a for-profit. Inevitably, there will be an initial reaction: We know that many parents have told us over and over again that they’ve chosen us specifically because are (were) a not-for-profit. But over time…
Alan Williamson: If anything parents will see more investment going into the school. Hopefully, and very possibly, the only thing that parents will reflect on is the enhanced education their child will get. The teachers in Jebel Ali school are clearly delivering a fantastic education – one rated so by the KHDA. But Taaleem is no weaker than Jebel Ali in the core subjects of English, Mathematics and Science in our inspection outcomes. Moreover some of our schools are stronger in areas like Arabic and Islamic Studies. We all know this has an impact on overall inspection outcomes. We believe that Jebel Ali’s current fantastic Director of Arabic will now be able to network with our teams at Taaleem and, in so doing, help move Jebel Ali to an overall Outstanding rating. This is the only area really where the school needs to move forward and we can help here.
SchoolsCompared.com: So will there be a changes financially, or in other areas, in how Jebel Ali school will be run under Taaleem?
Alan Williamson: There will be no changes to staffing which is the biggest cost for a school. In the first year there will be no changes to salaries or to contracts. Of course, staff may choose to stay or go. But there will be no changes to the terms and conditions of the teachers and school board.
SchoolsCompared.com: What about after the first year?
Alan Williamson: I couldn’t answer that question even for an existing Taaleem school – you cannot plan that far ahead. We can’t predict the economy. We can’t predict what will happen with inflation. We simply do not know what the regulator is going to do with school fees. But we do guarantee to the teachers in Jebel Ali School their contract for the next year. That’s something that Lizzie was passionate about, right from the early days of discussions.
SchoolsCompared.com: What about the broader sense of an education? What about all those things that JAS offers on a day-by-day basis – its extra and co-curricula activities, for example. Will there be any changes?
Alan Williamson: I would expect not. I don’t want to over-promise, but actually I think, if anything, what we are hoping and expecting is that there will be more investment from Taaleem in Jebel Ali school. I expect to see this in both capital investment and staffing. If anything, then, we expect the parents at Jebel Ali school to see Taaleem actually investing in the school.
Sam Truman: Let me clarify this. We have actually committed to a four-year campus improvement project at JAS. This will see us upgrading the facilities in a way that, because of the budget constraints Jebel Ali School faced, it could not undertake. It will be a considerable sum of money, and it will be invested in consultation with the Jebel Ali leadership team. They will help guide us on how facilities should be upgraded.
Alan Williamson: JAS is already, if you strip out the REIT costs, a profitable school. Taaleem will remove these costs.
One of the positives we hope is that Jebel Ali school staff, parents and its community will see a richness that comes with being part of a school group. There will be ECAs that operate at DBS, for example, that we can offer the Jebel Ali school community. For teachers too, there will be a rich community for networking opportunities, whether you’re a Mathematics Year 3 teacher, physics teacher…
Lizzie Robinson: The move to Taaleem, for JAS staff, means more promotion possibilities. We’ve got some outstanding members of staff but, given we are a smaller, independent school, opportunities for them to grow have been limited. We have real movers and shakers in terms of future leaders within Taaleem.
SchoolsCompared.com: You personally, however, have decided not to stay? Why?
Lizzie Robinson: I am not staying only because of recent personal changes in my life. A challenging family situation has arisen that will require me to spend more time in the UK.
SchoolsCompared.com: But you’re sad not to be joining?
Lizzie Robinson: I am very sad, yes. Jebel Ali has been very close to my heart. It has the most incredible ‘magic.’ And I hear, when I speak to colleagues at Taaleem, that they talk about their school in the same way – so this will be the joining of two forms of magic. Joining with Taaleem is an exciting proposition. But I have plates spinning in my personal life, and I’m not able to spin all of these at the same time. I need the flexibility to go back and forth to the UK a lot more.
SchoolsCompared.com: A primary concern for parents in a situation like this is that there should be no change to the DNA of the school. It’s obviously a real shame that you’re leaving, because it is often the leader that provides this continuity. How will Taaleem be able to ensure that the DNA, what makes JAS special, is not lost?
Alan Williamson: The leader is so important, and the leader is Lizzie. But I’m sure Lizzie will tell us that there’s leadership at all levels of a school. And the majority will stay. In my engagement with the school, I’ve been impressed with people like the secondary head teacher, who is just amazing. JAS has three or four of my staff from my former company, Kings’, who are fantastic teachers.
Lizzie Robinson: There is a thread throughout the whole school. I have worked hard to ensure that staff respect each other; that they have the confidence to take decisions; that we give people the wings to fly. When I read the next principal’s bio, the principal that will follow in my footsteps, I could see he is an absolute match in terms of how he likes to run things. He is as passionate as I am. If I could have picked someone to run the school in my place, it would have been him.
Alan Williamson: In terms of the DNA, all our schools have their own values. We don’t have a model. Dubai British school Emirates Hills has a slightly different heartbeat than Dubai British School Jumeirah Park, which, in turn, will have a different heartbeat to Jebel Ali school. I actually want to answer the question by saying that I, as the CEO, don’t want Jebel Ali school to become a Taaleem school. I passionately want it to stay Jebel Ali School. Parents will not see ‘Jebel Ali School by Taaleem’ or Taaleem Jebel Ali. We do not put our brand in the name. It is school that is the entity, and its brand is the one that matters.
SchoolsCompared.com: Are you expecting any parents to leave?
Alan Williamson: I don’t want any parents to leave and I can’t see a reason for anyone leaving. Yes, I know that is controversial: The school will no longer be a not-for-profit, and that is important to some parents. But to balance that, we have discussed the nature of Taaleem, its values, and its shareholders. We have talked about how Taaleem sits between the not-for-profit world and the for-profit world. I also believe parents will welcome the financial security that Taaleem will bring to Jebel Ali. On top of this, if the teachers stay, if the school is seen to be maintaining its current values, if the JAS magic doesn’t disappear, if Lizzie’s departure is not seen as a sign of change, then why would parents want to go? Yes, there will, possibly, be a small group of parents that are uncomfortable with a for-profit ownership structure and that there are now shareholders. There’s no doubt that parents value that status in DC, DESSC and JESS and, currently, Jebel Ali. But I think parents most value being in a school where there is magic, being in a school that evidences values they believe in, and where their children are, ultimately, happy. These are what truly matter.
SchoolsCompared.com: Many parents will be suspicious in the school’s change to now having shareholders – and profit margins. This may well be an even more sensitive issue for Jebel Ali School, because of its move from being resolutely not-for-profit. Parents may now look behind every decision to question why, and where, their money is going. How do you get over this?
Alan Williamson: I want to answer this question by going back to the land and rent. If this transaction hadn’t taken place, eventually, Lizzie would have been under incredible pressure to deliver on the land and building REIT bill that was legally due. The leadership would have had to deliver a much greater efficiency in how they ran the school. The rent in other words would have have almost ended up in the same percentage as would go to the shareholders. So, what is the difference? When Not-for-profits build a sports hall, or a beautiful admin block, it also has to be paid for.
SchoolsCompared.com: You have run your eyes through the current Jebel Ali School budget and costs in a granular way. What are you going to change in terms of efficiencies? What have you seen that you could remove from budget lines? Or is it literally going to run in exactly the same way?
Alan Williamson: If anything, and I need to be careful, when I first spoke to Lizzy about the school, she spoke to us about the need for investment. Lizzie and the team wanted investment, but if we’re honest, couldn’t deliver it because of their financial situation.
SchoolsCompared.com: Yes. I understand that investment is needed – and that Taaleem will now carry out this investment over time. But then there are also operational costs which affect the school on a day to day level. What I am asking is whether these are going to be reduced in any way.
Alan Williamson: I think, if anything they will be enhanced.
Sam Truman: There will be economies of scales of our supply chain, and efficiencies we can deliver through that. You know, we’re operating a huge number of schools. There might be annual maintenance contracts that we leverage from other partners. There are insurance costs, and other costs like these, which, because we have 17 school at the moment, soon to be 23, we can leverage economies of scale.
The school has done really well pre Taaleem. Before we make any big changes we would, and will, consult with the school. A Taaleem central office is not going to be landing and saying you need to change all of your suppliers on day one. Everything has been, and will be done, in consultation, as it will also be with the staffing.
SchoolsCompared.com: So, if you’re genuinely not changing any of the costs, then the school can’t change too much?
Alan Williamson: That is exactly what I am saying. We will be looking at new staffing coming into school. We need to be transparent about that. But we will honour all of the new staffing that Lizzie has recruited on their current terms. For new staff, not this year, but new staff going forward, we will, naturally recruit on Taaleem salary scales. But given that we run two outstanding schools on these [lower] salary scales, that parents love, this is no impediment to achieving excellence. I think we all agree it can be very good to have a mix of fresh, dynamic, energetic staff stay, some of whom stay 3-4 years, and others who stay up to 25. Bear in mind Lizzie is already running a profitable school if you exclude its land and building costs. The profit she is already making will help pay back our huge investment.
SchoolsCompared.com: Do you expect to any staff to leave?
Lizzie Robinson: I hope not. I think that the connection and connectivity of the staff will be strong enough to go through a change process. We might have some staff, who, much like some of the parents, don’t feel that it’s a good school decision for them. But, hopefully, we will retain most of our staff, because, essentially, the feeling when you walk into school will be exactly the same.
Alan Williamson: Any change brings uncertainty. Parents will will hopefully see that the change is, if anything positive. But we do know that some teachers, like some parents, are rightly, or wrongly, only at the school because it is a not-for-profit.
SchoolsCompared.com: The senior leadership team are aware of the acquisition. What has their reaction been, Lizzie?
Lizzie Robinson: Inevitably, it was a shock in the first instance. And then, when they started to actually unpack what it might mean, in the way that we have today, there was some excitement about things like: ‘Okay, this could mean a promotion activity or an opportunity’; ‘Okay, this can mean that our CPD can take on a different route…’ And, it has to be said, the financial security of the school is something that, we all recognise needed to be addressed.
SchoolsCompared.com: Had staff been aware of the financial issues facing Jebel Ali School and been concerned then?
Lizzie Robinson: Of course, yes. Jebel Ali School is a very, very special place. And we believe passionately in what we do. And we wanted to make sure that that we could continue. So staff knew we were exploring solutions.
SchoolsCompared.com: How much have parents and staff been aware of the liability that been sitting on top of the school?
Lizzie Robinson: They have been aware that we’ve been in a rental dispute for some time. There has been continuing communication regarding how we have been trying to find a route through that. We’ve put our faith in the governing body to find a solution. And we have at times spoken to the ruler’s court, and the KHDA has been aware of this. So we’ve never, ever given up trying to find a solution. You know, Jebel Ali is one of Dubai’s oldest schools, and we always believed that we would find a solution. And we now have.
Alan Williamson: I suppose one of the positives, for us, is that the leadership of the school have kept that dream alive. And you can see that in enrolment. You know, the school is actually thriving and prospering. Something is going very, very, very right at Jebel Ali school. This is a tribute to Lizzie, and the team, who have together run such a successful school despite being under all these pressures. In all honesty, I hope now that at least some teachers say: ‘Phew, that means we’ll finally get that Science Lab upgraded. We’ll finally get those library books we need.’
SchoolsCompared.com: Would you go as far as to say some staff actually feel relieved that, with the agreement with Taaleem, their jobs have now been secured?
Alan Williamson: Maybe. I don’t think though that JAS teachers felt their jobs were not secure. But…
Lizzie Robinson: We are very honest with staff. When we did a pay cut during the pandemic, which everyone is aware of, we had to explain why. We explained that the model upon which the school was due to grow, didn’t come to fruition. We explained, openly, that our modelling was built on criteria that the secondary school would fill up straightaway. But it didn’t. We had modelled on the basis that school fees in secondary would rise. They didn’t. So we’ve always been transparent with our community about where we were financially, and the pressures that we faced. And we have also openly talked about the high cost of staffing. Staffing is our biggest cost. You know, we’ve always been incredibly proud of the fact that our teacher turnover has been relatively low – and that we have some members of staff that have been at JAS for 25 years. And that is always something that is a huge attraction to parents coming in. So, yes, of course, it’s been stressful. But we’ve never, ever, believed that we wouldn’t find a solution. That wasn’t an option. We’ve just kept going.
Every single member of our community is clear on the vision and they live that. To the letter, day in, day out, no matter where they work in the school. They’re all incredible. And I would invite anyone to come and do a drop off duty with me in the morning. All of our children come up and say, ‘Hello, Mr. Rogers, how are you?’ They have this wonderful, quiet, polite confidence that I’ve just never seen in any other school. Not to say it doesn’t exist in other schools. It’s just I’ve never seen it. Our children are incredible. And our parents are remarkable, as are our staff. I think that’s now going to go from strength to strength. It’s going to be a good partnership with Taaleem. And we’re going to be able to do things that we haven’t been able to do before. That’s a good thing.
Sam Truman: I think that there’s one other key issue. As we have said, we will make sure that salaries are protected for one year. But we’re also making sure that each teacher’s gratuity is protected as well. And, as you mentioned, there’s some members of staff that have been with JAS for a long time. Taaleem have the financial resources to make absolutely sure that those gratuities are protected.
Alan Williamson: There should be a feeling of security.
Sam Truman: They don’t have to worry about their 13 years of service – or longer. Gratuities are being fully protected under the new partnership.
SchoolsCompared.com: So, to be clear, there will be no new contracts. The existing contracts, in full, will just be transferred?
Sam Truman: No, that is not right. The new Jebel Ali contracts have been issued this week. And that’s a mutual agreement that we we have come to. New contracts are being issued, but they have the same contractual terms for next year.
SchoolsCompared.com: So when will the contracts change?
Alan Williamson: There’s a technicality there. Taaleem sits under the Ministry of Immigration. So, in September 2023, the contracts will transfer to the Ministry of Immigration.
Sam Truman: So, in year one, the contract is continuing with the gratuity and all terms exactly as they are now. If anything were to change, in the following years, anything up to this point would be transferred as is, and any changes would only affect the contract going forward. We’re not saying what may, or may not, happen going forward. If we do change terms, these will arise from the budget and cycle that is agreed at the time.
SchoolsCompared.com: Can you break down what you mean when you say Taaleem is 56% is owned by the government?
Alan Williamson: Our shareholding has 56% government entities. For example, Knowledge Bank is a government entity. Islamic Bank is a government entity, National Bonds is a government entity. So all of these organisations, who own shares, are government entities. But Taaleem itself is not a government entity.
SchoolsCompared.com: Why have you decided to buy the land and buildings?
Sam Truman: We don’t have a fixed model when it comes to the land ownership, but we are buying the land and the buildings for JAS. It is our preferred position.
Alan Williamson: The reason is this: By choosing to buy the land and buildings we can set own terms of when the school becomes profitable. We can set the number of years it will take…
Background on this story
Read the full news story here.
Read about why Dubai College, a leading not-for-profit, has increased its fees by 5% whilst for-profit schools keep fees static.
Read Dubai’s ‘not-for-profit’ schools mystery debunked – as not-for-profit schools raise their fees, UAE parents feel the pinch of rising tuition fees and inflation.
Read our sister site, WhichSchoolAdvisor, on the not-for-profit versus for-profit choice facing parents here. Which offers better value?
Read our review of Jebel Ali School here.
Do you have a view? Contact SchoolsCompared at [email protected]. All comments and opinions can be shared in confidence by request.
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