In the most detailed external appraisal of the British Council since the 1970s, the Foreign & Commonwealth Office (FCO) has published a Triennial Review report on the British Council calling for more transparency, accountability and clarity of purpose.
The review found damaging perceptions among stakeholders that the organisation is primarily motivated by income generation and conflicts of interest among its activities aimed at supporting UK providers while still being commercially sustainable.
The FCO has called for greater separation between income generating activities and public services
The FCO looked into claims that the British Council could and should do more to help UK providers in foreign markets specifically in ELT and exam delivery.
“We found no evidence of any deliberate policy or centrally approved practice of stifling competition or competing unfairly against other UK providers,” it states. However, the FCO has called for greater separation between income generating activities and public services.
The British Council’s current operation model shows nearly 80% of income is generated through English teaching and other educational activities with remaining funding coming in the form of tax-funded grants from the FCO.
The level of grant funding has fluctuated in recent years due to efforts to cut the UK budget deficit. Last year the British Council received £172 million in government aid on par with 1998-1999 levels.
Self-generated income from mostly ELT and exam operations has risen by over £100 million since 2010 and is predicted to increase by a further £100 million by 2015– “well beyond levels needed” to compensate funding cuts the report said.
The Review offered three potential pathways to achieve greater separation and transparency: internal administrative separation, including financial reporting, establishment of a government-owned company (GovCo) for income generating activity (reporting to the FCO), or establishment of a suitable commercial, legal entity for income generating activity.
A cross-Government Steering Group will start work this month to assess options and make recommendations to ministers about a future operating model.
The report also recommended transferring responsibilities of providing business development support and opportunities to UKTI while the British Council maintains an advisory role.
Chair of the British Council, Sir Vernon Ellis commented: “While we welcome the review’s conclusions about the contribution the British Council makes to the UK, we agree that our significant growth and the increased importance and complexity of our relations with government and other stakeholders has given rise to a number of important issues that need to be addressed.
“We recognise the concerns which have been raised and have already started to take action on several of its main themes.”
“We recognise the concerns which have been raised and have already started to take action on several of its main themes”
The review took into account views from around 1,200 individuals and organisations including government ministers, British Council trustees, staff and advisors, head of UK diplocmatic missions and other interested parties in the UK and overseas.
Further findings lauded the British Council’s role in promoting the UK abroad saying it is a “valuable national asset and should be maintained as main official UK body for cultural diplomacy”.
It concluded that art, education and English should continue to be the main areas of business for organisation with science and technology given higher priority than they currently have.
Established in 1934 to promote understanding of the UK across the world, the British Council has had a Royal Charter since 1940 and became a registered charity in 1962.
