I am sorry to report that Kezia Dugdale, the hot favourite to replace the rather decent and capable Jim Murphy as leader of the Scottish Labour Party, appears to be just what a Scotland does not need - a believer in yesterday's failed dogma to solve the problems we face today.

 

Ms Dugdale has indulged herself in one of the unthinking left's favourite sports - toff bashing. I live in hope that it is only to curry favour with her vanishingly small electorate but the evidence is unhelpful, her throwback to proper socialism moment comes on a subject she should know a little about, education.

The policy in question is her declared desire to end the charitable status enjoyed by Scotland's private schools.

Ms Dugdale declares that we must "think outside the box" (I didn't know people actually used such a hackneyed phrase) and that there are "No sacred cows in Scottish state education" before going on to declare that she believes in taxing the rich "a bit more" to enable "targeted" spending on education. "I think this is a fundamental question of fairness" she says - but does not blame any parent for choosing to send their children to private school - of course not, these people might vote.

The reason why parents do like private schools and socialist politicians don't is because they tend to confer an advantage on a child.

This isn't because private schools are wonderful and state ones terrible - in fact many of the latter are staffed by caring, capable and dedicated people who do a great job.

The issue is money, if you spend £18,000 on a product (Fettes School Senior day fees) it tends to be better than one you spend, say, £9,000 on.

The problem is that, having grasped the issue, Kezia stumbles off in the wrong direction identifying the outrage of reduced rates and wishing to strip the schools of charitable status to address that.

Let's stick with Fettes again, which appears to obtain a reduction as a charity on its rates bill of approximately £167,000. According to the SCIS website, Fettes has a pupil role of 763 so the amount per child is a little over £200.

Undeniably real money but entirely dwarfed by the subsidy parents of private school children give to the taxpayer.

Parents struggle to meet the annual cost of £18,000 for private education from their after-tax income and forgo the state education for which they have already paid with their taxes and which the state does not have to provide.

My rough calculation is that the benefit per child to the taxpayer is perhaps 40 times the benefit of the rates reduction - and this is before taking account of the positive benefits to our economy of boarding school children who come from abroad - who enrich both our national coffers and our culture.

If Ms Dugdale really wants to help state school children the answer is not to drag the private system down but the state system up. How to do that? Simple, make school fees tax deductible at the basic rate.

The result? - an explosion in demand for places at private schools by parents who can now afford it and a further reduction in the amount the state has to spend on educating a lower number of pupils. I say "has to spend" because of course the key is not to cut the amount the state actually spends in proportion to the reduced numbers so that, per pupil, the spending by the state rises.

Better outcomes for state sector pupils would follow.

Go on Kezia, think outside the box.

Our new columnist Pinstripe is a senior member of Scotland's financial services community.