Government takeover

Last week, I did say that I would consider presenting a summarised version of a particular section of my book, Let the Aisles Proclaim, that dealt with the Government takeover of Penang Free School. That section alone occupied 10 pages of the book, but I have managed to cut the story down to a more palatable version here, shorn of many details. Here it is:

In 1919, the Penang Free School found itself in a financial bind that could no longer be ignored. The warning signs had been there for years. As early as 1916, during the School’s Centenary celebrations, Headmaster Ralph Pinhorn had already sounded the alarm. Unless the School’s income was substantially increased, he wrote, it would not be able to “keep up to its old level and advance with the times.”

His fears soon proved justified. When the School Committee met in April 1919, Pinhorn reported that the annual deficit was expected to reach $6,800 that year. Left unchecked, the shortfall would swell to $55,400 by 1932, with expenditure projected to rise from $74,800 to nearly $120,000 over that period, while income would remain stagnant at about $64,000. The School, once a proud symbol of Penang’s educational leadership, was staring at insolvency.

The Committee’s sub-committee, tasked with studying the problem, came to a grim conclusion. Raising school fees would be unrealistic since 80 percent of the parents earned less than $200 a month. Public donations were equally unlikely. The days when annual subscriptions brought in a few thousand dollars had long passed. There were only two practical options left: to seek a higher Special Grant from the Government or to ask the Government to take over the School entirely.

The latter suggestion was sensitive. For a century, the Penang Free School had been supported by local philanthropy, by merchants and community leaders, especially from the Chinese community, who saw it as a civic duty to sustain the School. To surrender control to the colonial Government could be seen as abandoning that legacy. Yet, as the sub-committee noted, Government management could bring advantages: better salaries, opportunities for teachers to be promoted to headmasterships or inspectorships, and access to higher professional standards.

Before any decision was made, the matter was referred to the Chinese Town Hall, the symbolic heart of the local community. On 11 April 1919, the Town Hall representatives met and, after due consideration, gave their assent. They raised no objection to a Government takeover.

A month later, Pinhorn, as Honorary Secretary to the Committee of Management, wrote formally to the Colonial Government. His letter was long, detailed and respectful. It was an appeal for survival. The School, he said, required an additional $50,000 a year to maintain its position in the educational life of the Colony, and another $150,000 for new buildings and equipment. He set out two options: either the Government should increase its annual grant, or it should assume full responsibility for the School’s management.

If the latter course was chosen, Pinhorn asked that all funds belonging to the School be placed in the hands of trustees. These funds, he emphasised, were gifts from the people of Penang and should remain dedicated to the School’s improvement, not absorbed into the Colony’s general revenue. He also proposed that the Government delegate day-to-day management to a local Board of Governors. This would, he argued, preserve the School’s individuality and flexibility, preventing the “dead level of uniformity” that came from excessive central control.

Months passed before the Government replied. Then, in early September, a letter arrived from the Acting Colonial Secretary, H Marriott. The tone was cautious but positive: the Government was prepared to take over the School “on terms to be arranged between the Director of Education and the Trustees.”

Negotiations began. The School Committee drafted a list of conditions. All land and buildings would be handed over, since they had been acquired with both public and Government support. The existing funds, however, were to be placed under trustees, the proposed Board of Governors, who would administer them for scholarships and other educational purposes. The School’s masters were to become Government servants, enjoying equivalent pay and privileges, with two-thirds of their previous service recognised for pension purposes.

News of the impending takeover leaked to the press. The Pinang Gazette reported that the Government’s decision “will meet with general approval,” noting that financial pressures had compelled the move but predicting that the Free School’s traditions would be preserved, if not strengthened, under official management.

In the subsequent discussions, not every proposal from the Committee was accepted. The Government objected to the idea of a locally empowered Board of Governors but agreed to the establishment of a Board of Trustees to oversee the School’s endowments. The Committee stood firm that the Endowment Fund must not be absorbed into the Colony’s general coffers. To do so, they argued, would “check future generosity” from Penang’s donors. Eventually, the Government conceded that the Fund would remain a Trust, its income to be used for scholarships and educational improvement.

On another front, there was disagreement over the appointment of headmasters. The Committee wanted the Government to reject seniority as the sole basis for promotion, arguing that merit and energy were far more valuable. “To be over forty,” they wrote pointedly, “is generally regarded as a positive disqualification.” However, the Director of Education, HW Firmstone, was unmoved. While assuring that merit would be considered, he made it clear that the Government alone would decide such appointments.

By December 1919, after much correspondence and negotiation, the Government’s final decision arrived. The Penang Free School would officially become a Government institution on 01 January 1920. The School’s funds were to be divided. Trust monies to be administered by a Board of Trustees, and all other assets transferred to the Crown. The Trustees, consisting of the Director of Education, the Resident Councillor, the Assistant Treasurer and several local representatives, were formally appointed by the Governor on 09 September 1921.

The following year, the Trustees awarded the first of their scholarships, among them the Hutchings Scholarship, in memory of the School’s founder.

Yet, even as these administrative changes unfolded, Pinhorn was looking ahead. The School was overcrowded, he warned at Speech Day that same year, and the facilities inadequate for a modern education. The playing field at the Renong Grounds was too small, and there was always the risk of losing access to it. One solution, he suggested, was to move the senior boys to new buildings outside the congested town.

That idea gained momentum almost immediately. In May 1920, the Legislative Council approved $147,561.45 to acquire land for the expansion of Penang Free School. It was an enormous sum in those days. By February 1921, the Penang Free School (Acquisition) Bill was tabled in the Council to formalise the transfer of the School’s property to the Crown and to establish the statutory Board of Trustees.

The Bill passed on 09 September 1921 and became the Penang Free School Ordinance No. 19 of 1921, deemed effective from the first day of the previous year. Thus, the Penang Free School entered a new era: now a Government school, yet still governed in part by its own endowments, traditions and sense of identity.

In the end, the takeover was both a rescue and a renewal. It ensured the School’s survival at a time of financial strain, while preserving its local spirit through the Trustees. It also paved the way for a new beginning—one that would see the School move to its new home in Green Lane.