When Sir Peter Lampl was invited back to his old Oxford college for lunch with its president in the 1990s, three decades after he had left the UK to pursue an international business career, he was shocked at how things had changed.

There were few of the bright pupils from working class families with whom he had studied during his degree — the kind of student who had benefited from free grammar schools as a route to top universities and increased social mobility. The intake from state-funded schools, which teach 93 per cent of British students, had declined from around two-thirds to less than half.

His concern is still greater today, at a time when coronavirus has forced widespread school closures, highlighted deep inequalities and made it harder still for those from poorer backgrounds to improve their lifetime prospects and earnings.

“We need to raise our game,” he says in an interview in which he outlines strong views on contemporary British and US society, business and the need to overhaul charitable giving. “The UK and the US are at the bottom end of educational achievement around the world. We’ve got more to do than we ever had. But it’s like pushing water uphill — and it’s a bigger hill now.”

The initial reaction he had from Oxford admissions staff after his revelatory lunch was dismissive: “It’s not really our problem. If they don’t apply, we can’t admit them.” They only became interested when he proposed to pay for a summer school for students from these schools, so they could familiarise themselves with the university and aspire to study there.

Of the 64 attendees on his first programme in 1997, most applied to Oxford and 16 won places, vindicating his idea. It also inspired him to abandon his successful career in finance and move into philanthropy full-time, through the Sutton Trust charity that he founded.

Some 20,000 UK students have since attended the summer schools, with 62 per cent going on to a Russell Group university. Others join programmes and gain free places at prestigious US universities. The trust also campaigns for broader school reform and co-founded the Education Endowment Foundation, which studies and identifies the best evidence-backed education policies.

Lampl, 74, the son of Viennese immigrants who built a new life from scratch in postwar Britain, went from a Yorkshire council estate to become a pioneer of leveraged buyouts in the US and Germany. Since then he has channelled much of his fortune into the Sutton Trust to support the cause of social mobility.

“It’s exciting to make a lot when you don’t have any money,” he says. “I gave 23 years of my life to generate what would be worth £230m today, so the opportunity cost of my time is rather a lot.” He only regrets that he did not remain in a business a little longer. “I wish I’d made more so I could have given away more.”

He had a happy upbringing with his family in the Britain of the 1950s and 1960s, with no experience of prejudice as the child of foreign parents, although he quickly dropped his Yorkshire accent to blend in once he moved with his family to secondary schools in the south of England.

The story of his subsequent commercial success is told in Ticket to Ride, his autobiography published this month. Lampl inhabited the swaggering New York of the 1980s, adopting the fancy stationery, limousines and prestige office addresses to impress commercial partners in a world in which “appearances mattered”.

He describes the high-rolling lifestyle that his fortune funded, with multiple homes, cars and private jets. But by the mid-1990s, he was becoming bored with making money or spending it on himself, and made a first significant charitable contribution to support gun control after the Dunblane school massacre in Scotland in 1996.

Lampl soon decided that giving away money without lending his time or expertise to support the underlying causes was inadequate. He shifted to a more strategic form of hands-on, engaged philanthropy focused on offering the best educational opportunities to students with talent, regardless of their economic and social backgrounds.

“Education is the building block of everything,” he says, pointing to its pivotal role in his own professional life. After school, he took a chemistry degree at Oxford (paid for and topped up with a maintenance grant for living costs) and an MBA (also when there were no tuition fees for students) at London Business School.

Despite his enthusiasm for many aspects of the US, he is deeply critical of the funding of its school system, paid for by property taxes. As a result, low-income neighbourhoods in the Bronx in New York have far fewer resources to finance education than nearby affluent ones like Scarsdale, where higher property prices also mean moving to access better schooling is impossible for most.

In UK education, Lampl sees raising the quality of teaching as pivotal and is dismissive of government policies including the creation of corporate-backed academy school chains. “It’s disgraceful having business people running 30-40 schools who are not terribly competent,” he says. “Kids only get one choice of school in their lives.”

His biggest frustration, despite small pilots and advocacy with a succession of education ministers, is failure to win political support for a “needs blind” open access programme at top private schools. All of their places would be opened up to competition between pupils, regardless of their means to pay, with fees for those on lower incomes funded by government.

Critics say the approach risks a return to the stigma of selection at grammar schools and distracts from the structural need to improve state schools. In their view, social mobility requires wider improved opportunities for students with all levels of talent and ability.

“You can walk and chew gum at the same time,” retorts Lampl, arguing that partial progress is better than none. “Changing the system is quite hard so let’s get [bright students] in the system.” He points to the contribution of his own programmes, which he estimates have generated a more than fivefold “return on investment”, as measured by students entering university compared with the costs of funding the scheme.

Beyond his particular social priorities, he is critical of many practices in philanthropy including lavish fundraising dinners, which he says often generate modest contributions once expenses are deducted. Instead he prefers an approach that seeks to resolve important issues by applying business principles, including measurement and accountability.

He argues that the US is “streets ahead” in philanthropy, with a celebratory “culture of asking” he would like to see emulated in the UK. The UK’s Gift Aid system, which provides tax relief for charitable donations, should be overhauled, he says, switching from the current complex reporting system that splits relief between donor and recipient to the US approach of a simple deduction from income.

He also endorses the introduction of an equivalent of the US requirement for charities and foundations to disburse a share of their endowment each year rather than to sit on unspent assets. This share might vary over time, but with current investment returns, he suggests 4 per cent would be fair.

Today, Lampl is thinking increasingly about the long-term future of the Sutton Trust. He has mobilised 110 donors who fund its work year-by-year alongside his own contributions, generating considerable activity and attention for its modest annual budget of £5m-£6m. But he is keen to expand its scale by building a £1bn endowment.

That could be through a merger with an existing foundation, the creation of a new entity with a carve-out of some of the existing endowment of another organisation, or support from wealthy donors including private equity and hedge fund backers. He may no longer be directly in business, but in even in philanthropy, he remains a dealmaker at heart.