School dilemma - is the 20% increase going to happen?

[FredandAmy]

We have one Y7 DC at private school and a younger DC due to start school later this year. Both DC are dyslexic (youngest not yet officially diagnosed but obvious to me and nursery staff have raised it) and the private school has excellent learning support. It has been amazing for DC1.

Planned to send both private but now worried about the potential huge rise in fees when Labour wins the election next year. We can currently afford fees for both by making sacrifices but if two sets immediately rise by 20+% it would mean one would have to leave.

We have a good state school close by, and hopefully she’ll get a place there but I’m worried that the DC will resent not being treated equally. Also worried that DC will not receive the support they need.

Am I worrying unnecessarily? I don’t want to start her at the private school and have to pull her out when she’s settled, and then find the state school doesn’t have any places. Not sure what to do for the best.

'School dilemma - is the 20% increase going to happen?'

Well, the unfair tax break is going to go. Depends on your school though, doesn't it? They don't have to pass the costs on to parents.

1. Labour may not get in. Vote Conservative and encourage others to do so.
2. It may not be 20% because the way the new tax may have to work as they do not want to impose 20% on university fees, clubs, religious after school clubs and all the rest is that they may have to impose a tax like a windfall tax on energy companies which will only apply to a particular kind of private school and probably just on the tution not boarding school/food element of it. Hopefully Labour will be sued into the ground over how they end up doing it. Also schools can turf out anyone who does not pay full fees and refuse to allow outsiders into the grounds as may be no longer any need to play by those rules that force that on them so they may be able to swallow some of the cost. If they do have to charge 20% VAT then they can claim back VAT they spend so although the cost won't be neutral it may be less than 20%,.

If there's one thing I've learned from reading this thread, it's that I'm going to vote Labour.

The vat revenue does not make sense, I would be surprised if vat actually happens. This linkedin post us useful:

https://www.linkedin.com/search/results/content/?keywords=labour%2020%25%20school%20vat&sid=HsG&update=urn%3Ali%3Afs_updateV2%3A(urn%3Ali%3Aactivity%3A7084899276098527233%2CBLENDED_SEARCH_FEED%2CEMPTY%2CDEFAULT%2Cfalse)

some assumptions, based on 25% reduction in pupils, the table on page 10 of the report shows revised savings:

• Total remaining pupils = 394,340
• Estimated VAT receipts (based on 15% net VAT rate) = £926 million
• Additional spending on state schools = £907 million
• Total amount raised = £19 million

It has reminded me why I'm not.

The only “charitable” events our local private schools hold are basically marketing events to drum up more clients.

The Charity Commission's guidance on the new public benefit test says it depends on the school - if it is rich as kings and owns half of London then lots of substantially free places need to be made available; if teh school has no savings and can hardly manage to pay teachers' salaries then public benefit could be allowing local people to use the pool

Yes I'd do this route. I presume your Y7 is already in private? If no the y9 is also a route into private.

What about private schools which aren’t charities? There are quite a few. Will they be suddenly charged more tax?

I realise I sound a bit dim here but just curious.

70% are charities. I don't know the details of Labour's plan. if it is 20% VAT on all education including university fees, tutoring, after school clubs, Saturday religious school fees then it would also apply to those which make profits. If it is a new percentage tax which is not VAT and is only on particular kinds of private schools then it may be different. Labour is going to find it quite hard to bring this in as it is not simple to pick out one kind of teaching and say that has this new tax on it.

Yeah it is. It’s all private schools that have full time students under and up to the age of 18. For the purpose of academic study leading to GCSE/Alevels/Bacc etc

I’m not sure even the Labour Party know the answer to this! They keep saying about “removing charitable status” and I’m not convinced they realise that a lot of private schools aren’t charities.

It was only 4 years ago that the Labour Party voted to abolish private schools altogether and integrate them into the state sector. They seem to have backtracked on that now.

Basically, they’ll say whatever they think will win them the most votes, regardless of whether it’s workable in practice.

This is quite a good consideration of some of the options by a law firm https://www.withersworldwide.com/en-gb/insight/read/labour-party-policy-and-independent-schools

‘The vat revenue does not make sense,’

taking away unfair charity status from some of the wealthiest businesses does make sense.

besides, schools don’t have to pass costs on to parents.

@Poopoolittlekitten do you know anything about the finances of most private schools? This debate is totally pointless if people are operating on the assumption that all of them are like Eton etc with vast reserves and land to draw on. Most do not and operate on extremely tight margins with zero "profit". If my school had to pay VAT they would not be able to avoid passing it on to our parents, most of whom absolutely would struggle to meet the increase. If enough of them can't and leave, school closes and 600 kids need accommodating in the already full state schools,some of which have already failed the kids which is why they are with us in the first place.

Unfortunately, a lot of opponents of private schools think that all schools are all sitting on millions of pounds they don’t know what to do with. If VAT is introduced, schools will either have to cut costs dramatically (fairly difficult) or pass that cost on to parents.

Many opponents don’t even know why they want private schools taxed anyway. Their arguments are non sensical. On one hand, they say it’s not fair that some children get an unfair advantage and, on the other hand, say that private schools are a waste of money and are no better than the state system. Angela Rayner’s comments last week are a prime example. If the private schools are a waste of money and no better, how are those children getting any advantage over state educated children?

We might know more on 23 July 2023 - ie very soon, as according to this that is when Labour produces its first report on the issue https://labourlist.org/2023/01/labour-motion-on-ending-tax-breaks-for-private-schools-rejected-by-mps/

'@Poopoolittlekittendo you know anything about the finances of most private schools?'

Yes, as it happens.

But that's irrelevant because I don't actually care. And any BUSINESS that charges the wealthiest for services should not have charitable status.

If labour gets in. And if they do I'd be pretty shocked if this was their number one priority, there's far bigger problems facing the country than private schools.
I currently have a DC in Year 10 at a private school, if fees increase by 20% they will be going to state and the money I'll be saving will go towards tutoring. State schools will suffer due to stretched resources and the privileged children will still be privileged.

Me too! Some of the comments on here are incredible. Such entitlement

Ending private school tax breaks would raise £1.5bn for state sector, thinktank says | Private schools | The Guardian

‘If there's one thing I've learned from reading this thread, it's that I'm going to vote Labour.’

same. Quite frankly I wouldn’t care if taking away the charity status didn’t raise a single penny- it still needs to go.
Of course - schools could ACTUALLY offer fully funded places to any WC kid locally and fill the schools with bright, talented kids from all walks of life. And keep charity status bu actually becoming charities.

‘State schools will suffer due to stretched resources and the privileged children will still be privileged.’

we’ll cope. I love the way fee paying private school parents think their offspring are going to waltz into state schools overnight half way through their high school years…

That's not what was said.

LAs will be obliged to find state school places for private school leavers that want them. It's not a case of waltzing into. In practice, given the PP's child was in year 10, they will probably switch school for 6th form as the policy will not be implemented day 1 of the Labour government.

And parents with enough to not quite afford private school any more can pay for tutors etc that still give privilege, as the PP said.

@Poopoolittlekitten the fact that you think all private schools could offer fully funded places to many children and still offer the advantages of private, namely small classes, specialist subject experts, lots of sport shows that you have no idea about their finances. As has been said many many times, a large number of children attending private are not the "offspring" of hugely wealthy parents. Outside the SE it's possible for middle income households to afford 1 or 2 places on two professional salaries with careful budgeting and judicious choice of housing etc. Not easy, but worth it if, like many, your child is not being catered for in the state sector.
There is such a nasty undercurrent on threads like this directed at the children .. frequently derided as posh thickos at best or hothoused "little darlings" or snobs, or privileged, sheltered, blinkered, etc. They are just kids ...mostly very nice, polite, motivated enthusiastic kids, though often, certainly at my school with some additional needs not met in a 1000+ comprehensive school. They don't deserve the almost gleeful vitriol at the idea that they might be uprooted and disrupted at a crucial time in their lives and neither do the parents who are, in many cases making significant, restrictive choices to be able to do their best for their child. I would never say that parents who don't do this don't care. They may be lucky enough not to need it..their kids may be one of those who does great in state, or they may not be but it is genuinely beyond the financial scope to go private and get what they need and THAT is the issue that Labour should be addressing. ..why is the state failing those students? Best way to attack private schools, of you really want to, is make state so good they are not needed. I'd vote for a party that offered up a plan to do that.