Reconsidering private education/labour gov

[Bluevelvetcake2]

As it looks increasingly likely that we will have a Labour government at some point, I’m wondering if anyone who was considering private education for their children is now re-considering it? We have put down a deposit for a prep school we really like which we could comfortably afford at the moment but not with significant fee increases. Just wondering if anyone else has concerns along the same lines and if so what are you thinking…

What damage? Money needs to be found and I'd sooner a few middle class people have to use public school (gasp) than the poor continue to starve (conservatives plan)

That is a valid point. Means tested perhaps?

Is there any sector which isn't improved by having competition with different ideas, standards and outcomes?

I don't think fees would increase that much anyway. I still think it is immoral to tax education.

One quite realistic outcome, however, depending on the positioning of the chosen school in the independent sector market, might be the entire school being absorbed lockstock into the state sector as an academy. There is precedent for this.

Academic selection would need to end up there are other selection mechanisms apart from ‘academic’ already in use in the state sector.

Absorption of mid-range independents into the state sector is much more likely than closure of the schools, placing pressure on the existing state system.

It’s quite a ‘win win’ for current parents when this does happen as their fees disappear. However the school has usually already been in distress for quite a while before being taken forward.

anyway I expect this will be another aspect of the March of academisation.

It won't mean a significant increase in fees.

The value of charitable status is about £200 per pupil per term (source: The Guardian). That's less than the variation between fees between schools and of course wouldn't apply to those schools that are businesses.

I have never seen a full proposal for removing charitable status. At present, charities have to be wound up in accordance with the law, which means that all assets must be sold at proper market venue, and the proceeds donated to another similarly-aimed charity. That's going to mean closures, and I really wouldn't want to have a child in either sector as state schools have to accommodate those left with no school as a result of closure. Because they're not awash with money to create new places.

If Labour really is looking at this, I hope they publish an exact proposal soon, as this is very much a devil-in-the-detail issue and the consequences of getting it wrong will affect all school age DC.

Imposing a form of tax on school fees is a totally different question, unrelated to charitable status (currently exempt as still the same as the EU regulation which is no taxation on nursery, school or university fees - same one covers all those). Post-Brexit it is however something that can be done.

I really hope it would be done as part of a proper review of successor VAT, not piecemeal (unintended consequences also possible, and I don't trust any party to be competent). But I think this tax change is far more achievable, and likely to raise considerably more tax revenue

Removing charitable status is legally extremely difficult. In part because it’s not the case that the state can just sweep in and take assets that have been left to charity. It would be a complete and utter mess.

However, Adding VAT of 20% to school fees is a very quick and easy job to do and I would expect them to do it pretty much immediately on getting in while they’ve got a massive majority. If you’re only going to scrape by for private school fees, I wouldn’t sign up for it right now.

Anyone who thinks they will do this and then use the money to improve the state sector is living in cloud cuckoo land. It will be done as a way of 'proving' that Labour want to 'level up' and it will appeal to the left.

If they do it many private schools will close and there won't be enough secondary places. It will create chaos.

In the long term those who would have chosen private but can't afford it will push into areas and 'create' outstanding schools. Like the one near me that pushes any disruptive children into another school that is part of that academy and all the children and parents in that town just have to our up with it.

Plus the state sector won't improve as they won't use the money in education they will waste it.

@Scaevola Thanks for that clear explanation. I think (not sure though) Labour have just spoken about removal of charity status and not vat on fees right? But it seems like a number of people think the latter is likely as well

Yes, loads. Transport for one. Health for another. Certainly education for most people.

My eldest is going to secondary and it was a factor in us staying in the day sector, rather than going towards the more expensive day/boarding schools. I am working on the basis 20% could go on the fees in say 18 months and I need to pay for this.

Labour were talking about entirely abolishing the private education sector decades ago.

Didn't happen. Charitable status (and not all independent schools have it) wouldn't, as some have indicated, make a massive difference to fees even if labour got around to doing it.

Labour piss me off for different reasons but the way that the Tories are intent on making everyone pay a lot more for most things ought to offset your fears about Labour possibly shoving a couple of hundred on your school fees at some point in the future.

I've lived out of the country for many years, and only been back for a couple, but (and this is a genuine question, not a goady one), what improvements did Labour make to education last time they were in power?

I think they would be fools to attempt to tackle charitable status, because it's a policy that's going to cost the state more in the longer run.

But VAT on fees is simpler and would raise more

Labour pledged it in 2017 (Corbyn, not sure if it's been reaffirmed by Starmer)

Gove is on the record of being in favour too.

So I think it'll come, it's just a case of when and at what rate.

(And I do think people often don't realise there are two separate issues here; and that if schools could legally relinquish charitable status without having to sell up in line with current law on winding up a charity, they would probably leap at it. But allowing charitable assets to become privately owned could be highly unfortunate. That's why I'd want to see the exact proposal - lots of people have banged on about it being desirable, but no-one has actually shown a good way in which it could actually be done)

I suspect posts like these being Tory HQ as its one of their last ditch defences: don't vote Labour they will abolish private education, and put up tax.

It is not going to be a priority for a labour government.

Indie sector here and we've recently been sent a survey asking specifically if we could afford the fees if they went up by 20% overnight. The survey was from an independent schools group so obviously they are contemplating it, even if it doesn't happen. Interestingly a lot of parents replied that such a rise would mean they'd have to withdraw their DC and go to the state schools (which are hugely oversubscribed here).

The quicker it happens the better.

Is the fear re charitable status and adding VAT?

I have no idea how long it would take. I would hope it’s gradual so children already started don’t face issues with living to oversubscribed state sector

Ok it’s useful to know my fears aren’t completely unfounded. Will have to discuss with DH. We had already taken into account yearly rises but not adding on an extra 20%. DH is optimistic about career progression and salary increases, I’m always a bit more circumspect.

Oh wow… and to think that I initially read this as you were potentially going to consider state schooling because state schools would actually be properly funded under a labour government!

Honestly, I’d be more concerned about general rises in inflation and cost of living increases.

Labour have talked about doing this sort of thing before, but we’ve had Labour governments before and nothing’s changed about private school’s tax statuses.
A new Labour government coming in might make this a higher priority than previous Labour governments have, but I can’t see it coming top of their to do list. I wouldn’t imagine it coming soon.

However, private schools in general have a track record of regularly increasing fees above inflation, not to mention all the hidden costs beyond the termly fees figure.

So you can reliably count on annual above inflation fee rises, plus jumps in fees at certain points as your DC age through the school, as well as all the current uncertainties around increases in the cost of living. Something to bear in mind when thinking about how the finances might work.

@Bluevelvetcake2 it’s certainly on peoples minds. I was discussing this yesterday with a school mum at my DCs school and she is considering sending them to a state secondary school.

There is a far wider impact following any significant increase in independent school fees. The popular schools will become even more over-subscribed and guess what? The houses surrounding them will become more in demand, therefore more expensive. Soon the top state schools will mirror independent schools anyway because only the wealthiest can afford to live anywhere near them. These parents who can afford the nicer areas (and ergo, the nicer schools) can also afford to donate money to theIr children’s schools, because they’ll be saving so much cash from not having to pay fees … thus becoming a semi-privately funded school regardless.

@autienotnaughty they could go out and get more hours etc (currently doing a 52hour week at work whilst managing our side line) instead of targeting the middle yet again. My next day off is likely to be bonfire night realistically and that's if DH doesn't buy the house he's interested in at auction!!

OP if they remove charitable status and out law private schools it is likely many will convert to academies with significant "voluntary" contributions for extracurricular activities. I'm banking on the fact most MP won't want their kids in the state system so although they won't say who or how they voted it's likely they will vote against it or the policy won't get through the House of Lords.

Do you have any good state school near you? One near us is comparable with the local boarding school, it selects based on postcode/house price. We've debated moving closer to it vs private as eventually we could sell the house, DS would get the same education and likely a similar group of friends.

I agree that independents converting to academy status is what we are most likely to see in the low-middle price range of the sector.

Really Transport? Health? Education? You don't like choice? Perhaps it's nice for someone to pick what's best for you? I like free will.