If you have kids in private education, what is your school planning to do re VAT?

[Ladychaise]

I have two kids at a London independent school and currently just about scrape the cost of fees. Labour’s intention to add 20percent on the fees would make it impossible to keep them there, if all that cost goes to us - it is a worrying time.

The school’s bursar is being lovely but it’s very much a ‘let’s cross that bridge when we come to it’ take on it! I get that we don’t know for certain if Labour will get in or how fast they will implement this - but surely schools should be planning for this and working out how much of the VAT, if any, will be ‘covered’ by the school?

Aware there is a lot of uncertainty but does anyone else’s school have a plan in place? Thanks so much

The private school I work at have been putting together a plan for some months now. They will concentrate on more lettings, and “creative accounting” that was the words of the burser! They won’t have to pay VAT on boarders.

The private school ds is at (a much smaller day school) hasn’t even mentioned it 🙄

Someone else will take their jobs, and replace the tax revenue.

He’s attacking something which he personally benefited from, so it is relevant. Not everyone at private school grows up in a “privileged” household. There are lots on means tested bursaries. Some schools have already said they’ll cut back on those. It’s the least privileged ones at private school who will suffer. The wealthiest won’t. Private school will become even more elite.

There have been lots of previous threads on here where people have said they will give up work or reduce their hours. A few of these have been GPs. It’s not a profession which has people queuing up to fill the vacancies at the moment…….

@MidnightOnceMore

@MidnightOnceMore

And there are lots of people unemployed just waiting for that vacancy 🙄

My sister is a geriatric doctor and she and her husband are considering private school for their daughter as it’s right by the hospital and has good flexible wraparound to enable her to keep working full time. She has said if this comes in the local state primary doesn’t offer cover for the hours she needs and so she will probably go down to 50% or move away from practicing medicine.

So the company you work for would replace a senior 40-50-something with someone on equivalent salary?
mine sure as hell wouldn’t, certainly not in these economic times. They’d be recruiting someone 10-15 years younger and cheaper, if not ‘absorbing’ the role into other people’s workloads.
but good to know not all industries are as hideous!

@Glitterbaby17 thats exactly teh type of scenario I can see repeating in lots of sectors

That’s exactly the type of unintended consequence which will happen. It’s such a short sighted policy.

Perhaps those parents who can ‘just’ afford private school will have to send their kids to shock horror state schools instead. If everyone devoted the time and money to state schools instead they would all be functioning much much better. We live in a mixed area- some affluent parts but also lots of deprivation and most kids go to the local state school despite a fair amount of parents arguably able to scrape through private. As such the PTA is very active and we raise huge amounts of money to support the school this way.

“If everyone devoted the time and money to state schools instead they would all be functioning much much better.”

Well the Labour Party should really get some proper data first to work out if the parents using private schools really are all working 100% and paying 40/45% tax rather than 1 rich banker plus SAHM type scenario. If it is the former, on balance, they should not implement the policy. Because “devoting time” to state schools appears to be exactly what the former do not have. It is more efficient for those persons to use private school and pay tax.

If everyone devoted the time and money to state schools instead they would all be functioning much much better

Why aren’t the 93% of state school parents doing this already? What difference are private school parents going to make? State schools are not functioning poorly just because 7% of parents use the private system.

State schools as a whole are not functioning poorly at all! Some do incredibly well and much better than many private schools.

@Another76543 because a significant amount of them could never afford to.
Private school is a massive luxury (special schools and SEN aside) and for those parents who could never in a million years afford it it’s hard to sympathise with people who can’t afford the increase in fees.
If we had no private schools and all parents had skin in the game of state schools there would be more money and investment in them. As it is those who can afford to go to private schools, those in power sent kids to private schools and state schools are left to rot.

Lots of state schools do well. Too many do poorly though. I think most politicians agree that the state sector has room for improvement. You only have to read the threads on here from teachers talking about behaviour problems etc.

A significant number of parents can afford to though. Not all of the 93% of state school parents can’t afford time or money - plenty can.

As it is those who can afford to go to private schools, those in power sent kids to private schools and state schools are left to rot.

Plenty of politicians already use the state system. The difference is that they choose schools in affluent areas, and schools which are selective. It’s precisely the same type of school which private school parents will be looking at.

“those in power sent kids to private schools and state schools are left to rot.”

Those in power send their children to top performing state schools. And the Labour Party is not proposing to up funding per pupil to address the significant underfunding in real terms in the last 15 years. The top performing state schools tend to be socially segregated with influential parents, just like private schools. Segregation by ability or rich catchment or religion. It does not mean that there are zero poorer children in such state schools, just that a school can cope much better when it only has a significant minority of poorer children or children of lower ability, or children who have not met national KS2 targets.

Pretty much every single state school top politicians have sent their DC too has low FSM and high attainment on entry. It need not be grammar - if you live somewhere like Cambridge or Winchester too, the intake is generally richer and more educated on entry. Because parents support reading at home - that being the biggest determinator of academic success plus the level of education of the mother.

I have a relative working at a private school. The school has already cut every possible excess cost, teachers are being forced into loads of extra (quite random) responsibilities due to not wanting to pay dedicated staff for some essential duties. The school will simply close if a VAT rise forces out even 5% of the children. It will probably cause quite a shit storm if they just stick VAT on fees quickly. Schools can make plans, sure, but if they have no money, then there's no money!

I still can’t see how the VAT proposal is going to help the state sector. Private school parents will look at state schools already performing well. It won’t help the state sector as a whole.

If Labour win then register for a place at your local school and simultaneously apply for a bursary at your current school. You need to cover all bases to make sure your children are not left in the gap in between. In the interim you should contact your MP / prospective MP and make your position clear.

I work in a small undersubscribed prep. Someone asked earlier why schools are already putting fees up ~10% this year - it’s absolutely unrelated to the potential VAT payment coming in, our costs have gone though the roof just like everyone else’s. Heating, electricity, stationery, all costing more. Staff were given a below inflation, lower than state schools got pay rise, which had to be funded from somewhere. Assuming the cost of living crisis continues, these rises will have to continue year on year, as well as the 20% VAT increase.

as above, the vast majority of spending goes on salary and pensions, there’s no VAT to be reclaimed on that so no saving there.

we are already nowhere near full. 20% increase on fees will be catastrophic for numbers. I suspect our school will close and families will go to the good state schools locally instead. Our parents are not the mega rich - yes they are richer than most and I’m not pretending otherwise, but generally just 2 professional parents. Fees aren’t any more than full time nursery, so people who managed to pay over £1k per month for that can also afford our fees. But another 20% on top may be too much for some.

In Kent, they aren't opening special schools instead independent schools take children and young with specific needs e.g autism, SEMH etc, these schools only take county council funded places, locally the cost of these places 37k - 58k per child per year, with VAT added, I wonder if this has been factored in as there will be a cost on the public purse.

This sounds like pretty poor intel. Retrospective taxes are usually contrary to the law and successfully challenged through the courts.

My daughter's private school has been looking into this closely (as, no doubt, have most of them). In the parent cohort there are at least three senior tax lawyers that I know of who all have a vested interest in helping the school mitigate the pain for parents if this does come to pass.

He's not attacking it. He's changing the tax arrangements.

George Osborne benefited from child benefit. He changed it. Cameron's parents benefited from pensions at 65/60. He changed it.

Politicians make policies. The public vote on them. Polling suggests the public support this policy.