Vat Question????????

[Anoth]

Can I ask a silly question??
We have been given our school fees for 24/25 academic year now for the school my daughter attends.
My question is if labours policy comes in half way through an academic year will the schools be allowed to put the fees up for the remainder of that academic year? Eg if we start paying X amount on September and then labour get in and introduce the added vat in October. Will the fees go up in Jan of that academic year? Normally fees remain un changed for the whole of the academic year once fees have been published but I understand this is a strange situation!
Just wanted to know if I need to prepare to save more for 24/25 fees just in case or will these that are now published still remain until the end of July 25??.
Thanks!

With VAT, I'll be handing the government an extra £3.5k of course. Pretty crazy that I will actually have to pay the government £16.5k for the 'privilege' of saving them another £7k. (In addition to directly paying the school myself)

The Adam Smith report goes into the various costs to the economy https://www.adamsmith.org/research/short-term-thinking-analysing-the-effect-of-applying-vat-to-school-fees

It does also address the fairness aspect. But mainly the fact that it's a completely stupid tax from a financial perspective.

Oh, and the point of me saying that I currently pay the government £13k for the 'privilege' of saving them another £7k. (In addition to directly paying the school myself) is to explain one of the reasons why this tax will cost the country more than it takes.

Because some people will choose to stop doing it. Each kid staying in the private system makes the government £3.5k richer with this vat change. But each person who moves their kid to state and reduces their hours makes the country £20k poorer. It's not a great balance!

Combine it with all the other costs in that report, and the cost of implementing the change, and overall the vat change is likely to make the country poorer not richer.

It’s not up to 90% odd of the population to support your privilege

There is no logic to this argument.

Family 1. Sends children to private school at a cost to them of £20k per year, thus saving the taxpayer £8k per year by not using the state system.

Family 2. Saves £20k a year and spends it on a luxury holiday abroad which the UK government gets no VAT from. They send their children to state school, costing the taxpayer £8k a year.

Which family is receiving most support from the taxpayer?

Also out of your £17k fees about £8k comes back to the government in tax according to the Adam Smith Institute using Oxford Economics data. That's staff payroll taxes, VAT on purchases, suppliers' tax contributions (payroll, corporation tax, business rates, dividends), and the further downstream impact of all that economic activity that supports more taxable businesses and jobs.

That's about double what the state school sector returns in taxes. Actually, the Adam Smith Institute makes a mistake because they left out the VAT reclaim that I only recently learned state schools can get but independent schools can't. So it's even more favourable, another £0.5k each by my fag-packet

So it's not your £20k, it's closer to £25k.

The economics of this really are awful and advocates are failing to think this through.

Practically speaking they'd have to time it such that parents could swap their kids into state at a sensible point ie start of the academic year.
There would be no advantage and only disadvantage to state schools having to accept a bunch of kids mid academic year so I can't see them doing that.

The more of your comments I read the more I’m convinced you’re a stooge funded by the private school sector to show how poor attitudes in state school education can be and to encourage people to use PS to avoid such bigotry.

If so I can assure you that you are doing a fine job.

Funnily enough I have a friend whose boy left there due to bullying. His GCSEs were not great and hes a bright boy but was not well supported. They paid for tutors to remediate in some subjects.
They have gang concerns and all the normal stuff that happens In any London school.
Just before we get all misty eyed over any one school.
All schools can be good or bad for pupils. Even the best schools, state or private, can let pupils down. We all agree that schools need to improve. The question is how best to fund that. Not sure this policy will be the magic money tree they hope but we will see. But I hope they meet the funding promise even if everyone can send their kids to state schools?

sent you pm

Labour probably won't time it, they've said that they'll do it ASAP.

But not many parents will pull kids out mid-year. Most will either just choose not to start private, delay starting (YR->Y3 or Y3->Y7), or pull kids out at a sensible time for them to get into a good state school (starting Y7 or Y12).

So the actual impact of the vat change will only become clear in 5-10 years time, when the changes in parent's choices have worked themselves through.

A new tax is obviously meant to be a long-term thing, and you can only really judge it when any resulting behaviour changes have settled down. Any initial windfall Labour get by mugging parents who can't quickly change their choices is as unethical as a retrospective tax. But they'll only have trapped parents for a few years. For a tax to be considered successful, it needs to work sustainably over the medium-long term without damaging the economy.

Actually, the impact will start being felt straight away - eg on another thread, someone noted that the entrance grade to get into their grammar school was higher than usual this year. Presumably more competition as some parents decided not to start private in Y7, in anticipation of the vat change.

But it will build up year by year, as each Y7 and each Y12 intake has the new numbers, but the kids who would have gone private in previous years remain in state, so it trickles up the school. It will take 14 years to fully stabilise, but I think it will mainly be through after 7 years. It's expensive to start in YR and I think those who are borderline on choosing whether to go private or not probably wouldn't have started so early.

At our prep it used to be that about half the class went to grammar, and the other half private. Last year it was 80% grammar, and I’m sure it’ll continue to be the trend. I prefer to continue in private but not enough to justify £33k++ per child (fee already at £28k). I also can’t accept paying another £5k per child in VAT after all the income taxes we already pay. Grammar it is.

state schools don’t have to accept a bunch of kids whether it’s mid year or not, only if they have places and if they have places then they will prob be glad of the extra funding wherever it is. If it’s a non transition year anyone moving to state school the la is only obliged to allocate them a school it doesn’t have to be the school of choice, don’t could be a miles away failing school thst still has places, if a parent turns this down the la have fulfilled their duty and aren’t obliged to find another school. Transition year would be subject to same criteria as everyone else

I think the main mistake the Labour Party are making is that they have underestimated private school parents as a group. Most will be relatively financially savvy and many will think f…it, have paid enough tax, not doing this. So it won’t just be those who cannot afford it anymore - that assumption is wrong.
As others have highlighted it changes the whole question of whether or not to do private school in the first place if the Government is going to deliberately disincentivise so much. It no longer becomes worth it especially in this day an age with such easy access to online tutoring. The Tories have already taxed this lot too much, so I do not think they are going to behave as the short form IFS report suggested. Therefore, I feel very sorry for the teachers (& other staff) and I wonder whether private schools are planning for mass redundancies and have budgeted for redundancy pay. This is not something they and their governing boards are familiar with.

“state schools don’t have to accept a bunch of kids whether it’s mid year or not, only if they have places and if they have places then they will prob be glad of the extra funding wherever it is. “

Where I live there has been an increase in exclusions of children from more disadvantaged backgrounds in secondary schools. Who is going to guarantee that Academies won’t do more of that and welcome private school kids in? They have to follow the law, of course, but many are already excluding poorer children and not just at transition points.

If a family apply for a state school place, and all the nearby schools are full, then the LA will use the Fair Access Protocol to force whichever school they think would incur least detriment to go over numbers. A place has to be found/created within a reasonable journey of home (didn't the rule of thumb use to be 45 mins? And of course the council would have to provide transport if it was over miles)

So yes it's possible that schools will have to accept additional pupil/s.

That's a non-obvious risk. The number in private education is not spread evenly round the country. If a school goes bust, or there just happens to be a slightly larger exodus than Labour predicts, it's far from certain this will happen in places where there is an existing excess of secondary school places.

So over the whole country, it adds up. Locally, there might be real problems

.

There is quite a large school (I think originally 900 pupils) that went bust in Croydon quite recently. It is called Old Palace and was part of the Whitgift Foundation which is very well known.
It will be difficult for Council’s to plan ahead. Private schools that look like they are in trouble due to the policy should be in direct communication with Councils so they can plan ahead somehow.
Old Palace did not shut immediately, it carried on for exam years I think. So there has to be a protocol in place for most private schools to follow and the DFE should be working on this with the private sector as it is completely reasonably foreseeable that this WILL happen.

It's not quite closed. It's winding down, and will close after the end of the summer term in 2025.

They gave 2 years notice of the closure and stopped accepting applications then. It's a real bugger for parents whose DC were then below year 10, but the 2 year lead time meant that at least those about to start GCSE or A level courses could see them through.

Prep closing this summer.

@AnotherNewt - thanks for the clarification. I think it is a shame that Trinity School could not have gone co-ed to take the girls in Years 7, 8 and 9. Would have made sense if they are part of the same Foundation. I hope all the girls will find places, such a tricky age and school places for these year groups are still very hard to come by due to the high birth rates.
It is this kind of wind down I hope the sector will exercise and also work together to find children school places locally (state or private) if many schools go bust. I cannot see how they won’t given COL and VAt. Let’s hope I am being too negative.

Well, yes, except existing Trinity parents might not have been happy with the idea of it going coed!! Plus I'm not sure where they were supposed to magic the space for hundred of girls from Old Palace...

There is a history of all girls' schools closing in the Croydon area, unfortunately. The big mistake was when Croham Hurst closed, the Whitgift Foundation bought the site and absorbed the pupils, who just weren't at the same academic standard as OP girls. Previously, OP had had excellent academics, but then their results really suffered, and the school never recovered its academic reputation.

They have gang concerns and all the normal stuff that happens In any London school.

Skinners isn't in London - it's in Tunbridge Wells.

https://www.skinnersacademiestrust.org.uk/601/our-schools-1

Skinners grammar part of the successful group. Tonbridge School - well known public school also in the group. And a prep school in Sevenoaks as well as a state primary.

“Our family of schools The Skinners' Company has been involved in education since the Middle Ages and we now have around 7,500 pupils under our care today. We are proud to support an extremely diverse family of schools which encompasses primary and secondary, all ability and selective, state funded and independent, urban and rural. The eight schools in the family are in west Kent, on the Kent coast and in North London.
We have a strong belief in the power of education to promote social mobility and address disadvantage. We put students at the centre of all that we do and have a commitment to obtaining the best outcomes possible for each student in our eight schools.
The aim of our schools is to provide all our young people with the opportunity to make the most of their talents and fulfil their potential. To do that we ensure that our schools have first-class teaching, management and leadership, support each other through collaboration and sharing of expertise and good practice, and are supported and held to account by high-quality governing bodies.”

Schools are MUCH BETTER off in this kind of set off away from too much ideology and Government of the day control.

That was meant to say “set up” - to me it makes far more sense to partner successful independent schools with state schools in that sort of format than impose VAT that will KILL a lot of smaller private schools.

‘Practically speaking they'd have to time it such that parents could swap their kids into state at a sensible point ie start of the academic year.
There would be no advantage and only disadvantage to state schools having to accept a bunch of kids mid academic year so I can't see them doing that.’

they’ll only be ‘swapped’ in if spaces become available. The 4 ‘good’ state secondaries are full in our city, but there’s room in the 3 that aren’t as popular. Lots of room. And being a city none of them are too far for the kids to walk/bus - so that’s good.
Not that it would matter to private kids who are used to travelling miles and miles at the moment to their schools.