Will VAT on private school fees lead to a partial collapse of the sector?

[mids2019]

Will VAT on school fees coupled with cost of living drive a lot of parents from the private sector or will the majority absorb the cost? Are the numbers that potentially end up in the public sector going to offset any gains to the treasury through VAT?

Labour are working at about 4-5% transfer rate to the public sector but is this an underestimate?

Because higher mortgage rates aren't a new thing and that would have impacted in previous years

I see, you mean people with deeper pockets who can afford the exorbitant house prices in catchment? Not here to argue btw, just feel fed up with governments that peddle their own agendas and call it “for the greater good”. This VAT policy will achieve precisely nothing, when there are so many other issues in Ed or else they should focus on.

No but it is a significant % ie around 20-25%. Therefore it follows that 20-25% of parents aren't easily affording the fees without VAT.

Are 20-25% parents getting 100% bursaries? You can get bursaries with incomes over 6 figures.

What’s up with this anyway

VAT will decrease private

Yeh we want it anyway state is falling

Private enrolments go down as VAT comes in, and it’s all it wasn’t us

At least own up to the hit. It’s only just started

Yes, that is around the figure I would imagine and I agree, they are quite out of touch with the very middle road private sector (presumably because their kids go to the London grammars) and the choices parents in rural areas especially have to make. I think a lot of people who were relying on boarding to keep jobs with travel in particular will struggle, so there will be a knock on there also, mostly hitting women as per usual as they will be expected to drop lesser paid jobs to do childcare and not be out late for work.

@Slav80 its not my opinion it’s a thing. It’s one reason why immigrant dc perform so well.

There is no way of knowing on a national scale but I know our school offers multiple 100% per year and then the rest are tapered down.

someone claiming to be a teacher and completely refusing to acknowledge the likely difficulties that moving schools will cause for kids with SN absolutely does need to do better. The ignorance, the refusal to engage with the issues being pointed out to you, the total lack of concern - I’m really quite shocked. The teachers I have met, whatever their politics, are knowledgeable about the difficulties our children suffer and show compassion. I’m sorry you can’t.

Because higher mortgage rates aren't a new thing and that would have impacted in previous years

What? They haven’t even been at 5% for a yr & plenty of people haven’t even come off their fixes yet. 😆

So why has there been 2 years of reporting on Radio 4 about mortgage rises plus 100s threads on MN about how people can't afford the mortgage rises?

You'd be surprised. Trying to get people involved in campaigning on this is bizarrely difficult.

By the sounds of it there will be loads of ex private school families up for campaigning so maybe things will change?

Isn't that all fee-reductions, not just means-tested bursaries?

I saw a figure of 7% for means-tested bursaries but it wasn't an unbiased source. The academic research I've seen suggested that only 3% of families got bursaries that covered 75%+ of fees, and only 44% of fee reductions overall went to means-tested support. I'm still trying to ferret out a reliable source for the overall % for means tested support.

Surely moving more students from private to state is what you want?

What did you think would happen?

I didn’t disagree, I just asked if you meant people with deeper pockets have more parental involvement, as you have to have deep pockets to live next to the good schools in the UK.
We are immigrants too, not a chance to pay this sort of prices for a house, the school in our current catchment is in special measures with Safeguarding being a key concern. Hence the rant against the catchments system and the whole VAT on fees crap, neither helps the average Joe.

Yep I agree that VAT will make this worse

If wishing made it so! But often those with deeper pockets have an interest in maintaining the status quo - or once they're through the system they're not motivated to drive change. And the current government's position has been a total wet blanket or trying to get any kind of positive change. Fingers crossed people will get fresh energy and motivation if there is the potential for change under Labour.

So why has there been 2 years of reporting on Radio 4 about mortgage rises plus 100s threads on MN about how people can't afford the mortgage rises?

I fixed my mortgage less than 2 yrs ago for 2.6%. Yes it’s was an increase but nothing like recent rates. 2 yrs ago people were not predicting interest rates to be so high. So you are arguing that the whole cost of living thing will have no impact on private school admission figures because any impact will have been felt years ago. Ok….

I think that many people substantially underestimate the number of people (including dual income couples) on very high salaries in London and the London commuter belt, not to mention the inherited assets cushioning the lifestyle. The area is teeming with parents who are privately educating two, three or even four children.

This policy is unlikely to deter parents whose children are already in secondary education. Parents whose children are in primary education will make a strategic house move for secondary. The true impact won’t be felt for years and the only likely winners are the parents of overseas pupils who will find it even easier to get a place at an English public school (not sure how this rule would play out in the devolved administrations as education is a devolved power).

Not saying this is right or wrong, just my prediction.

Surely moving more students from private to state is what you want?

@EasternStandard what? Why would I want that?

Where will they go then?

Because you’re pro a policy that will do that

How can you not have thought it through?

One of the main bits of the reporting has focused on the slow burn of the issue as people come off low interest rates and onto worse deals. 24/25 is the second academic year since that slow burn started.

But there is also a cumulative factor isn't there? Similar to what people say about VAT - people are less likely to remove their children mid-phase, they will wait for a natural break or not apply in the first place.

The reporting on the decrease also seems to assume that the school age population decline will only affect the state sector, which is an interesting assumption. I wonder if there are any studies and reports on how the private sector is planning for significant decline in the overall applicant base?

Yes, London is a complete financial bubble. It is the rural private schools, not the elite ones which will be closing down.

@Slav80 its more the other way around. Families move into up & coming areas & the schools improve, house prices go up, richer people move in & the cycle continues. I’m a Londoner & lots of London schools were not great when I was a dc but equally lots of area back then were nothing like how they are today.

I work in an independent school and we feel that we are in a stronger position than most but we are still expecting to lose a reasonable proportion. Very sad.