Whitehall “braced for private schools collapse”

[ICouldBeVioletSky]

Whitehall ‘braced for private schools collapse’ due to fee rises

Worth reading the whole article, it’s not quite as alarmist as the headline suggests. But as you’d expect, gov sources are talking it all down while the ISC is ringing the alarm bell.

https://www.thetimes.com/article/e6465c9e-d462-48cb-a73e-74480059a1f3?shareToken=05bf599cd4a2376fe3ce83cdce607100

I’d be quite surprised if some of the schools near us don't fold tbh. There will definitely be a contraction in the sector, I just hope those that hold on can remain a viable concern.

Not much to add here, other than I'm another one staggered that there are people on this thread actually thinking about moving to Abu Dhabi rather than paying tax in the UK! There is literally no amount of money that would induce me to move there.

And it's not even just because of the human rights/dictatorship stuff, but also because it always looks like such a deeply depressing place to live (alongside all the dead-behind-the-eyes influencers)

I did not say you behaved socially unacceptable :) However, lots of comments on this and other similar threads express hatred towards children, victim blaming, SEND shaming and other ugliness yet you claimed there was no hatred. Therefore, I concluded that you found those comments socially acceptable. I happen to disagree, that's all :)

I find it particularly worrying that some people hating SEND claim to be working in admissions meaning a position of power. No wonder disabled children and their parents have to go through years and years of bureaucratic torture, denial of basic provision and what not. It's horrendous yet you find those comments OK.

I hope I made my reasoning clear enough :)

A risk register is normally updated each year for accounting/audit. The auditors assess it. It isn’t constantly updated.

What sort of risk register is only updated once a year?!

@Ubertomusic So you are blaming me for other peoples comments? Maybe take it up with those people.
I do not work in admissions.

An organisation that only sees a risk register as a tick box exercise for auditors, rather than a tool to assist future planning and sustainability.

When I was a state school governor, our risk register was reviewed at every meeting of the Finance and Premises committee (so once a term). Sometimes it was a quick update and other times it was a much more involved conversation. For something like VAT and the seriousness of the impact on school finances and viability, I would expect it to have been on the agenda in its own right, and I would have expected the board to have been informed on possible impacts at the very least from when Trussonomics kicked in and it was clear that a Labour govt was going to be a shoo in.

They tend to give a terms notice, or to end of school year.

Not every organisation which fails is a result of poor planning. There’s only so much planning a business can do. There comes a tipping point.

Yes there does but the schools that have closed ‘due to VAT’ per the Telegraph etc have usually been failing for years before they closed. Some schools will close but it was ever thus.

Nothing would induce me personally to live there; but don’t you understand that if you impose counterproductive policies that are poorly thought out and don’t do what they claim, then people will try to get away from them?

It’s a Labour equivalent of the Tory bedroom tax and the child benefit cap, which was also stupid and counterproductive for all the same reasons - it targeted children for their parents’ income level, it went against fundamental postwar social norms (a welfare entitlement should be based on an individual’s situation and not their parents’; education should not be taxed), and it was counterproductive, poorly implemented for show and ideological spite, and promoted with misinformation. The bedroom tax/benefit cap, similarly, apart from causing people who couldn’t absorb the cost to suffer and some to game the system, also raised almost no money in the end. It was just a piece of spite theatre to throw to the worst instincts of the voters.

This VAT policy is the same. I’d expected better of a Labour government, and I’m disappointed not just with them, but also with the nasty instincts of voters who are so keen for other people’s children to have a bad time that they ignore the fact that it can’t do what it claims anyway.

I’m afraid you’re the one talking nonsense. A risk register isn’t only a financial document used for audit. It should cover every aspect of an organisation and all the key risks that it faces internal and external. It should be reviewed by the board regularly and feed into budgeting and strategy planning not dusted off once a year. That’s a very old fashioned approach to risk management that leads to poor decision making.

Just pay your fucking VAT for Christ's sake. I can't believe how whiney you private school parents are. Jeez.

It's not just the parents that are affected..people working at the schools that will close due to these changes will lose their jobs and their homes.

And not all parents can afford the rise and now have to send their SEND child to a mainstream school knowing full well they can't meet their needs.

The people who you are angry with (i.e the incredibly rich people) , will just pay the fees, and not even notice the increase, they'll avoid their taxes in other ways. They'll remain in the independent sector, or leave the UK independent sector. Either way the "£1bn raised" from this VAT will be firstly effectively reduced by capital expenditure and VAT refund etc, it will increase the annual education budget by less than 1%, ,so big whoop de do for your kids, hooray... but don't forget, the government will have to fund more places, with just less than 1% of increased budget...

Get angry at the right people.

You’re applying a model from a very different sector. In the financial services sector risk registers are updated all the time. That’s part of the regularity framework. Not in education or the small charity sector, where actually running the school/charity is the priority, there are not teams of admin, financial or policy staff on hand, and trustees are mainly local volunteers. The regulatory environment in schools is focused mainly on safeguarding and health and safety, eg updates to KCSIE, etc; but the financial regulatory environment does not normally change rapidly, so risk registers are not focused on political policy. They are more so in other sectors. In schools, the key issues for updating are the Single Central Register, not the risk register for audit purposes. And whilst it might go past the financial committee regularly, it isn’t going to be constantly updated. How many accounting and governance staff do you think small charities or educational trusts have? Do you think they spend their time thinking “oh Liz Truss is a bit of a disaster, I’d better put in a few weeks researching the half-formed education policies of all the opposition parties just in case they happen to come to power in a few years’ time?” Absolute nonsense! (And I’ve worked in public policy as well, for Labour actually, and most party policies themselves are not even properly discussed and costed until they go in an election manifesto six weeks before an election — so the idea that a school finance office of a bursar and a couple of accounts staff should be researching them years in advance is absolutely stupid and you’re really scraping the barrel here to be honest.)

There are WASPI women claiming that 25 years notice wasn’t enough notice of a financial change, but you think schools should plan for a major tax change in 3-6 months?

Nothing would induce me personally to live there; but don’t you understand that if you impose counterproductive policies that are poorly thought out and don’t do what they claim, then people will try to get away from them?

@Juliagreeneyes I understand what you're saying, but I still can't see how even any number of the sort of counterproductive and/or poorly thought out policies that we're ever likely to be subject to in the UK would be worse than living and working in Abu Dhabi.

Please remind me where those human rights were when children were locked down with no education while the toffs were partying after lining their pockets with taxpayers' money? I guess it's fine if some children suffer horribly with incurable damage to their mental health and social functioning...

As above - this is the small charity/educational trusts sector, not a commercial business, and charity/schools governance is not the same as being a board running a company. Budgeting is generally done yearly, precisely because it follows the academic year - and pupil numbers and staff salaries / income and costs are all calculated across a whole year in advance. You don’t quite understand how school or educational trust budgets work if you think schools are constantly redoing major budgets and updating strategy planning throughout the year!

The waspi women did not go to court after the initial changes. It was the later changes that were carried out with very little notice.

I am Treasurer for a local charity. We do a proper risk register that is regularly updated and we have far less finances than any private school.

Actually, our school could not get any details from the gov up until December, despite constantly asking for more info. I know the gov has been in a shambles for years, but I couldn't imagine it was that bad 🙈 They did in fact introduce the policy without any planning! I dread to think what is going to happen with much more serious things like defence...

The actual details weren’t clear until October, to be implemented in January. I have a child with send in private provision - labour promised send would not be affected, but the way the law has been written means we still have to pay vat. Details of how laws are written matter - it is all a guessing game until the details are announced.

for any other similar tax change there would be years between the passing of the law and its implementation to allow consumers and businesses to adapt. Less than 3 months is a cruel joke - it is certainly outside of any sort of normal academic planning window or most school notice periods, and seems designed to catch people out.

I assume you are quoting me. Define a charity how you like. Doesn't match the dictionary definition or how the term is typically interpreted (I totally accept many of these schools were genuinely charitable when set up, i just dispute their current charitable intent)

dictionary.cambridge.org/dictionary/english/charity dictionary.cambridge.org/dictionary/english/charity]]

My post was in response to this

As to risk planning, many schools have adapted quite admirably to individual risks, but there have been a series of pressures over the pat 5 years that have put even the best run schools under strain : covid, inflation / cost of living (affecting their cost base as well as customer affordability), tps costs. Now labour have added vat and increased labour costs (via nmw and ni increases), which just ends up being too much all at once. I know a number of schools and business owners who had mostly figured out how to deal with vat, and then the additional tax rises wrecked it all. In a different time the implementation of vat might not have been as big of a deal, but in the context of other economic factors and labour policy decisions it will push many schools and families over the edge.

I don’t define a charity how I like; you can look at the actual legal definitions here:

https://www.gov.uk/government/publications/what-makes-a-charity-cc4

the vernacular definition of charity isn’t really relevant. You might want to read up on the legal definition of charity, which to my reading quite explicitly includes education.

www.gov.uk/government/publications/what-makes-a-charity-cc4/what-makes-a-charity-cc4

The 13 descriptions of purposes
The 13 descriptions of purposes listed in the Charities Act are:

• (a) the prevention or relief of poverty
• (b)the advancement of education
• (c) the advancement of religion
• (d) the advancement of health or the saving of lives
• (e) the advancement of citizenship or community development
• (f) the advancement of the arts, culture, heritage or science
• (g) the advancement of amateur sport
• (h) the advancement of human rights, conflict resolution or reconciliation or the promotion of religious or racial harmony or equality and diversity
• (i) the advancement of environmental protection or improvement
• (j) the relief of those in need, by reason of youth, age, ill-health, disability, financial hardship or other disadvantage
• (k) the advancement of animal welfare
• (l) the promotion of the efficiency of the armed forces of the Crown, or of the efficiency of the police, fire and rescue services or ambulance services
• (m) any other purposes currently recognised as charitable or which can be recognised as charitable by analogy to, or within the spirit of, purposes falling within (a) to (l) or any other purpose recognised as charitable under the law of England and Wales