How's the Private School VAT increase impacting you?

[mumsthewordi]

To private fee paying ...are kids/s still in private ? Are you comfortably still able to afford and happy paying it ?

To state, how do you feel? Have you been impacted by more kids in class or would you expect that to play out this year? Or perhaps you weren't supportive ?
Do you think state schools will improve ?

Full disclosure
A struggling fee paying parent of one kid only other is at state and my oh is an amazing secondary school teacher - we are a divided household indeed at time, but we've made choices best for us.

Tax specialists now believe that Further education colleges may also be caught in the widening of the VAT net. HMRC responses often lacked clarity + sometimes contradicted earlier advice.
We already know some Yr 1 uni students could also be caught up due to the age range being set at 5-19 yrs old.

We already know some Yr 1 uni students could also be caught up due to the age range being set at 5-19 yrs old.

How do you come to that conclusion? Universities are already defined as separate to schools.

It's completely made up bollocks. Clause 48 of the Finance Bill specifically excludes higher (i.e. university) education, along with nursery, vocational, and TEFL courses.

That’s what I thought, thanks for clarifying (although I think it’s Clause 47 that states the exceptions?).

Apologies I stand corrected and have edited. I had not checked Clause 47

I have said that I stand corrected

My child's small private school announced on Monday that it will close for good at the end of the summer term, it was non selective and there were many children with SEN, some already failed by the state system. All the wonderful teaching staff and ancillary staff will be made redundant. It has broken our hearts. How can this possibly help anyone?

I'm so sorry to hear that

The staff will find jobs in more financially viable fee paying schools or teach/work in state schools. The students similarly will find new settings. It will be an upheaval but may be very positive for many. It doesn’t have to be a disaster at all.

My two are at prep school and the fees have gone up 17.5%. The main worry was the school closing as a result of the policies, but it is now merging with a larger PS school to survive so we’re incredibly relieved. I had saved up a bit of a war chest in anticipation of a labour Government so we’ll be able to cover the fees, we’d struggle if it was a secondary school.
Mine don’t start secondary until after 2029 (after general election), so we count ourselves very lucky that they’ll escape relatively unharmed from this Government. My heart goes out to parents who are having to move their children.

So sorry to hear this.

It's really sad tbh. My BIL is a teacher. He worked in the state system before moving to private, as did most of his colleagues. Although his school is financially stable, he said it's pretty clear from discussions with colleagues that if the school were to close none of the teachers would move to the state system again. Lots of teachers who refuse to teach in the state system - in BIL case for very valid reasons - will just find work elsewhere (civil service, for example) so it's not the end of the world for them.

The ones who will really suffer are the children who won't flourish - for whatever reason - in a state environment (my DN certainly wouldn't) and whose parents cannot afford the place them elsewhere because of the VAT increase.

But you're right. It does't help anyone. It's about narrowing the playing field so people cannot 'buy' (as some call it) opportunities for their children. Which is fine in theory...but only if you scrap private schools altogether rather than make them even more elitist. All this will do is widen the gap between those that can afford it and those that can't.

Its a policy based on spite, nobody genuinely thinks anything positive will come out of it.

I predict some parents who support this policy might have buyers remorse when Phillipson introduces her ‘education decolonisation’ program and they realise they’ve completely priced themselves out of alternative options.

“Do you really believe that you just have to pass a medical degree and then it's all about getting on with the patients!!! Many medics are studying for years beyond this stage. I can't wait to share this with my neurosurgeon sister. She finds her patients are just a little bit more focussed on her excellent clinical skills than her banter.”

@Kittiwakeup - why do you not stick to the topic and ask her how many of her colleagues are foreign born with ties elsewhere and how many are or are not impacted by VAT on school fees. You know, sticking on subject et al.
My family in medicine report that for London the percentage of foreign born doctors is much higher than the ONS average, for example. India, in particular, is now doing well - people do not leave just because the VAT on school fees, but the combo of a mismanaged country, taking the brunt on the NHS during Covid, the belief that the future of their children may actually be better back in India now etc etc - all these factors combine into a larger picture. And others on here keep going on about the Middle East not being attractive or Singapore etc - well it may be very attractive for many of our Indian doctors. Anyone cared to think about that?

Quite. The policy will raise zero money. May even cost tax payers money in the end (state places to be paid which weren’t before, support for SEN children which was paid for by their parents before, now the state etc etc etc, refund to schools for work completed where VAT was paid etc).

But we will never see an analysis to prove that. Much like we’ve never seen a cost / benefit analysis of the policy before it was proposed / introduced.

Shocking but these Labour Party incompetents can get away with it. Much like they’re getting away with freezing some old people in their own homes.

Meanwhile Labour will spending tax payers money on pointlessly changing the curriculum (just concentrate on maths English and sport if needs must), and spending tax payers money on giving breakfast to millions of children who don’t need it. They’re making schools organise breakfast for every single pupil. What sort of chaos is that? Imagining the logistics each ‘morning’ in big schools, is enough to understand they’ve messed up.

A cynical person might wonder if there’s a link between these dumbing down policies and lowering the voting age to 16. Not me though.

I think there's certainly a link between proposals to reduce the voting age and political parties which rely on voters' emotional reactions rather than on voters understanding how economics works and the complexities and interconnectedness of government policies.

To suggest that dumbing down the curriculum is a deliberate attempt to reduce voters' lifelong understanding for the same reason is very cynical indeed.

Surely this is a situation where we should not assuming malice where incompetence would explain it. Despite everything, I remain a pragmatic optimist.

I don't have kids of school age. I have never been to private school. I think it was unfair to bring in the VAT so quickly and in January (should have been next September).
Let's face it those sending their children to private are saving the public sector £8k per year per child and getting hammered for doing so.

Exactly. A business that wasn’t financial viable has gone out of business. Thats the way it goes, they clearly weren’t able to maintain student numbers. As for teaching posts - there are many, many option for teachers, in using tutoring- teaching is one of those professions where staff are always in demand, luckily.

@derogations It's not really a social rallying call. You misunderstand.

It's pointing out the very predictable negative consequences for many people, and the lack of any positives to anyone. Both earlier when the damage could be averted, and now to ensure that Labour are held to account.

If that was the way tax actually worked… my childless family members and friends are ‘saving’ the state loads of money by not having children who use up health and education resources. Should we applaud them??? How about all the people who have never needed benefits? Who are healthy? Who don’t use public transport services? Who don’t go to free public museums? Do they get a refund or tax break if some kind??

Don't accept this
You can't have it both way: that simultaneously schools are rich enough to absorb the VAT yet at the same time have been mismanaged financially so that they can't cope with the triple shock of falling numbers due to VAT + increased NI + increased business rates.

So which one is it?

It’s made up bollocks from private parents who have realised that most people don’t care what fees private parents pay for schooling. So they’re trying to make it sound as if we’ll all suffer, we’re all in this together type rhetoric.
Except we aren’t all in it together. That’s why they’ve opted OUT of state schooling.
We’re all fine thanks.

Obvious SOME business are fine and SOME are not. It’s not that hard to fathom.
Read the announcements the schools are releasing - by their own admission they have been in financial TROUBLE for years.
Years. Falling boarder numbers. Falling pupil numbers. That’s the issue.
i said it before - any school that was fine and VAT is the only thing making them close was NOT managed properly.

Why would a child's education and healthcare be counted to the parents?!? It's a benefit to the child.

Each childless person benefitted from their own education, benefits from their own health care, and pays one person's taxes. You need to think about it over a lifetime. It's similar to pensions. The state manages these flows of payment and benefit over each person's lifetime.

NHS healthcare works fairly well being state-run to remove financial incentives. But financially, you should consider it a form of insurance. Like house insurance, you pay a small amount regardless if whether you need it. Then if you do need it, you get much more out than you paid in.

Education doesn't work that way. It's a fixed amount which the government pays early in a citizen's life - when the citizen doesn't yet have earning potential - in order for them to become productive adults. That person then pays tax during their working life.

None of us have ever actually suggested that we not pay the part of income tax which covers education. What we've pointed out is that when we're paying for our childs' education ourselves instead of the government paying, it's fucking obtuse to then additionally tax us on the money we're subbing the government.

Benefits - I agree that we should move to a European/Nordic contribution based model.

The reality is that the strength of school finances lies on a spectrum just as the wealth of families lies on a spectrum. Unfortunately, Labour only see the world in monochrome: rich/poor, privileged/under privileged .
BP categorically said that indy schools would be able to absorb the cost of VAT. We argued that many couldn't due to that financial spectrum and were told we were lying.
The 8 announced closures so far are the beginning and exceed the normal average of 1.6 closures per week as standard in Indy sector. The biggest impact will be seen from Sept 25 onwards as parents will most likely see out the end of this academic year if at all possible.