Another private school in Suffolk announced closure by the end of the summer term

[twinsyang]

Not only students have to find another school, but also teachers, employees. Eg cook, gardeners, support staff all have to look for jobs. :p
i feel sorry for the families affected.

It’s not good for those involved but we’ve always had schools closing. We’ve seen the rate increase a bit caused by a mix of demographic changes and the VAT but those same demographic changes mean that the pupils can hopefully be accommodated in other local schools.

Asked Gemini again: The government’s current fiscal projections for the private school VAT policy are fundamentally flawed because they misunderstand the cumulative math of student attrition.
If the cumulative drop rate (the total percentage of students leaving private schools for the state sector) reaches 10% over a few years—rather than a massive 10% drop per single year—the government will still fail to break even. This shortfall becomes glaringly obvious when looking at the immediate data and overlooked secondary costs:
The Current Reality: This year alone, we are already seeing a 3% drop rate. If this current trend maintains itself, the cumulative drop will hit 9% to 10% in just three years' time, cross the tipping point, and wipe out any projected financial gains.
The Funding Burden: Every student switching from a private school to a state school requires immediate, full state funding. This rapidly drains the very tax revenue the VAT policy is meant to generate.
The Secondary Economic Impact: The government’s break-even analysis completely ignores the broader economic fallout, including:
Reduced tax revenue from private school teachers and administrative staff who lose their jobs as schools downsize or close.
Lost VAT revenue on goods and services those schools would have otherwise purchased.
Increased strain and resource dilution across an already stretched state school infrastructure.
Conclusion: The claim that this policy is a net positive for public finances is unsustainable. A steady 3% annual migration will quietly push the government past the break-even point in under three years, leaving the state sector with more students, fewer resources, and a net financial deficit.

The "Phantom VAT" Fallacy (Savings vs. Spending): The government assumes that parents who move their children to state schools will suddenly redirect their massive tuition budgets into high-VAT goods and services. In reality, these families are reacting to financial pressure. Instead of spending, their natural behavioral response is to save the money, pay down debt, or invest it to secure their financial position. Because savings and investments do not generate VAT, this projected tax revenue simply disappears.

@twinsyang If you ask Gemini (or any other LLM), the answers that you receive are likely to be biased towards the answers you think you should receive. Because that's how the models work.

That's a general comment, not specific to this issue.

It's a school that had a hundred pupils. No secondary school in the state sector could make the numbers work with that few pupils either. Obviously it is jolly difficult for the kids that are there, but I can't see how a school that small could be sustainable in the long term. There's another local private school that has agreed a streamlined admission process for its pupils, though obviously I recognise that's still a total pain compared to staying at the school we were already in.

But they don't have to be qualified to work in academies either (and most are. In both).

Fucking hell.

And yet we are literally seeing this play out aren’t we. I wish RR would run her policies through Gemini before she actioned them .

Birth rate falling.

State and private schools closing.

Warnings in LA’s regarding their strategic school place planning (statutory role) due to less school places required.

Nothing to do with Labour.

ETA my local LA has closed 16 schools since 2018 Conservative government and council). Falling roles and per pupil funding makes schools financially unviable. In the state system it is illegal for a Governing Board to run an unlicensed deficit budget and LA’s will withdraw that license. Hence closure

Exeter Cathedral School in Devon announced closing it's prep school resently. I noticed as we lived 15 years in Exeter left a few years ago.
The school has struggled with low student numbers left with 176 pupils despite having a total capacity for 300.
But it isn't new.
They have struggled with financial pressure for a decade and lost a lot of international students even before VAT was added.

It's more or less the same story with all these small not very famous schools.

Many of these private schools have also had charitable foundations that effectively helped subsidise the running of the school.

Rendcomb's charity basically said "we can't afford to bail you out any longer" as the school had been running up huge deficits for over a decade even with the charity's huge contribution. Which means it had been running at a sizeable deficit for probably one or two decades before that. It was in an historic building and had huge grounds which cost a ridiculous amount to maintain and three years before COVID, when it was already losing bucket loads of money, spent a couple of million on a new theatre. Mismanaged for years, falling pupil numbers for well over a decade, running at a loss for decades. But yeah, VAT.

Conversely, there are also some new private schools starting up.

As I understand it same same with Exeter Cathedral School.
And some of Exeters' other independent schools have been more popular for years. Quite often an area has more than one private school and compete against each other. Lover rate of births less pupils.

The economics on this particular school in Suffolk were shocking before VAT. Gemini could answer that, no doubt, if asked, as the accounts are publically available.

A number of the schools closing, including the one that I believe the OP is referring to, are Chinese owned. Lots of schools were bought by Chinese companies in the last 10 years and it would appear that current factors, such as VAT, increased employers’ NI and falling birth rates, mean that some have decided that they are no longer a good investment, and possibly that there is more money to be made by closing and selling the school sites. I think that anyone who has a child at or works at a Chinese-owned school should be worried right now - and I speak as someone affected by this. (I hope that this doesn’t sound racist, as it’s not aimed at Chinese people in general, just at the equity companies involved.)

It is a common misconception that all state school teachers must be qualified. Academies and free schools can hire teachers who do not have QTS.

And with more and more schools converting to academies every year, the lack of QTS will not necessarily be a hindrance.

Whether a private school teacher, who is used to teaching small classes of well behaved children and where parents are supportive of the school and its staff, would thrive in a state school, is a different matter, of course.

Unfortunately, many of the children affected by private school closures are at secondary level, where due to historic high birth rates, there is a shortage of school places - and is why some of the parents resorted to private school in the first place. So, whilst there are spare places across the school population, due to birth rates falling, they are in the wrong place, which is something that the Labour Party seem to have missed when they are regularly quoted as saying that there are enough spare spaces in state schools to absorb more children!

It seems that you are focusing on whether a small non-viable private school should close. My question is about the policy itself. There are no inherently right or wrong policies. Shouldn’t we evaluate them based on their actual impacts?

Shouldn't we be examining the direct effects of this policy, not only on students, teachers, and employees in the private sector, but also on the state sector, which may need to accommodate displaced students and absorb teachers who lose their jobs?

We are discussing the effectiveness of a policy whose aim is to raise VAT revenue—-My interest is simply whether this objective can be achieved and what welfare gains, if any, it may generate, I.e. what is the total gain/ benefit of this VAT policy.

Birth rate was mentioned more than once. I think you've misunderstood how the total VAT revenue scales against the average cost increase per state student once the policy reaches equilibrium

Setting the birth rate aside, the core issue is the policy's equilibrium math. Simple Math: Is the total VAT collected from remaining private school students enough to fully subsidise the cost of the incoming pupils transferring to the state sector.

Feel free to refute the assumptions underlying Gemini's “biased” pessimistic projections.

I am not particularly interested in why individual private schools are closing, their business models, or which government is better or which one to blame.

@twinsyang if you want to talk about the policy itself rather than a specific school…

(a) why did you title your thread “Another private school in Suffolk announced closure by the end of the summer term”?

(b) why not join one of the eleventy million VAT threads already running?

My point on confirmation bias and LLMs remains, regardless of the topic of the query to the LLM. I have no interest in refuting Gemini because Gemini is not an intelligence, it’s a pattern matcher that is designed to find an acceptable answer for the questioner.

Btw, even if the government wanted to reverse the policy, it would be very difficult to reverse the trend. Opening a school is much harder than closing one.

See, for example, an article in the FT today:

KPMG wrote a report describing the successful use of AI by businesses. But the case studies turned out to be AI hallucinations.

The report writer wanted to hear about AI successes and the AI model found some successes… by distorting or downright inventing them.

ETA - one example from this:

The KPMG report claimed global wealth manager UBS “integrates AI agents across investment advisory, risk management and compliance monitoring”.

KPMG’s report contained case studies with apparent hallucinations of AI use cases by UBS and health and transit systems

KPMG wrote: “These agents operate within a composable platform co-developed with Microsoft, enabling personalised, efficient and compliant financial journeys.”

A spokesperson for the bank told the FT the assertions were “factually incorrect”.

There is no desire within government to reverse this policy, which was in the manifesto.

In the PEPF poll in late 2024, 54% approved and only 22% opposed (balance were don’t knows) - I haven’t seen any poll indicating a public opinion shift on this.

It’s obviously sad for pupils, families and staff when any school faces closure.

But I’m sure the teachers will find new jobs. It’s a little far fetched to suggest that the (greater than 90% of) children who are state educated are all poorly behaved with useless, disinterested parents.

Perhaps it might be a positive eye-opener for the people who hold this view?

Just more cost for the public purse.

I'm relieved ds finishes this month. We made it through. It'll take decades for the private education sector to recover once we are rid of this govt. So sad.

Plus the loss of overseas pupils and that income stream. I wonder if they will do a cost benefit analysis on this as private school places are free to the LA. Moving to state has a ( admittedly small) cost.

I think with the SEND white paper we are getting closer to the ideal 'one crappy option' for all. Where the parents who once could offord to opt out, the adverage family and the kids with quite significant SEN are all in state classes of 30 with no TAs.

It's not really equality. People like think it is.

I'm not wealthy at all so can't afford private. But I do belive there needs to be incentive to work hard and get ahead and a better life. I don't begrudge the Dr's and barristers

Oh dear. 😀