private schools near me have reduced their bursary offers??

[Mizmumy]

Hi, very long time lurker- made a post to ask......as not sure I can see anything related to this.

My twins are in year 6. They are both really sporty and doing well academically. They are at the local primary and we applied for the local school. No issue with the school, but we thought to try our luck with a bursary for them both. We live in Surrey, and there are actually more private schools near us than state.

We have applied for the kids to a few different schools but have been refused for nearly all the applications. The bursars have all told us the schools have significantly reduced their bursary student offers for next year. I have friends who work in 2 of these schools and they shared that no bursaries were offered. We were not expecting 100% bursaries, looking at maybe a 10-20% reduction in fees.

Has anyone else come across this? Thanks for your answers if you have any?

This is the sad and ironic impact of adding VAT to school fees. Schools have a limited ‘pot’ of money for bursary provision. Making the fees 20% more expensive means that more people need financial support and that schools are also trying to cut costs in order to soak up some of the 20% increase for parents. This, combined with the loss of business rates relief, employer NI contributions and increased fuel costs mean that smaller or less wealthy schools (which have to run as viable businesses) are being hit hard and can no longer help as many families.

Meanwhile, the super-wealthy schools like Eton are making money - they are passing on the full 20% increase to parents, knowing that they have plenty of other super-rich families to fill places if any are lost by the wayside and are claiming back VAT on their enormous capital expenditure.

Thanks for responding. I thought as 'charities' these schools had to offer bursaries. But maybe I was mistaken.

Where do you think the money comes from? Schools are run on fee income.

Many schools are using their bursary pots to support kids already in the school who already have bursaries and can’t afford the VAT increase (many schools are using their funds to pay the VAT for existing bursary recipients, which is fair enough as those parents won’t have the means to pay the additional VAT - hence why they had the bursary in the first place!)

It’s a rubbish situation and the whole VAT policy won’t raise the money the government promised and could even cost the taxpayer money in the end. It’s a shit policy and you’re on the sharp end of it, unfortunately :(

I don’t know Surrey schools very well (I’ve only ever taught in Welsh and South-West independent schools) but I would imagine that some of the really big-name, historic schools still have healthy bursary pots. Cranleigh etc?

I heard most of the bursaries are reserved for those who are gifted at playing tiny violins

Not all private schools are charities, but those that are need to provide a public benefit and be run not for profit. Bursaries are not a requirement for maintaining charitable status, and as @Chickoletta points out many many private schools are having to reduce bursaries in order to cope with Labour’s policies.

“Meanwhile, the super-wealthy schools like Eton are making money - they are passing on the full 20% increase to parents, knowing that they have plenty of other super-rich families to fill places if any are lost by the wayside and are claiming back VAT on their enormous capital expenditure.”

Schools like Westminster and Eton are not making money out of it. They are passing the VAT on to full fee paying parents precisely so that they can keep doing bursaries. Damned if you do, damned if you do not.
Schools that can only attract parents by cutting costs, have to cut costs including bursaries. Schools with big brands like Eton/Westminster are trying their best not to cut costs, but are being undercut by other schools with equally big brands like St Paul’s boys.

They will make a profit ultimately due to being able to claim back 20% VAT on any cap-ex from a backdated period - not sure how long, I think it’s 10 years. This info came from the Bursars’ Association conference so quite reliable!

@Mizmumy - I think they have to offer public benefit. And if they reach more state school pupils rather than a handful of bursary students, that will be sufficient and actually make more sense anyway. 10-20% off was never really a bursary, more a “scholarship”. Our local private school is still offering scholarships this year, I think up to 30-40% for kids who get academic and co-curricular scholarships. But that means two grade 8 on instruments or at least county sports with a view to National plus a really high academic standard.

@Chickoletta - it is not a “profit”. Both Eton and Westminster invest heavily in state schools and bursaries and see their role as doing that and playing their part in Education as a whole, regardless of a temporary Labour Government. They have been around for hundreds and hundreds of years and they are not going to let this flavour of Labour destroy what they believe to be their ultimate role in Education.

They may make a profit initially on the 10 year backlog of capital expenditure but that's a one-off, it will be year by year after that.

I'm not at all surprised this is happening, the schools that are charities by definition won't have huge reserves because they have to spend their income on educating children. Other costs are rising too, NI, teachers pensions if they are still in the TPS, utilities.

Public benefit can be through, for example, making their sports facilities available to local schools and communities, or some of their teaching staff working with other local schools. There will be a lot less of that too

Bursary funds are usually separate to fee income and school running costs. However they may have reallocated more funding to existing pupils affected by vat. I would not pay much heed to your intell though, they certainly should not be talking out of school.

There are many private schools that are not charities. Some are owned by hedge funds or private companies.

Older schools (over 100 years old) are more likely to be charities, but look carefully in the small print of the websites to see.

You're quite right @Chickoletta , and doesn't this show how stupid this VAT policy is?

As has been pointed out to you @Mizmumy it's the private school parents, through fees and donations and fundraising, who provide the money for bursaries, I guess everyone is feeling a little less profligate at the moment.

This is the consequence of the VAT grab. People cant have it all

Good!! Our school has said they are not financially supporting any new students entering the school and will focus on current parents.

Well what a surprise! Schools were never going to be able to ask existing parents for more and more to fund bursaries. Especially when, in my experience, they go to middle class types who are pushy!

My 3 kids are at private school in Greater Manchester and the school announced this week that the number of bursaries for September is massively reduced.

You can thank Starmer and his cronies for this.

I also think OP if you were only looking for a 20 per cent reduction per child then you are probably just in the same boat as all the parents complaining about VAT who can not afford the extra 20 per cent now. And they are already stuck in the system with their DC happy and settled. So count yourself lucky that you were not caught up in this and go to the state school and save the extra cash for their sports and top up tutoring.

For every child that has a bursary there are 20 others who are just as talented who could have been just as good with the right opportunity.

Private school is a luxury, and this is only going to become starker with the VAT.

I suppose we all have to cut our cloths, and if you can't afford it without a bursary it's a luxury you can't afford sadly.

Even if a school is a charity they don’t have to offer bursary funds, it will depend on their charitable objects.

And pp have said, and loads of people on many posts before is that one of the clear, known and obvious impacts of the VAT will be that any bursary pots funded by the schools through their fee income would potentially be significantly reduced as they try to retain their current paying students by way of absorbing some of the VAT (and then NI and business rate increases) through any surplus or reserves they have.

Not all independents are rolling in it, and Covid hit a lot already.

To get a sense of commitment for bursary/scholarship aims the schools charity accounts usually will talk about it (ie 10% of students or 15% of fee income given back in fee remissions or something like that as well as number of students on bursaries) and / or you can usually see linked charities which then may flag specific endowment funds linked to the school (the latter means they most likely have a separate pot of money for bursaries / scholarships that they can draw from).

These data points are more likely to give you a better and real feel on how much they actually give, potentially their aims / aspirations re the number they give and also see trends year on year.

I strongly recommend people do this research which is easy to do before signing their kids up for indie exams to have a realistic idea what actually has been offered by the school and what the current mood music is for that school.