Charging VAT on independent school fees is a tax on parents - and it doesn't make economic sense

30 May 2024, 12:43

The impact of VAT on our school puts us at considerable risk of closure, as it does for small schools across the UK
The impact of VAT on our school puts us at considerable risk of closure, as it does for small schools across the UK. Picture: Alamy
  • Paul Norton is the Principal of Kings Monkton School

By Paul Norton

The Labour proposal to charge VAT on independent school fees would inevitably make our education unaffordable for some parents, and risk them having to take their children out of the school.

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It would cause serious disruption for the education of those children involved, and this burden would fall on the parents who work the hardest to support their choice of school.

It would be especially challenging for pupils who have failed to flourish in the state sector and have come to our specialist provision at great cost and sacrifice to their families.

This would be detrimental to our whole community – our pupils and parents, colleagues in the state sector, and the wider school community.

Kings Monkton School is a specialist mainstream school for children aged 3-18. We are a small, family run school, that specialises in supporting children with Additional Learning Needs such as Autism, ADHD, Dyslexia, Dyscalculia and Dyspraxia.

Our children are not only funded privately by our parents, but we also receive Local Authority funded children from Vae of Glamorgan, Cardiff, Caerphilly, Newport, Torfaen and Bridgend.

In turn, this will put pressure on local state provision.

We share a commitment to a well-funded state sector, a vision which would be harder to achieve if more funding were required to support pupils who have moved into state schools.

I started my career in the state sector and spent 20 years working in leadership and senior leadership before I moved to the independent sector.

As such, I have a good understanding of the demands and challenges faced by staff in this sector and my move to the independent sector was fuelled by the knowledge that I could not offer such a bespoke provision to vulnerable children, who were effectively being failed – through no fault of the staff – by the system they were in.

Many of the children that come to us, and are funded by both local authorities and parents, do so because there are no places that can meet their needs in our state sector in Wales.

We are proud of our place in the community, and always looking to do more to work in partnership with state-sector colleagues and to improve educational provision for all.

We work closely with NEETS and the Local Authority to offer external candidates a test centre for their external examinations – the only one in South Wales.

We work with local primary schools to develop STEM activities and share our passion for science, as well as conducting creative writing sessions.

The movement by your Welsh Labour Assembly to end our status as an SEN school means that all schools who offer SEN support to children in Wales will succumb to the VAT fee increase.

This puts us at a considerable disadvantage when compared to schools in England.

We are ambitious to make ourselves as accessible as possible to the local community, including through our bursary programme, where we support pupils from low income households with a bursary on top of any scholarships they may obtain through our scholarship examination process.

This can mean that families can benefit from fees which are as low as 10%-50% for their children. We are not a charity, but a not-for-profit school and so the financial effects of VAT will undoubtedly make this work more difficult.

As a school of 290 pupils, we make up around half of the independent schools in the UK, with one quarter of such school have pupil numbers of less than 155.

Within our community of small schools, we contribute £16.5 billion to GDP and have 10,337 of pupils identified as having SEND (18.6%) with 9,620 pupils paying no fees.

This is not the generalised and populist image of Eton, or other such large, selective private schools.

VAT that we would have to pay and recharge back to parents estimated at around £890,000.

We would be able to recover around £220,000 of VAT payments to our suppliers, which would give a Net income to the government of around £670,000 (22/23).

This is equivalent to 85.82 pupils in state education.

Our school makeup is very comprehensive, with 65% of school fees paid by parents, with 66.7% of our parents having a household income of between £25,000-£74,999.

The image being portrayed of private education families, earning large salaries, making the choice to send their children to elitist schools is wrong and very skewed.

Our parents are middle class, hard workers, who chose our school because there is no alternative in the state sector.

The impact of VAT on our school puts us at considerable risk of closure, as it does for the other small school like ours.

If our school closed, the loss to GDP would be £7,751,723, with the loss of 193 supported jobs. HMRC would lose tax payments of £2,137,799 - all this for a VAT payment of around £670,000.

As well as this, the ‘cost’ of pupils moving to state school would be an additional £1,950,831, even if the schools in this area had places for our children.

The logic behind this decision is financially flawed and I cannot see how the possible closure of our school makes any kind of economic sense.


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