An open letter to Labour leaders: VAT on school fees.
Dear The Labour Party ,
Please reconsider your plans to add VAT to school fees in Britain. You will be punishing the very people that you seek to support – hard working families.
Adding VAT to education will hinder the potential of our next generation; going against your mission to break down barriers to opportunity and inadvertently increasing the social divide that exists within Britain.
Your chosen wording of ‘ending tax breaks for private schools’ paints a picture which couldn’t be further from the truth. I imagine you are hoping that the British public will visualise the likes of Eton or Harrow, the ‘posh’ schools; whose fee-paying parents you have painted as tax-dodging, toffee-nosed and privileged.
In reality, you would be adding VAT to the education of young people from hard-working families who rely on independent education to meet the needs of their children.
The majority of families who choose independent schools are not like the picture that you paint. They are not elitist, supercar driving, off-shore squirrelling families that you have in your mind’s eye. Let me tell you a couple of stories about families that I know of personally, who would be affected by this decision…
(Names changed for privacy)
The Stewart family – A young professional couple and their two children, Lilly (11) and Ava (8). Like many families, the couple work full time and juggle life with young children as best they can. As was the norm to them based on their own upbringing, Lilly and Ava attended their local state primary school from reception age. Lilly was labelled as ‘gifted’ and Ava labelled as a ‘reluctant reader’ after falling behind her peers following COVID; both having their own educational challenges that the school did not (and could not) support adequately.
Wanting the best for their children, Lilly and Ava’s parents explored alternative education options. They discovered a local independent school that could support their children in the ways they needed – but to put their children’s education first and pay for this, changes to their lifestyle had to be made. As a family, they made a decision to sell the car, economise on food shopping, forgo holidays, cancel gym memberships, seek free days out and leave expensive Christmas’s behind them. They chose to relinquish many of the things that professional families can typically afford to do; on top of working additional hours where possible.
The girls are now thriving in school, their additional needs are fully understood, and they have support in place to allow them to flourish. The proposed 20% increase to two lots of school fees will snatch this away from the girls – it will no longer be possible for this family to support the needs of their children.
Aarav’s mum - a secondary school teacher, had a tough decision to make after Aarav experienced significant bullying at school. The bullying had a profound affect upon Aarav’s physical and mental health. Aarav’s mum didn’t hesitate in removing him from the school and did all that she could to protect him and build up his confidence, with the help of their local independent school. Aarav is not at school with the children of the rich and famous, but at a school with children whose parents are teachers, doctors, nurses, lawyers, accountants – hard working professionals giving back to their local community in so many ways. Many of whom wouldn’t be able to stomach the additional fees of (in this case) £3,000 per child, per year in VAT; likely forcing the school to close, the burden falling upon the already over-crowed nearby schools in the city, and the government to foot the bill.
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Labelling ‘private schools’ as you do, leads to a misconception that these schools are exclusive, invite only, members clubs - when in fact they are schools set up to provide an alternative to mainstream education. Schools that can support children with additional needs in a way that allows them to be included in education and not left behind.
If you choose to impose VAT on children’s education, the knock-on effect on the educational system would be catastrophic for all our children. Currently, fee-paying parents are paying their everyday taxes to cover the state education for other children.
Labour; the result of your decisions would not mean that you will be gaining even more money from these hard-working families to make state education better, but they themselves would turn to state education for their children.
Could the current education system deal with an influx of up to half a million more children?
Do the schools have the capacity to teach this number safely?
Do they have the physical space?
The cost of educating these additional children within the existing education system would account for a much greater cost than you seek to retrieve, with very few left in the independent education sector to pay for it… and this is without consideration of taxes paid by the people currently employed by independent schools.
The independent sector educates approximately 620,000 children in over 2,500 schools (Independent Schools Council).
By choosing to add VAT to education, you are choosing to directly risk the future of more than half a million children in the UK and indirectly jeopardise the very education system which you seek to save.
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9moThe thing I find most frustrating about this is not so much the principle itself which is hard to defend in a lot of ways, but the inevitable consequence. It's probably doom-mongering to assume that thousands of independent school kids will flood the state sector, though it is likely to impact. It's more that the gap between the privileged and the rest will widen. Wealthy parents will not feel the increase particularly, but their off-spring will benefit further from smaller class sizes. Schools will have to demonstrate even greater value-add to attract and retain, meaning the exclusivity and premium nature of them will increase further (this is already happening) Schools will continue to chase wealthy foreign parents to make up for the shortfall. So the number at the top will reduce but become more global and the 'old boys network' will become even more exclusive and closed resulting in even more wealth and privilege held by even fewer people. The best solution as I see it is to tax the fees themselves allowing the smaller, less expensive ones to survive. There should also be more measurable 'charitable' engagement. Schools that can demonstrate their role in their communities should retain their status.
Chartered Financial Planner with Gracechurch Wealth Management and Magma Wealth Management (Appointed Representative) *All views are personal to me.*
1yGreat letter Anna, sadly I think the Labour party does understand all the points and examples you eloquently make, perfectly well. However that gets in the way of the message they want to send out, that satisfies and feeds the hard left of the party. In my own opinion, this is old Labour style politics that reverts to trying to level down instead of leveling up.
This is an eye opening letter around the realities of private schools. Spot on summary and examples shared. No one will benefit it this goes ahead.