No VAT on private school fees this year

I guess that buys them time to expand resources in the state sector before the tax kick in.

Labour won't apply VAT  to private school fees until the academic year starting  September 2025.

As I understand it state schools are mostly under-subscribed at the moment because we are going through a demographic down turn (in between the echos of the boomer generation) so I dont think accommodating the extra kids whose parents cannot afford to pay VAT will be a very big deal or very costly.

Sorry Guy, are you saying there are teachers in state schools right now sitting around with not enough to do who are ready to take up the  slack?

I don't think that's right.

Guy while I accept there are regional differences - in London that's most definitely not the case. The states schools where we live are all over subbed, operate on a lottery place basis and range from diabolical to shit. 

The volume of children hitting the state system vs what the policy raises reduces overall student spend. I'm as working class as it gets and will vote Labour but this is a shit policy. 

Which school will be first to offer incentives to pay multi-years in advance at 'favourable' rates and then funnel the cash offshore before declaring bankruptcy and scarpering with the loot? 

Dont be a aunt RR. 

 

Those kids are still kids who through no fault of their own are having their education disrupted, friendship groups broken etc. They are just kids remember. 

George, they will barely even get their first budget out in 2024. 

They think it's going to take at least three months to get a fiscal event through the OBR and it will take them a couple of months to write it up first once they've cut out the pledges they aren't planning to keep. Thye have also confirmed there will be no emergency fiscal events on election.

So no budget till November at the earliest and "as soon as possible" after that means next September.

You don't generally change tax rates during a fiscal year and the tax points for vat will be linked to the time of supply so September 2025 makes perfect sense 

My point was simply that's quite a lot of kids to accommodate at relatively short notice especially as some of them will be concentrated in particular parts of the country.

I think people with children already in private school will suck it up to avoid disruption.

New intakes will be interesting. If it is Sept 25 rather than Sept 24, parents will have time to organise/ take steps to avoid the local comp if it's too stabby for their little darlings.

Some schools do a lot with bursaries for means tested, bright kids. 

 

Would make sense to charge 5% rate where more than 30% of fees ploughed into actual charitable work, and 20% for the rest. 

I firmly believe that state schools with an intake of private school kids (and their pushy parents) will on average do better as a result, even if there is no increase in budget and class sizes are very slightly bigger.

Dont be a aunt RR

These kids will be better off in state schools medium to long term. 

I'm not having emotional blackmail over an equality policy. "won't somebody think of the more wealthy kids?" Piss off with that. 

Jelly, it won't be in place this September. 

They have confirmed that are not going to change any Tory fiscal policies until the OBR have run the numbers. 

 

That means no tax rates will be changed at all until at the earliest November

"These kids will be better off in state schools medium to long term."

ROFL. I don't think even Guy would agree with this.

People are literally snubbing a free service, i.e. state schools, for a paid service. Why on earth would they do this if their kids will be better off in state schools?

"until the OBR have run the numbers"

Query what the OBR will say about Labour's assumption that the numbers leaving the private sector will be minimal. 

And what they will they say about the non dom policy? The Warwick Uni study which the policy is based on is pretty laughable.

Private school kids in state school may be "better off" in terms of being better integrated in the society they live in but academically this seems to be unlikely.  Their parents are paying for them to have an unfair advantage over their peers in terms of educational resources and networking opportunities so take that away, and no they will not be better off academically or career-wise in most cases

GOOD.

And we all know that when they win middle class seats in the south en masse, this policy is going wholly by the wayside.

EVEN GOODER.

Rather depends on where they end up at school instead.  I get the impression that the parents' group at your average Wimbledon state school gives you some pretty good networking opportunities these days.

I have yet to find a use for my old school network in a professional context.

Parents do all sorts of stuff. Talking to their children, buying them books, private health care, tutors, football camp, tutors, music lessons. I'm tuglite about this. It smells of envy. Private education is a business that's being penalised, but it's also a business that shoulders a large amount of the state's burden. 

 

Vat will generate £3500 per kid, but any that move to the state sector will cost the govt £8000 each. And if you remove more than 10% of the kids from a private school, it becomes loss making. There's a real potential for carnage in this. 

Jelly, where on earth do you get the idea that the marginal cost of an additional pupil in the state education system is £8,000?  That may be the cost per pupil overall but increasing the student body by a couple of percent will cost far less per head as existing schools will be able to absorb them, just as they have when we get demographic bubbles.

Sir Woke, you should be happy about this policy.

IIRC you bought in an area with grammar schools. I think I remember posting on the thread where you decided it. You'll now get London parents pushing up prices in the area, to avoid London comps.

London state schools add the most value of schools anywhere in the country by a considerable margin, avoiding London state schools is more about (largely) sub-conscious racism and snobbery than a rational decision about educational quality.

Rightly or wrongly, it is unrealistic to expect that parents forced out of the private sector will send their kids to a school of this type:

https://southwarknews.co.uk/area/bermondsey/pupils-at-a-bermondsey-school-are-being-trained-to-treat-stab-wounds/

Parents will be off to Kent like a shot, I'm afraid, including left-wing parents, whose principles will dissolve pretty quickly when applied to their own little darlings.

I concur with Jelly that a lot of schools are operating at the extreme limits of viability, made worse by the TPS contribution rate increase in April.

A 10% drop in attendance due to VAT may well be an effective 100% drop shortly after as the school shuts permanently.

And it is all very well Labour saying they can cut costs, but teachers salaries and pensions are the largest single cost, followed by premises. Anything else is simply at the margins.

5% larger class sizes by absorbing current private school kids with no additional resources would still make state schools better than they currently are but even though no doubt resources will be increased it will be nothing like by £8,000 per additioanl pupil and nor will it need to be.

Guy, every child on a state school's roll in October attracts at least £7,500 to the school for that school year.

That is real money coming from somewhere.

“5% larger class sizes by absorbing current private school kids with no additional resources”

here speaks childless man banging on on subject he knows nowt about

wind your neck in immediately 

Of all the things there are to care about, middle class pushy parents and their offspring are fairly low down the list. Probably the voters Labour really want to win back will agree with the principle but not be massively interested. 

I hope that special needs schools are not penalised, but otherwise, I'd rather hear plans for the majority of schools.

People are literally snubbing a free service, i.e. state schools, for a paid service. Why on earth would they do this if their kids will be better off in state schools?

Because posh rich people are often very thick and not able to see beyond their own experiences and what their parents did with them.

Come on YWTF, you can't seriously believe that state schools are better. As I said to RR, not even Guy believes this. If nothing else, what about class size of 15 vs class size of 30?

Some state schools are better but they are very hard to get into unless you are posh, rich and actually very clever.

And you've still paid a lot of money tutoring your children how to pass the entrance papers.

Haven't even thought about national service as the Tories would need to win the election, which isn't going to happen.

We'll just have to see where this VAT policy goes. It was a complete sh1tshow when they tried it in Greece. I don't think anywhere else has even tried.

In practice, I wonder if the schools without large investment portfolios (i.e. most of them) will shelve charitable status in order to stop paying bursaries, and use the savings to hold fees down. So the policy will "work" but only by, in effect, kicking poor children out of private schools.

Guy is working on the "they can just budge up and there's no extra cost" hypothesis that is wishful and wrong. 

I didnt say there would be no extra costs, I said that the marginal cost would not be £8,000 per head as you posted above

@ playftse I doubt even the super-selective* grammars are as good as a decent private school. There's no getting round the fact that the class sizes are double. They get good results because they have smart kids.

* going to get even more selective soon as parents pile in.

As someone else pointed out though that is the real cost to the government. The schools will spend that money and then come back asking for more, be in no doubt.

It seems odd that private school fees have gone up by far more than 20% in real terms in the past few decades without a significant fall off of numbers attending and yet the VAT increase will immediately mean millions will no longer attend private school and over run the state schools.  Sounds like a bit of a self serving argument to me...

George, decent private schools are also super selective. So much so that quite often one sibling gets in to school but they reject the next one for not being up to it. 

For most of them their entire model is based on selecting the brightest children  thst can afford the fees so that their results look good. Good results recruits other rich brainy parents amd the teaching then doesn't even have to be particularly spectacular.

The ones that aren't so decent are less fussy.

 

Guy, that's absolute rubbish that private schools just provide advancement/networking rather than a better education. If anything these days there is a real advantage to going to a state school as Unis and workplaces tend to positively discriminate (I regularly take part in Vac scheme processes and those applicants with private schooling have to perform much better then their peers to get through). The reality is that the education provided by your average private school is much better than the equivalent state school and I'm not willing to handicap my child's development based on an ideological principle.  

Well, we'll see relatively soon what actually happens. I don't think anyone on either side of the debate can say with any certainty at the moment.

Only one precedent for anyone trying this anywhere in the world (that I'm aware of) and it was a sh1tshow:

https://www.economist.com/europe/2015/10/30/greece-reconsiders-a-tax-on-private-education

I think the EU shut it down anyway after the initial problems.

My guess is that bursaries will be cut - maybe not immediately but after a few years.

We won't see relativley soon though George. This experiment in social engineering will take 20 years to provde conclusive results.

It will take a whole generation to work through and it only starts from September 2025 .

It seems odd that private school fees have gone up by far more than 20% in real terms in the past few decades without a significant fall off of numbers attending

There has been a huge change in the demographics of the kids going to the private schools which have massively ramped the fees up.  My old place is now full of international students who have filled the spaces left by middle class professionals who can now no longer afford it.  On top of that parents might sweat to cover an extra 20% going on better facilities, etc. but will take a different view of a 20% jump with that money just going to the Treasury.

"We won't see relativley soon though George."

We may get an idea of the direction of travel from the Sept 25 intake figures. I wonder if parents with kids already in school will suck it up to avoid disruption.

"My guess is that bursaries will be cut - maybe not immediately but after a few years."

My guess is that will be the last thing to be cut,   they will be walking on egg shells around a Labour government to avoid loss of charitable status.

Guy, I assumed loss of charitable status. I wrote this:

"In practice, I wonder if the schools without large investment portfolios (i.e. most of them) will shelve charitable status in order to stop paying bursaries"

The point is: what will charitable status give the schools in financial terms? Exemption from corporation tax on investment income, and gift aid relief.

Eton etc will have significant investment portfolios and so this will be very valuable.

However, most private schools aren't like Eton. They derive almost all their income from fees. So the savings from cancelling bursaries and anything else they do for the community may outweigh the loss of corporation tax/ gift aid relief. The question is how many schools will either choose to do this or will be forced to do it even if they don't want to. Also query how easy it is just to decide you aren't going to be a charity any more. Don't know about this and I think private schools are constituted in a quite a few weird and wonderful ways.

The reason I said "after a few years" btw is that I think the schools' initial reaction will be "not cutting bursaries, fundamental to our ethos, etc etc."

Then they will realise they don't have any money and the axe will come out.

"If only there were some private client lawyers on Rof"

there was someone posting on this last year who seemed to know what they were talking about - can't remember who. That's where I got the part about how private schools were constituted from. I think they mentioned some of them were even constituted by Royal Charter.

Come on YWTF, you can't seriously believe that state schools are better.

Depends where you are.  My kids will be going to a great state school which finished above several independent schools in the area in the recent Times tables.

But tables don’t take into account kids who go to private school not learning to mix with people across society, and basically only ever being exposed to horrid little spoiled entitled shits who think it’s fine to buy privilege.  Can’t think of any circumstances I’d send my kids there, no because of prejudice but because of the kind of person they’d come out as.

I just find this whole debate just so ironic. 

We can only have this policy implemented coz of Brexit, which SKS did his utmost to scupper/delay in the first place. 

“account kids who go to private school not learning to mix with people across society, and basically only ever being exposed to horrid little spoiled entitled shits who think it’s fine to buy privilege. “

You don’t actually know any people who aren’t millennials like you who spunk all their money on flash cars and flash holidays do you, you mad c unt?

Nobody who isn’t rich can afford to send their kids you mad khvnt.  

Yup and most of the posh are no longer rich enough to send their kids to their old schools.

"London state schools add the most value of schools anywhere in the country by a considerable margin, avoiding London state schools is more about (largely) sub-conscious racism and snobbery than a rational decision about educational quality"

This is utter utter bollocks and shows how little you understand about inner (ISH) London poverty. State schools in London are mostly utter shit. Early finish on Fridays 2:25, no meaningful co-curricular, no after school clubs and of course metal detectors on the gates. Many don't have 6th forms. This policy will do nothing to make those schools better. There's no focus on learning just getting as many kids as they can to minimum English and maths standards - which is commendable  by the way given the breadth of intake.  Its just a shit policy regardless of ideology.

 

The best research saying this policy is a net revenue generator (bearing in mind VAT raised, VAT deducted, increased state spending etc etc) - it should increase spending on state education by 2%. Regardless of whether it actually raises net revenue, it should reduce private provision of education, which is a good thing (society would be more meritocratic).  

People are literally snubbing a free service, i.e. state schools, for a paid service. Why on earth would they do this if their kids will be better off in state schools?

for the same reason that they drive a range rover instead of a mondeo. Because they can, it's part of the culture they live in, and is a wealth indicator.    

On the charity point, schools that are currently charities can’t just decide to stop being charities. They hold their current assets effectively on trust for the charitable purpose of advancing education for the public benefit. If they stop pursuing that purpose or operating for public benefit, their charity trustees will be in breach of duty and potentially personally liable for any resulting losses to the charitable assets (eg through failure of corporation or income tax reliefs due to not operating charitably). Maybe some schools have unusual governing documents that might give them some wiggle room, but for the majority this isn’t going to be an option without doing some sort of deal with the government / Charity Commission to enable conversion away from charitable status.

You don’t actually know any people who aren’t millennials like you who spunk all their money on flash cars and flash holidays do you, you mad c unt?

Why would I?  They sound mega boring. And still rich by any rational measurement 

What’s money for if not for enjoying by the way?  Cars are class. Holidays are class. Saving every penny to send your kids to a school so they’re the poorest w**ker in a class full of w**kers doesn’t sound a very sensible strategy. 

I can't wait until they put VAT on public school fees and they should also add a tw4t tax on top...hideous places that churn out self-entitled kids with an over-inflated view of their abilities and yet very little ability to see the world outside their own.

It really does depend where you live YWTF. From what you have said on here it sounds like you live in a very nice suburban or semi rural bit of the UK. That is incredibly different to living in central London or most other UK cities when it comes to schools. 

Yeah maybe it is, DDS.  But the only way state education will get better is when all the wealthy relatively bright and nurtured kids are educated with everyone else and their influential parents don’t ignore it as an issue they don’t have to worry about. Ban private education 

I agree with you in principle YWTF, but in the end I wouldn't risk my kid's education (and frankly personal safety) by sending them somewhere sh1t as some sort of political act. Moving to a nicer area is get access to better schools is no better (frankly it is worse) than sending them private in terms of the impact on the problem you describe. 

It's a weird one to go so hard on. Keir has been at great pains to avoid any vote-losing controversy.  He's been absent on Brexit, ambiguous on immigration, trans etc. 

But here he is, going two footed on a subject that will alienate close to 100% of fee-paying parents and their grand parents. 

 

I get a lot of the grandparents are Tories. And probably many of the parents. But certainly the parents are the already-alienated centrist Tories. Ripe to move. 

 

And it not just a policy that they have some ideology around. It's £3500 (and maybe 2 or 3x that). 

 

Weird to be going so hard against, let's say 14% of floating voters. 

Moving to a nicer area is get access to better schools is no better (frankly it is worse) than sending them private in terms of the impact on the problem you describe. 

Maybe you were talking about your options, but I didn’t move because of school catchment areas, didn’t even cross my mind. Just FAOD

The needed some red meat for the base Jelly and I think you radically over estimate how many parents who send their kids private are really floating voters plus those who ARE floating voters will likely mostly live in London and Labour already has London in the bag. 

It's a demographic they can afford to ignore and so they have hit them hard. 

YWTF - I was talking about my other options if we lived in the UK. I get you didn't move to get access to better schools but then it sounds like you don't need to.