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VAT on school fees policy will raise ‘tiny amount of money’, IFS admits
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Independent sector
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The government's VAT on fees policy will not make “any real difference to the amount of money available” for state schools, Paul Johnson, director of the Institute for Fiscal Studies (IFS), has said. In a 90-second YouTube video from November last year, Mr Johnson states the 20 per cent levy on school fees would raise “tiny, tiny amounts of money”, adding: “You might want to do this for reasons of social justice or equity, or because you think it is appropriate to charge VAT on school fees, but don’t be fooled into thinking this is going to make any real difference to the amount of money available for public services.” Labour has relied on the work of the IFS to justify its tax plans, after the think tank published a report in July 2023 claiming the VAT policy would raise up to £1.5 billion each year. The Independent Schools Council (ISC) has warned that the number of pupils leaving the independent sector could be much higher than the report estimated, with enrolments falling by 10,000 pupils in September 2024 - meaning the policy could generate far less revenue than expected. By Pieter Snepvangers, The Telegraph.
In an article for PoliticsHome, Labour MP for York Central Rachael Maskell says independent schools have become part of a "safety net" for children with special educational needs and disabilities (SEND) who have been "failed by our broken state education system". Ms Maskell stresses the necessity of diverse, inclusive, and therapeutic school settings, and warns that policies such as the government's VAT on fees pledge could exacerbate the challenges faced by vulnerable children and their families. Urging the education secretary to "rebuild an inclusive education system that every child can access", she writes: "Placing VAT on fees was a step too far. The parents are stressed. They can’t afford the fees uplift. There are no suitable alternatives. This is not parental choice but necessity." Describing the concerns of some members of her own constituency, Ms Maskell adds: "Parents of SEND and anxious young people are already at their wits’ end, fighting every moment for their child."
Writing in Independent School Management Plus, Andrew Murfin says independent schools will need to have resilience and determination as Labour's VAT on fees policy comes into effect. Outlining some practical steps that schools could take amid increasing financial pressures, he advises schools to "develop new strategies to remain sustainable and deliver compelling outcomes". On the policy's negative consequences, he warns: "Additional financial pressures – such as the loss of business rate relief or increased NI contributions – could force some schools to throw in the towel. A disaster for the sector, the school, the people that work there and, importantly, the young people educated in these establishments." Andrew Murfin is deputy head at Danes Hill School.
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House of Commons written questions: VAT on fees policy and SEND
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Political
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In a House of Commons written question, Conservative MP for South Shropshire Stuart Anderson asked the education secretary what steps she is taking to help ensure that the introduction of the VAT on fees policy does not negatively impact the academic progress of children with special educational needs and disabilities (SEND). Responding, Minister for Early Education Stephen Morgan said the government aims to enhance opportunities for children with SEND by improving inclusivity in mainstream schools, supporting special schools, and increasing funding for special needs education in the coming years. He continued: "Pupils who need a local authority funded place in a private school, including those with local authority funded education, health and care (EHC) plans, will not be impacted by the changes. This is because local authorities can reclaim the VAT that will be charged. Most children with SEND, including most with an EHC plan, are educated in mainstream state funded schools. All state funded schools support children with SEND and all children of compulsory age are entitled to a state funded school place that is free for parents. Where a private school place is necessary to support a child with SEND, the local authority will fund it through an EHC plan."
In a separate written question, Conservative MP for Harborough, Oadby and Wigston Neil O'Brien asked the education secretary if she will publish the information that informed her department's assessment of the potential impact of the policy on pupils with SEND moving to state schools. Stephen Morgan responded, stating that the Treasury "has published an assessment of the impacts of removing the VAT exemption that applied to private school fees". On the effect the tax changes would have on pupils with SEND, he added: "There is no separate assessment by SEND." Hansard.
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Use SEND funds to boost mainstream inclusion, councils told
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SEND
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Local authorities should use extra funding for special educational needs and disabilities (SEND) provision to boost inclusion in mainstream schools, ministers have said. Published yesterday, the Department for Education’s guidance on how to spend the money in 2025-26 says the government has "made it clear" that the general direction of SEND reform is towards more inclusive mainstream provision. By Samantha Booth, Schools Week.
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Australia to ban under-16s from using social media
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Online safety
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Australia will ban children under 16 from using social media, following parliamentary approval of laws that could result in tech companies facing fines of up to £25.7 million for non-compliance. Prime minister Anthony Albanese said the legislation, which will not take effect for at least a year, is needed to protect young people from the "harms" of social media. By Hannah Ritchie, BBC News.
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The Independent Schools Council (ISC) monitors the national and educational press in order to keep independent schools up-to-date with relevant education news. The DNS is a service primarily for schools in membership of ISC associations, although other interested parties can choose to sign-up. We endeavour to include relevant news and commentary and, wherever possible, notable public letters. Where capacity allows, we may include links to ISC blogs, press statements and information about school or association events. News stories are selected based on their relevance to the independent sector as a whole. Editorial control of the DNS remains solely with the ISC.
Sign-up to the email service is available on our website.
Members can contact the ISC if they know in advance of news, letters or opinions that are likely to feature in the media, or are aware of existing coverage which they would like to see featured in the DNS.
Headlines and first-line summaries are written by the ISC with the link directing to the source material. You should read and comply with the terms and conditions of the websites to which we link.
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