The Education Tax and Independent Schools: at the heart of the debate has to be the well-being of the children who will be adversely affected by this decision – not dogma, ideology and prejudice. Government should think again.
In advance of the House of Lords debate on 5th September- – when speeches will be time limited and short – I have written to the Government Education Minister in the Lords, Baroness (Jacqui) Smith, urging her to explain what assessment has been made about the capacity of schools to manage pupil migration and to say:
- What contingencies has the government put in place if pupil migration exceeds current expectations?
- How will the government ensure children preparing for examinations have continuity of education:?
- What resources is the government preparing to manage the increase in Education, Health, and Care Plans?
- Has the government considered mitigating the impact on smaller, more affordable independent schools or do they view these schools as acceptable casualties of their policy? And, if the latter, have they assessed which schools are at risk of closure and put in place specific local contingency plans to deal with significant local pupil migration?
- Has the government considered mitigating the impact on armed forces families? Will they increase the Continuity of Education Allowance by 20% to cover fee increases?
- Has the government considered mitigating the impact on professionals working non-nine-to-five jobs, who rely on the wrap-around-care provided by the independent sector?Has the government assessed the potential impact on critical workforces?
- What assessment has the government made on the potential for this tax to worsen inequalities, particularly for single mothers?
- What assessment has the government made of the impact of this taxation on social mobility?
At the heart of this policy is the negative effect it will have on children and their families. Instead, dogma and ideology and antediluvian battles from another era seem to be dictating and driving the Government’s approach.
The debate around the proposed Education Tax on Independent Schools should centre on the well-being of the children who will be adversely affected by this decision.
What is clear is that there is no good way to know, in advance, the extent of the impact that introducing this tax will have on independent schools. Nor whether it will lead to a net tax gain or net tax loss. It would be misleading to claim that a tax gain is certain, or even likely. The Adam Smith Institute calculates that it could ultimately have a negative impact on revenue – reaching a staggering £2 billion.
Parents who have chosen to spend their money (after paying their tax towards State education) on education for their children will likely continue to do so. If they can no longer afford an independent school they will be left with three options: private tuition (often VAT exempt), purchasing a house in a ‘good’ catchment area (leading to a small amount of stamp duty and a net tax loss through the cost of state education), or reducing working hours to directly support their children’s education.
A net tax loss is therefore well within the margins of error in a model and is also anticipated by the Institute for Fiscal Studies. At the very minimum, the tax may well be ineffective.
What is clear is that independent schools have already closed and it is therefore highly likely more will be forced to close in the year ahead. We also know that when Greece introduced a similar tax (in 2015), schools were forced to close, whilst others passed the tax on parents.
The schools facing closure are not the large, affluent institutions serving the ultra-rich, but rather the small independent schools distinguished not by the quality of education they offer, but by their nurturing and pastoral care. Consequently, this tax will disproportionately impact middle-income families who will struggle to afford the increased school fees resulting from this tax.
Furthermore, this tax will not impact wealthy families who pay for education through property purchases in sought-after school districts. It will neither equalize educational opportunities nor enhance the quality of education. Families who send their children to independent schools already pay for education twice. To add a further tax – which is not means-tested – will only increase educational inequalities. 7% of children attend independent schools. That’s not the ultrarich – it’s one in fifteen families.
State-sector quality of education varies considerably (ranging from inadequate to outstanding). Staff-to-pupil ratios are not well-correlated with the quality of education (state schools all have similar ratios, regardless of rating), so increasing the number of teachers will not necessarily improve the quality of education. Rather, access to good schools is the driving force behind education inequalities. Taxing the independent sector and making private schooling less affordable (and so less accessible) will therefore only worsen those inequalities.
The multitude of letters we have seen from parents paints a stark picture of who will be most adversely affected by the introduction of this tax. We’ve heard from men and women in the armed forces, whose families make use of the Continuity of Education Allowance. Their choice is to either destabilise their children’s education and social circles, subjecting them to the disruption of regular school moves, or exit military service. This is a tough decision which will see both those children and this country losing out.
We’ve heard from professionals, including those working in education, policing, and healthcare, who rely on the wrap-round care provided by many independent schools, which is often uncertain or absent in the state sector. We’ve heard particularly from single mothers for whom independent schooling is the only way in which they can maintain employment. It is their children whose education will be disrupted and who will have to start building new friendships, and it is those vital public services who face losing talented staff who cannot work without that care provision.
We’ve heard from recipients of scholarships and bursaries; families who have low and modest incomes, who fought and negotiated to provide their children opportunities which they did not have. There are ten thousand children educated in independent schools who pay no fees. When the government tells private schools to make savings, is it those children they have in mind? The Government have told independent schools to reduce their costs “like any business”. This comparison is, of course, entirely inappropriate because no business means-tests giving away their services. Unlike independent schools! So reducing costs “like any business” would imply the independent schools should be cutting their assisted placements, worsening educational inequalities. Maybe the Government has in mind the 168,000 children who receive financial support from the schools to enable them to attend?
And we’ve heard from parents of children with special educational needs and mental illness, who report distressing accounts of their children being bullied in the state sector, insufficient responses from schools, and the inability of the state sector to meet their child’s needs. For them, they saw no choice but to sacrifice financially to send their children to independent schools. Does the government recognise the risk that this tax poses to those children?
Finally — introducing this tax mid-way through the school year, on timeframes accelerated as compared with the original policy, adds further injury to these children who will struggle to integrate into new schools mid-way through the year, who may have to change curriculum, exam boards, or subjects, and who will therefore find themselves in a very vulnerable position.
This taxation is ineffective – it likely will not achieve its aim. It is unfair — it will likely worsen educational inequalities. And, it will negatively impact children at a particularly vulnerable time. The Government must urgently commit to safeguarding children moving back to the state sector.
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Editorial in The Times
The Telegraph on the ultimate economic cost to Taxpayers of the Education Tax
