Chloe Dobbs is a student reading Philosophy, Politics and Economics at the University of Oxford.
Sir Keir Starmer has pledged to remove the charitable status of private schools, which would require VAT to be added to fees.
This move – that he hopes will raise £1.7 billion for state schools – will only make access to quality education more exclusive. In fact, it will likely cost the government money in the long-term, as pupil displacement brings more into the state sector.
But there is another way. I should know: after a gruelling experience at a poorly-performing comprehensive, I was awarded an 80 per cent bursary to attend an outstanding independent sixth form.
Taxing private schools will most likely reduce the amount of money they can devote to bursaries; Starmer’s plans thus threaten the ability of private schools to give more students the opportunity that I was given.
Bursaries are crucial to increasing social mobility in the education system. Fee assistance at schools affiliated to the Independent Schools Council (ISC) totals nearly £1.2 billion a year; if £1.7 billion is taken out of independent schools, there may be little left to help underprivileged students.
If the tax burden is absorbed significantly by schools (rather than passed entirely onto parents), we could see a huge reduction in fee assistance; if it is passed on in fee rises, existing assistance will go less far.
Moreover, removing the charitable status of independent schools would reduce their incentive to fund places for children without wealthy parents: at present, schools must earn their charitable status by giving out bursaries.
Without these bursaries, aspiration and social mobility will suffer; the ISC rightly calls Starmer’s policy “a tax on aspiration”.
A better solution to educational inequality would be an expansion of the independent school bursary system. Rather than removing the charitable status of private schools, the Charity Commission could implement more stringent conditions for private schools to retain it.
Winchester College, for example, has a rowing club, a rifle club, and an art collection. It would be reasonable for the Charity Commission to request they spend more money on bursaries, and less on superfluous pieces of art – or at least make these resources available to pupils in neighbouring schools.
To make matters worse, Starmer’s proposals would price a lot of families out of private schools. Not all current pupils are the children of millionaires: there are plenty of parents out there on a modest salary, counting their pennies to scrape together the funds for their child’s education.
At present, the Government does not pay for the education of the seven per cent of British students that are privately educated (whilst still collecting full taxes from their parents).
Fees are already increasing due to inflation alone: adding VAT on top could, it is estimated, push 90,000 children into the state sector, creating a significant new cost for the Treasury. A review commissioned by the ISC suggested that adding VAT to school fees would, in the policy’s fifth year, cost the Government at least £416 million after taking pupil displacement into account.
Starmer’s estimates don’t seem to consider the cost of students moving into the state sector, and hence his policy will likely cost the country both financially, and in terms of social mobility.
If you look away from grand public schools such as Eton and Winchester, you realise that there are also many small private schools that genuinely struggle to make ends meet, and which lack the economies of scale and high fees of bigger, prestigious schools.
Julie Robinson, chief executive of the ISC, stated in response to Labour’s policy that “most independent schools have fewer than 400 pupils on roll, and these small schools, serving their local communities, would be at risk of closure.”
Whole schools closing down would lead to a huge, untenable surge in demand for surrounding state schools – schools already grappling with significantly-stretched resources at a time when there is no slack in the public finances.
Starmer’s belief that taxing private schools will help improve funding for state school pupils seems, therefore, to be rather misguided.
In addition to the Charity Commission forcing schools to make more bursaries available, a solution to educational inequality could also include a government coupon scheme.
For the 2023-24 year, per-pupil state funding for 5-16 year olds will be £7,460. The Government could improve choice by offering a coupon towards independent school fees – of anywhere between a few thousand and seven thousand pounds – to children who want to attend private school but whose parents cannot afford it otherwise.
This, in the spirit of the Assisted Places Scheme previously delivered by the Tories and scrapped by New Labour, would make private education a lot more inclusive than all Starmer’s taxes ever could.
In recent years, the privately educated have become more and more demonised. Private school alumni fear being at a significant disadvantage when applying for their dream universities and jobs, just because their parents sent them to a good school; I fear being villainised for going to the private sixth form for which I worked so hard to get that 80 per cent bursary.
Starmer’s proposal is another unfair attack on such pupils; parents will soon fear sending their children to a good school if attacks like this continue, and the cost of that would fall on the taxpayer.
State schools certainly need more help. But taxing private schools is not the way to do it. Given Starmer seems likely to be be our next Prime Minister, it is crucial that the overwhelming case against his education policy is made and made well – before it’s too late.