In response to media reports that the Treasury might be considering imposing VAT on school fees in the upcoming Budget on 29.10.18, Mike Buchanan, Executive Director of HMC and former Head of Ashford School, said:
“We understand putting VAT on school fees might initially look attractive. However, it would be a policy based on dodgy maths and wrong assumptions.
“Far from raising money, it would cost the Government billions of pounds. That’s because many independent schools are not for profit and run on very tight margins. They would have no choice but to pass on new costs, meaning that many of those parents who can just about manage fees now, will no longer be able to afford them. Many schools will close.
“A common sense estimate is that up to 100,000 pupils could quickly move in to state schools, at a cost of approximately £6,000 per child, every year. That’s before adding in the price of new schools and facilities which could cost billions at a time when state schools are struggling to cope with lack of funds and dilapidated buildings.
“Most independent schools are integral to their communities and significant local employers, providing huge economic benefits. All this would be at risk if they are diminished or closed. Schools would have little choice but to stop spending over a million pounds a day on free and reduced places and community activities such as teaching, arts, sports and help with university applications would also have to cease.
“We would see class sizes going up in local state schools, a loss of essential community resources, loss of employment, and a huge cost to the Treasury at a time of a funding crisis in many state schools. Rather than the rich paying more, the less well-off would end up suffering the most.
We remain hopeful that our excellent cooperation with DfE under the Joint Understanding would mean that such a move would be recognised as foolhardy. It is much more helpful to pupils for us to work together.”