The average cost of private schools in the UK has increased by up to 9 per cent this year, figures show.
Families now pay more than £6,000 a term, on average, according to figures released by the Independent Schools Council.
Its annual census shows average fees for private day schools rose by 8 per cent for the 2023-2024 academic year compared with the previous year.
There were even steeper rises for boarding fees, which now sit at more than £14,000 a term, 9 per cent higher, while day fees for boarding schools increased by 8.8 per cent to almost £8,000 a term.
Julie Robinson, chief executive of the Independent Schools Council, a lobby group for private schools, told The National that schools set the fees last April, during a period of unusually high inflation, alongside a cost-of-living crisis, rising energy prices and the continued economic fallout from Brexit and the Covid-19 pandemic.
“The fact that fee rises were under the rate of inflation at the time they were set is testament to schools’ work balancing this unprecedented squeeze on budgets with affordability for parents,” she said.
There are 1,411 ISC schools across the UK, and a growing number overseas, including 13 in the UAE, which accounts for the largest cluster of members overseas after China, where there are 53.
The ISC data showed the number of new pupils joining private schools in the UK has dropped by 2.7 per cent since last year, which is the biggest fall since the ISC started collecting in 2011.
A recent survey showed private schools are imposing an increase in fees of up to 8 per cent for the coming academic year starting this September, with a range from 3.8 per cent to 8 per cent, with an average rise of 5.5 per cent.
The steep rises come ahead of the expected addition of Labour’s promised 20 per cent VAT on fees, if the party wins the next election.
Labour has not said when it will introduce the charge, but experts have said it could potentially be announced within days of the party winning power, although it is likely that it would take “months” to be enacted into law.
John Rainsford, VAT director at Evelyn Partners, told The National that VAT will probably not only be added to education, but related provisions, too, such as boarding fees and school meals.
“Labour has committed to raise as much funds as it can through this intended proposal,” he said.
“I believe in order to maximise the VAT generated by private schools, they will look to treat the majority, if not all, supplies as being subject to VAT, including things like school dinners, boarding, school trips … because they are closely related to the supply of education.
“This will further increase costs for parents.”
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About a third of pupils at ISC schools receive some help with their fees, according to its report.
Around £1.4 billion was spent on providing fee assistance this year, which includes bursaries and scholarships, an increase of 10.2 per cent on last year.
Schools are bracing themselves for the impact of the VAT policy, which is widely expected to result in a reduction in rolls.
Gatehouse School in Hackney is planning for the removal of 10 per cent to 20 per cent of children.
“Most parents will hang on to the very last minute, so if anything it will be a mass exodus, not just for us, but for other schools, because parents don’t want their children to leave,” Sevda Korbay, the school’s head teacher told The National.
At the non-selective school, which charges significantly less than average, at under £5,000 a term, one third of its children have special needs.
VAT is a huge concern, said Ms Korbay, who worked for the state sector for nine years before she entered private education.
“If we lose 10 to 20 per cent of our children, some will relocate and some will have to go into the state sector, so the demand on the state sector will be far greater. It just doesn’t make sense.”
Tax experts have also called into question the viability of the introduction of VAT.
Mr Rainsford said Labour has predicted the policy will generate up to £1.5 billion in revenue.
“It is difficult to see how that will be achieved when parents will be forced to pull their kids out of fee-paying schools,” he said.
He said the most probable outcome is that parents who remove their children from independent schools will spend money on houses close to the best state schools or private tutors, in order to increase their children’s chances of obtaining a place in desirable schools.
“Education by private tutors will almost certainly remain exempt from VAT,” he said. “So they will spend it on things that won’t generate money for the government, like tutors and houses.”
