As we know only too well, independent education is a soft target for the media and political discourse. The Independent Schools Council (ISC) is well-versed in briefing and re-briefing politicians and civil servants to inform them of the consequences of proposed policies on independent schools.
We take a close interest in these potential effects beyond our sector because independent schools have broader relevance to education and have an impact felt widely across society and the UK economy. The ISC spoke directly to politicians and shadow cabinet members at this year’s Labour Party Conference, where they reintroduced a policy of punitive tax proposals. We know from positive meetings with Labour MPs that some understand the active and helpful role independent schools play within their communities and we need to build on this.
“We know that some Labour MPs understand the helpful role independent schools play.”
One thing schools could very helpfully do is make the case locally to their own MPs about the beneficial contributions of the school communities to the wider sector. There is plenty of helpful material on the ISC website, which can of help when trying to quantify the benefit they deliver, including a tool schools can use to calculate their individual economic contribution.
Economic analysts from Oxford Economics, specialists in global forecasting and quantitative analysis, found in their report, The Impact of Independent Schools on the UK Economy, 2018, that independent schools save the taxpayer £3.5 billion every year by educating pupils who could otherwise be expected to take up a place in the state-funded sector. In addition, those schools in membership of the ISC’s constituent associations contribute £11.6 billion to the UK economy annually, generate £3.5 billion of annual tax revenue (equivalent to £129 per UK household) and support 257,000 jobs.
Of the £11.6 billion ISC schools contribute to the economy, non-British pupils at ISC schools support around £1.8 billion of gross value added in the UK, supporting 39,310 jobs and generating £550 million in annual tax revenues.
“Independent schools support economic growth by promoting subjects that are important for the UK’s skills base”
Independent schools also contribute £1bn annually to education exports. The strong global reputation of British education attracts overseas companies and international students to the UK. These students bring a global perspective to our schools, enrich the community, and are a vital pipeline to British universities. Independent schools are proud of the role they are playing in meeting the ambitions of the Government’s International Education Strategy and the target of attracting 600,000 international students to the UK every year.
Not only do international students choose UK independent schools but, having been immersed in British life, many choose to remain and study at UK universities. Independent schools also support economic growth by promoting subjects that are strategically important for the UK’s skills base, as well as boosting global competitiveness. Advanced maths and science study is key for technological innovation and countering climate change.
As global influence shifts, modern foreign languages will be vital for trade and international co-operation. In the last year that exams were taken (2019), independent schools accounted for almost 30 per cent of entries for A-levels in French and Spanish, 30 per cent of further maths A-level entries and 21 per cent of physics A-level entries.
“Educational partnerships between independent and state schools are an important aspect of school life.”
Of course, this debate is about much more than just numbers. Working in schools represents a commitment to helping children and young people thrive, and this is the most important contribution schools make to society. Independent schools provide valuable capacity and specialism across the UK’s education network. By widening access and through partnerships with state schools, they increasingly create educational opportunities for greater numbers of young people from a variety of backgrounds, benefitting both their local communities and the overall education system. Educational partnerships between independent and state schools are an important aspect of school life.
In January 2020, before Covid restricted activities, ISC schools were involved in 11,700 partnership projects including:
- subject support in maths, science and modern foreign languages
- teacher training
- careers and higher education advice and support.
Larger independent schools have forged partnerships through the sponsorship and co-sponsorship of schools as part of the Government’s academies and free schools programme. Schools such as the London Academies of Excellence in Tottenham and Stratford rely on independent school sponsorship and achieve high rates of Oxbridge entry.
The sector’s commitment to independent-state school partnerships is set out in a Joint Understanding (JU) with the Department for Education. In addition to encouraging impactful partnership work, the JU emphasises independent schools’ desire to widen access through bursary provision
“Last year alone, ISC schools provided £455m in means-tested bursaries and scholarships.”
Schools recognise the benefits bursaries bring to both pupils in receipt of fee assistance and the wider school community. Last year alone, ISC schools provided £455 million in means-tested bursaries and scholarships. The sector has also proposed a scheme to enable up to 10,000 children from low-income families to attend independent schools every year. If this offer were taken up, it could benefit hundreds of thousands of children over time.
Having touched upon some of the most valuable contributions the independent schools sector makes to the economy and to society (you and your school will no doubt have your own good examples), we should consider the potential damage punitive financial measures such as those set out by the Labour Party would do.
Labour has identified an opportunity to secure £100 million from ending business rate relief for charitable schools and a further £1.6 billion by removing the “exemption on VAT” – which is understood to mean charging 20 per cent VAT on school fees.
Schools should note that the laws governing VAT on the provision of education services are separate to charity law, and VAT on fees would affect schools that are owned and operated by charities and those that are not. School fees are currently exempt from VAT under the VAT Act 1994, which considers education to be in the public interest – with the exemption also covering higher and further education bodies.
“There is a clear contradiction in a policy that aims to raise revenue from independent schools and reduce demand for them at the same time.”
Now, attacking independent schools does not improve our education system. Removing charitable status and putting VAT on school fees would penalise parents and would make independent school education unaffordable for many families, forcing the closure of smaller schools and resulting in more pupils needing state school places, swelling class sizes and piling pressure on already-stretched budgets.
We know from research (see the Baines Cutler VAT on School Fees report on the ISC website) that adding VAT on school fees would cost any government at least £416m in its fifth year and will not provide the money to support spending pledges. This is because schools would be eligible to reclaim VAT expenses once it was charged on fees, while it is estimated almost 135,000 pupils would move to the state sector as fees went beyond parental affordability.
There is a clear contradiction in a policy that aims to raise revenue from independent schools and reduce demand for them at the same time. We all want to see more funding for state schools and greater support for underperforming pupils, which is precisely why we encourage schools of all types to work together in partnership to benefit all pupils.
The focus should be on working collaboratively to carry out more of this life-changing work. Working closely with the member associations, the ISC will continue to promote and protect the sector on your behalf. Should you ever wish to contact us about any aspect of our work, please do so viaisc.co.uk/contact-us/.
This article originally appeared in the latest print edition of School Management Plus magazine, out now.