(4 days, 9 hours ago)
Lords ChamberThat this House takes note of the impact of VAT and other tax changes on independent schools since 1 January 2025.
My Lords, in the autumn of 2024, when I was in better health, I introduced two debates on the imposition of VAT on independent school fees, due to come into effect on 1 January 2025. Most speakers in those debates referred to the grave difficulties independent schools and the families of their pupils would face as a result of Labour’s education tax—the first to be introduced in Britain and, apart from a disastrous experiment in Greece, the first in Europe. The Government added further to the costs of independent schools last year and, in the process, helped jack up their fees—after five years during which fee rises had been lower than wage inflation—by scrapping the exemption from business rates that most of them enjoyed by virtue of being charities. Just like the VAT exemption, both were scurrilously misrepresented by Labour as tax breaks.
Independent schools were hit again by the increase in employers’ national insurance contributions. State schools received additional public funding to off-set the higher NIC bill; independent schools did not. The object of today’s debate is to consider how independent schools, of which there are some 2,500 in total, are faring in the face of Labour’s unprecedented financial assault upon them.
I declare my interest as a former general secretary of the Independent Schools Council and the current president of the Independent Schools Association, one of the ISC’s constituent bodies. The ISC represents some 1,400 schools, in which around 80% of the pupils in the independent sector are educated. The Independent Schools Association has some 700 schools, a large slice of the total, in its membership. As I have stressed on previous occasions, it is among these 700 schools that many of the small schools, so prevalent in the independent sector today and so valued by their local communities, are to be found. Large, well-known schools that fascinate the public and the media are the exception, not the rule.
Article after article and survey after survey have provided evidence of the strain that the Government’s education tax is placing on hard-working families. The latest survey by Parentkind found that 40% of parents with children in independent schools have been forced to cut back on household spending to meet the cost of their children’s education. These are the people who work extra hours, forgo holidays and put off replacing the family car because they believe an independent school is right for their child. The education tax increases the sacrifices that they have to make.
The independent sector’s contribution extends far beyond this country. Independent schools are a major export success story and an important source of British soft power, helping attract talented young people to the United Kingdom and enhance Britain’s reputation overseas. This is something the Government should be championing, not chipping away at. Together, independent schools generate more than £3 billion annually through education, exports and transnational education, despite intense international competition.
At home, independent schools stand ready to use their expertise to help raise standards and deliver national education priorities. One clear opportunity is for them to work with state schools in meeting the Government’s new enrichment benchmarks. These expect pupils to have access to civic engagement, arts and culture, outdoor adventure, life and future skills, and sport and physical activity, but the Government have confirmed that no dedicated funding will be provided to schools to deliver this ambition. Independent/state school partnerships already make a major contribution in these areas.
In the past year, more than 1,000 ISC schools have worked with state school colleagues in nearly 10,000 partnership projects across sport, music, the arts and academic collaboration. These range from sharing facilities and running joint lessons and events to seconding staff and helping state school sixth-formers with university applications. All represent invaluable opportunities for children at no cost to the state. Sadly, the Government have shown remarkably little interest in supporting and strengthening this work, even as they place greater expectations on schools to broaden pupils’ opportunities.
The Government claim that falling pupil numbers in England’s independent schools reflect the wider decline in the school-age population. The figures do not bear this out. Pupil losses in independent schools have been more than triple the decline in the school population as a whole. The Government also trot out the line that more independent schools have opened than closed since the introduction of the education tax. This disguises the importance of the loss of mainstream independent schools, many of them centuries-old centres of academic excellence. Mainstream schools account for 82% of the 106 school closures so far under the impact of the education tax.
The schools that have opened, though numerically larger, are for the most part very different. The independent sector now has many more special schools, catering for children with acute and complex special needs, which account for some 90% of the newcomers. The growth of specialist provision is both welcome and necessary at a time of rising demand for SEND support, but the Government failed to acknowledge the change in the character of the independent sector that this trend represents. Many places in special schools are commissioned and funded by local authorities. Where an independent school is named in the child’s education, health and care plan, the local authority can also reclaim the VAT.
The Government may argue that closures are in line with long-established trends, but the average capacity of the schools that have closed since the introduction of the education tax has been almost double that of schools which closed in the preceding 10 years. The casualties of the Government’s education tax include Malvern St James in Worcestershire, which closed after 133 years. Durham High School closed after 142 years, Ruthin School in Denbighshire closed after 742 years and Thetford Grammar School in Norfolk closed after nearly 1,400 years.
Labour have been in government for little more than two years, yet the damage they have done is considerable. Every school closure means lost jobs, disrupted local supply chains and children losing a community that may have impacted their lives for years. The effects are often particularly severe in rural areas. Reports on closures refer to distraught teachers, anxiety among parents forced to find a new school at short notice and children having to move midway through their A-levels.
Mr Campbell Harrison, head of St Gerard’s School in Bangor, which closed in July after more than 100 years, told me:
“VAT, the loss of business-rate relief and higher national insurance pushed us over the edge. More than 30 members of staff lost their jobs, with some unable to make mortgage payments and few comparable posts available locally. We gave families as much notice as we could so that the children had a chance to find places before September. Some families have struggled to find suitable places, while some children now need to travel an hour and a half each way to get to school—an exhausting three-hour daily commute for a child. In an area where employment is already scarce, the closure has taken more than £1 million a year out of the local economy”.
That is what Labour’s education tax means in practice.
Ministers have called the VAT exemption a subsidy, but of course the truth is the reverse. Independent school parents subsidise the state by educating their children at no cost to the taxpayer. Every child who moves into the state sector will cost the taxpayer more than £8,500 a year. The more children are forced by the education tax to leave independent schools, the higher the cost will be, and the proceeds of the tax will drop dramatically.
The evidence from Scotland is stark. The introduction of VAT there is already estimated to be costing more than it is raising. Analysis by BiGGAR Economics, commissioned by the Scottish Council of Independent Schools, estimates that VAT on independent school fees will cost the Scottish taxpayer some £16 million this year. Over time, the annual cost is projected to rise to a staggering £181 million.
Labour claimed that this policy would help fund the recruitment of 6,500 new teachers. Ministers may well try to shift the manifesto goalposts to suit their current communication strategy, but the stark reality is that the number of full-time equivalent teachers in state schools has fallen by 2,322 since 2023-24. With teacher numbers down, where is the money going? The former Prime Minister, Sir Keir Starmer, even suggested that the education tax had enabled the Government to make
“the largest investment in … affordable housing in a generation”.
Labour may dislike independent schools, but the public take a different view. Opinion polls show that more than half of respondents believe that independent schools have a positive impact nationally and in their local communities, with fewer than one in 10 believing that the impact is negative. Independent schools are part of our cultural heritage, a source of educational excellence, a great British success story and a powerful instrument of soft power around the world. The Government should recognise that they are a national asset worth protecting.
The sad truth is that the Government will not admit that this policy was never driven by economics. It was driven by ideology—by the old prejudice that independent schools are an enemy to be overcome rather than a national asset to be supported. They are taxing families to the hilt, placing an impossible burden on some of our finest institutions and adding pressure to a state system which is already at capacity at secondary level. The stark consequences are now before us.
In assessing the effects of their education tax, the Government continue to rely on HMRC’s tax information and impact note, which was drawn up almost two years ago—before the policy took effect. It must be reviewed. The Government may point to the Office for Budget Responsibility’s slightly higher revenue forecast in 2025, but that revision largely reflected schools having to pass on more of the tax than the Government originally expected. It does not take account of the subsequent fall in pupil numbers, further school closures or the additional costs falling on the state sector. A review is essential. There is also a need for a clear and robust methodology for estimating the revenue raised by VAT on independent school fees in each tax year.
Last weekend, the Secretary of State said:
“My interest is in the 93 per cent of kids who are educated in the state sector”.
Does she have no interest in the more than half a million children educated outside of it, and in their families? Does she have no interest in the hundreds of teachers who have lost their jobs, or the countless supply chains that have been affected? Does she have no interest in the wider economic consequences of this policy, or the damage to our international education exports? She should begin to show some interest, because surely every child and every school matters. I beg to move.
My Lords, as is customary, I thank all speakers. The contributions today have been, I think, for the most part, especially powerful, with many rooted in personal experience. We have had almost total unanimity of voice about the devastating impact on independent schools of the education tax. It was notable that, as my noble friend Lord Caine, pointed out, not a single voice was heard from the Labour Benches in defence of this policy.
A range of important topics have been covered: bursaries; the impact on local economies; partnerships; the impact on state schools; loss of opportunity; the vindictiveness of introducing VAT mid-year; the closure of historic institutions; music education and the threat to specialist music schools; special needs; the impact on boarding schools; and the doubts around the economics on which this policy is based—that really is the central issue that has been brought out. There is a widespread belief that at the heart of this is not economics but a vindictiveness towards independent schools.
The Minister is so confident in her policy and the figures and data that she has used that she will surely have no reluctance in putting the issue to the test by establishing the independent inquiry review for which so many speakers have so rightly called. I end by thanking all those who have contributed. I beg to move.
(6 years, 2 months ago)
Lords ChamberMy Lords, our record shows that we are taking a leading role in this. The Prime Minister has consistently called on world leaders to work together to rapidly develop a vaccine and make it available to all, including at the Coronavirus Global Response pledging conference, which the UK co-led, and at the recent Global Citizen summit. The UK also hosted the Gavi summit, which raised over £6.9 billion for Gavi to sustain its immunisation coverage and bolster the primary healthcare systems needed to tackle Covid-19. We will continue to play this leading international role.
My Lords, all supplementary questions have been asked and we now move to the next Question.
(6 years, 7 months ago)
Lords ChamberTo ask Her Majesty’s Government when they expect the review of Operation Midland by Her Majesty’s Chief Inspector of Constabulary to be completed.
My Lords, HMICFRS is not reviewing Operation Midland. On 3 October last year, the Home Secretary directed Her Majesty’s Inspectorate of Constabulary and Fire & Rescue Services to undertake an inspection to determine the extent to which the Metropolitan Police service had learned the lessons of Operation Midland. Fieldwork has now been completed and the report is expected to be finalised and published by the end of March.
Is it not shocking that not a single police officer has been called to account for the catalogue of errors laid bare in Sir Richard Henriques’s report on Operation Midland, while some of those involved have been promoted to high rank? Why do the Government persist in rejecting the Wiltshire police and crime commissioner’s calls for an inquiry into Operation Conifer, the botched investigation of allegations against Sir Edward Heath—largely financed by the Home Office—whose shortcomings so closely resemble those of Operation Midland?
My Lords, Operation Conifer has been scrutinised and it followed absolutely the procedures it would have been required to undertake. Its outcome, while not satisfactory at all to some of Sir Edward Heath’s friends and family, has certainly been fully and rigorously tested.
(6 years, 10 months ago)
Lords ChamberMy Lords, it appears that on the issue of equality, we are snatching defeat from the jaws of victory. Like other noble Lords who have spoken, I do not want to hold back these regulations, because they are not just a step but a huge leap forward for opposite-sex couples’ equality. However, I despair a little that the Government have not been able at this point to bring about true equality.
I wear this lanyard, as others do, not because I am proud to be LGBT or an LGBT ally, but because I believe in fundamental equality before the law and in human rights. I have spoken in this House before about not being able to marry in a religious institution, which is a form of discrimination. I would not want somebody who is part of an opposite-sex couple to feel that sense of joy being deflated by not being able to convert their civil partnership into a marriage. There is no legal reason why that cannot happen but just a bureaucratic one, based on “some consultation is taking place”.
I know the Minister and her personal passion for equality, which is beyond doubt. However, she kept saying “short term”. How short is short term? The one thing she cannot give is any certainty. We are going into a general election, so short term may be longer than the noble Baroness feels. In addition, it may be short term to the Government, but for somebody who is in an opposite-sex civil partnership and wants to convert, it may take much longer than the short term, particularly if that person has a terminal illness. People make decisions because of life-changing events, so we may be denying somebody the equality that they want based on where they are in their life.
I therefore ask the Minister and the whole House, to ensure that, whoever is returned after the general election, short term must mean a matter of weeks or months. This cannot go on for years because of some bureaucratic government view about consultation.
My Lords, I have listened to important comments from the noble Lords, Lord Collins, Lord Cashman and Lord Scriven, with whom I agree so much on matters relating to civil partnerships and same-sex marriage. However, I would like to return briefly to a deep injustice which the extension of civil partnerships to opposite-sex couples has made even more glaring.
Civil partnerships were introduced for the express purpose of conferring legal rights on couples who were ineligible to marry. Through these regulations, civil partnerships will be extended to all couples who now possess the right to marry. They will be withheld from people who cannot marry—in defiance of the very principle on which they were established in the first place.
I have brought up on a number of occasions in this House the question of why the Government feel it is acceptable to continue to withhold from long-term cohabiting siblings who choose to live together for companionship and mutual support all the legal rights and fiscal safeguards they offer, through civil partnerships, to couples they presume to be in sexual relationships.
Do the Government think that two siblings who live together in mutually supportive and financially independent relationships are less in need of the legal protection and fiscal safeguards afforded by civil partnerships than sexual couples? If not, why do they continue to reject both the argument that they should extend civil partnerships to long-term cohabiting couples and the suggestion that they should address that discrimination through other means—for a start, by reforming the rules governing inheritance tax so that bereaved survivors of a sibling couple are at least spared losing the joint home to inheritance tax on the death of the first sibling? I am in touch with a large number of elderly siblings who have lived together, often all their lives, in committed and caring relationships. They simply cannot understand why the Government refuse to recognise them as a single legal unit or give them any help whatever by other means.
Take Beatrice and Mary, sisters whose mother was widowed in their teens and whom they looked after throughout their adult lives in their jointly owned home until her death at the age of 100. The sisters are now 91 and 87. When one of them dies, the survivor will face an inheritance tax bill so hefty on her sister’s share of the estate that there will be nothing left of their joint savings for her own care. If they were civil partners who had known each other for just a few weeks, they would be spared.
A responsible Conservative Government must recognise the value of arrangements such as that of Beatrice and Mary, bring an end to this injustice and finally put the family, in all its manifestations, back where it belongs: at the heart of Conservative social policy. The regulations advance the principle of equality in human affairs—although perhaps not as fully as many would wish—and that is very important, but Conservatives should be no less concerned with the welfare of families in all their forms.
My Lords, I am very pleased that, on the last day of this Session, we are returning to this business. Like other noble Lords including the noble Lords, Lord Cashman and Lord Collins, I thank the noble Baroness, Lady Hodgson of Abinger, for all the work she did to get us to this point.
I have been a Member of your Lordships’ House for so long that I can remember all the rather tortuous path that we have been down, from when we started off, back in 2004, with a Civil Partnership Bill that was wrecked in this House and very nearly fell, but was then rescued and came back, through to where we are today. It is a tortuous path for two reasons. One is that, at every step of the way, the Government have felt that they have to pick their way round strong religious sensitivities. The second is that there is a fundamental flaw in all the reasoning as a result. We were told, way back when we were looking at civil partnerships, in definite terms by evangelical Christians and all the rest, that civil partnerships would undermine marriage. They do not.
In this House, from listening to officials at the time, I understand that at every stage we had to give in to the idea that civil partnerships were somehow a threat. I have never thought that they were for a very simple reason. My father married a lot of people. On Saturday afternoons, my dad would go out, perform a wedding, come back and we would say, “And what was the bride wearing?” Dad would say, “A white dress”. Because my dad was a nonconformist minister long before the Church of England saw the light on matters such as divorce, he was marrying a lot of people. He always had the right not to agree to marry someone. It was a right that he exercised very rarely—only in one or two instances when people came before him and he believed that one of them was under duress to do something that they did not want to. However, he quietly confided that he often officiated at marriage ceremonies where he felt that the people were getting married because that was all there was, and that if there had been an opportunity for them to have their relationship recognised in a different way, that would have been a more honest thing to do. If the Church had recognised that a long time ago, we would not have had to go through much of the difficulty that we now do.
Many people have shouted out their congratulations; mine go to Lynne Featherstone—my noble friend Lady Featherstone. No matter what anybody says, we would not have same-sex marriage were it not for her determination. For these regulations, I also want to give a shout-out to somebody else: Peter Tatchell. As one would expect, he has always single-mindedly stood up for full equality. Therefore, he has always been in favour of opposite-sex civil partnerships. So, we have got to where we are today. The noble Lord, Lord Collins, is right: the Government know that we on this side of the House do not want to stop the regulations. We are keen for people who have waited for such a long time to have their opportunity.
I want to ask about the territorial extent of this issue. I see that we are legislating for England and Wales. Speaking as a Scot, I feel that it might have other things to do on Hogmanay, but perhaps the Minister can explain the likely timetable for the Scottish Parliament to consider this matter.
I also want to talk about Northern Ireland. It is important that we get legislation of this type in Northern Ireland as quickly as possible, for the reason alluded to by the noble Lord, Lord Collins. I know several people in committed relationships who have been brought up in a faith that means so much to them that they cannot bring themselves to offend their families and that faith, but want to secure their relationship in legal terms. For others, civil partnership is about equality; as the noble Baroness, Lady Watkins of Tavistock, said, other people have experienced difficult and violent marriages and want never to return to that situation, but are in partnerships to which they are committed. What is the envisaged timetable for introducing this in Northern Ireland?
My understanding of this legislation is that, just as happened with the abortion legislation for Northern Ireland, there will be a read-across from existing legislation. Therefore, I think I am right that the aspects of the regulations that deal with the GRA are a read-across from the GRA as it relates to same-sex marriage. The Minister will know that I and other people think that that legislation is flawed, and that the same flaw therefore appears in these regulations. I accept that this issue should be addressed through primary legislation and amendment to the same-sex marriage Act in so far as it affects the GRA but, when the time comes, this issue should be addressed for both same-sex marriage and opposite-sex civil partnership, for example through my Private Member’s Bill or perhaps through some forthcoming government legislation. I wish that she would understand that.
(6 years, 11 months ago)
Lords ChamberThe noble Lord points to the need for an institutional overview in the body of the HMICFRS to look into this. Clearly, the Government will look into its findings. We received the IOPC report this morning and will be looking at it with great interest. He is right that the warrants are the most contentious issue in the Henriques report. Was the district judge misled into signing off warrants to search the homes of Lord Brittan, Lord Bramall and Harvey Proctor? He is clear that the IPCC—now the IOPC—should investigate this issue.
In view of the immense public concern created by Operation Midland, with the delay in producing the full report, the further report published today, is it not important that the chief inspector’s work proceeds thoroughly but as swiftly as possible? Should he not extend his inquiry to include grave police misconduct during Operation Conifer, when some of the evil fabrications of Carl Beech seemed to have helped besmirch the reputation of Sir Edward Heath? Have the Government noted the resolution I tabled for debate last December, calling on them to establish an independent inquiry? I have been denied a debate, but I have no doubt that the House would have supported the resolution overwhelmingly. Let the inspector of constabulary examine Operation Conifer.
To answer my noble friend’s question, Operation Conifer has been subject to considerable external scrutiny and although Carl Beech was one of those who made allegations against Sir Edward, Wiltshire police has made it clear that they were discounted by Operation Conifer. Beech’s conviction is not therefore relevant to the seven unresolved allegations from the investigation and the Government do not consider that there are grounds to intervene. On my noble friend’s point about swift action, I know that the HMICFRS is keen to proceed swiftly.
(7 years, 2 months ago)
Lords ChamberPerhaps it would be helpful if I went over what I said yesterday. The College of Policing’s authorised professional practice guidance on relationships with the media makes it clear that suspects’ names should be released to the media prior to charge only in exceptional circumstances if there is a legitimate policing purpose to doing so—for example, where there is a threat to the public or for the prevention and detection of crime. This approach recognises that there is a risk of unfair damage to the reputations of those arrested, particularly if they are never charged. The noble Lord asks whether we support this approach. Yes, we do; as I said to the noble Lord, Lord Campbell-Savours, we have every evidence that the police are sticking to that guidance.
Does the new guidance mean that never again will a police officer pronounce, having talked to a complainant, that his evidence was credible and true?
The issue of Operation Conifer allowed the police to look at the guidance and make sure that it is as clear as it can be. As I said, there is no evidence that the police are flouting that guidance. I hope that that situation will continue.
(7 years, 2 months ago)
Lords ChamberTo ask Her Majesty’s Government what assessment they have made of the petition calling for anonymity for those accused of sexual offences until charged.
My Lords, the Government believe that there should in general be a right to anonymity before the point of charge in respect of all offences, but there will be exceptional circumstances where there are legitimate policing reasons for naming a suspect.
My Lords, does not this petition bring home to us all the misery and distress endured not just by well-known figures but by scores of innocent men and women up and down our country, whose lives have been ruined because police officers decided that allegations of child sex abuse should always be believed and divulged their names before charges were laid? In one notorious case, the police went further. Who can forget the truly shocking spectacle of a senior police officer standing outside Sir Edward Heath’s house in Salisbury and appealing for evidence through which his reputation could be destroyed? It is an injustice which continues to cry out for the independent inquiry which the Government have shamefully denied him, in defiance of the wishes of this House. Surely action should now be considered in response to the petition to strengthen protection for that precious fundamental right: the presumption of innocence.
My noble friend will know that once a petition reaches 10,000 signatures, the Government can consider it for debate—I know I do not need to tell him that. He will also know that the release of suspects’ names by the police is governed by the College of Policing’s guidance on relationships with the media. Although I absolutely recognise the points made by my noble friend about some high-profile cases, we are not aware of any recent evidence to suggest that the police are not adhering to the guidance.
(7 years, 2 months ago)
Lords ChamberSo we are both right: that is good; I was convinced it was about the same age as me—49, obviously. The noble Baroness is absolutely right. I am proud that this is such a tolerant country, a country so committed to equality. You will not find a finer example of tolerance and equality around the world than the UK.
My Lords, do the courts need any stronger powers in punishing homophobic crimes?
The Law Commission has been commissioned to look into hate crime and whether there are any gaps in the law. The noble Lord, Lord Cashman, touched on this when he spoke about equality across sentencing. The Law Commission is due to report to us next year.
(7 years, 3 months ago)
Lords ChamberMy Lords, it is important to consider that, for all people claiming asylum, if that claim is not granted, they are sent back to their country of origin. I understand the vulnerabilities of LGBT people in some countries. For that reason, we provide support in this country when people return to their country of origin. We give them various types of support, including long-term accommodation, legal and medical support, and family tracing, which is incredibly important for someone returning to their own country.
Have the Government not committed to publishing annual data on the number of asylum claims based on sexual orientation? If they have, when will annual publication begin?
The Government collate data of asylum claims based on sexual orientation. I understand that almost 6,000 asylum applications lodged between 2015 and 2017 stated sexual orientation as the basis of their claim, although my noble friend will be aware that sexual orientation might not be the first basis for a claim.
(7 years, 5 months ago)
Lords ChamberIt is important to have a wide range of entry routes for people who wish to join the police, which all conform to very high standards. I cannot comment on the cost that the noble Lord outlined, but it is really important that people should not have to have a degree to enter the police. There is no requirement for that, but the standard is set for degree-level qualification at the end of the training process.
My Lords, will these reforms mean that, in future, only men and women of the very highest ability are appointed to the post of chief constable, unlike Mr Mike Veale, whose disastrous Operation Conifer has inflicted such dreadful and unfair damage on Sir Edward Heath?
I have to admire my noble friend for managing to weave in something that is so important to him. To make a very serious point, the whole aim of this is to have the highest standards of policing in our forces.