Independent Faith Schools: VAT
Debate between Ashley Fox and Olivia Bailey(3 days, 6 hours ago)
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Olivia Bailey
The hon. Gentleman made his case well in his speech earlier, and he makes it again now. The Government have carefully considered the options that he has put forward today. I have heard all of his points and they have been noted by my officials.
Private schools have steadily increased average fees by 75% in real terms since 2000, and that has not affected pupil numbers. Fee increases can also reflect wider cost pressures beyond VAT and business rates.
The Government are closely monitoring the impact of VAT policy on the private school sector. We remain confident in the estimates made when this policy was introduced, which said that the number of private school closures was expected to remain relatively low and influenced by various factors, not just by the VAT policy. On average, 74 private schools, including independent special schools, have closed per year over the past 20 years. However, only 60 private schools closed in academic year 2024-25, which is the school year that the VAT changes were introduced. That means that school closures announced thus far remain firmly within historical patterns and sit comfortably within our expectations. Indeed, even after the VAT policy came into effect, private schools continued to open in England. In the same time period—between 1 September 2024 and 31 August 2025—106 private schools registered and opened.
We are confident that the state sector can accommodate any additional pupils, including any pupils transferring from private state schools.
Sir Ashley Fox
The justification for this tax given in the Labour party manifesto was to raise revenue to employ more teachers in the state sector, yet we now know that in November 2025, there were 1,400 fewer teachers than 12 months previously. Can the Minister tell us where the money has gone?
Olivia Bailey
I will. I am just coming on to that, if you will bear with me. I am grateful for that. [Interruption.] Did I do something wrong, Sir Alec? I apologise.