Non-Domestic Rating (Multipliers and Private Schools) Bill

Baroness Barran Excerpts

Committee stage
Thursday 27th February 2025 Grand Committee

[Lord Black of Brentwood (Con)]

My Lords, I will speak briefly to Amendment 54A and the consequential amendments in the name of my noble friend Lord Lexden, to which I have added my name. I declare my interests as chairman of governors at Brentwood School and as president of the Boarding Schools’ Association and the Institute of Boarding. I have just two brief points to add to the comprehensive remarks that my noble friend delivered with his customary eloquence, with which I agree entirely.

First, why do we need a definition in the Bill, given that the 1988 Act, as far as I can tell, does not use the term or make any reference to schools, and talks generically only of charities? If the concern is to make a differentiation between independent schools and academies as state-funded and independent schools, it would surely be much simpler to make clear that the Bill does not apply to academies. The only conclusion you can reach is the one that my noble friend reached: the novel insertion of this definition is simply to shoehorn what I am afraid is party-political dogma into this legislation, and that makes for bad law.

That leads me to my second point. At some point this legislation may well end up in the courts, when the legal definition of independent school, which has been long established in law, as my noble friend said, may become very important. Therefore, there needs to be certainty about definition, which there will not be if independent education is dealt with in different ways in different pieces of legislation. What steps have been taken to ensure that this definition is not compromised or contradicted in some way in other legislation, which will at some point down the line cause real legal uncertainty?

[Baroness Barran (Con)]

My Lords, as the Committee and the Minister know by now, we on these Benches are opposed to the whole of Clause 5, and I will start my remarks by making the case that it should not stand part of the Bill; rather, we urge the Government to think again and remove it.

First, as we debated at Second Reading, there is the point of principle. On what basis should the Government identify a single group of charities, with no concerns about the delivery of their charitable objects, for separate treatment in relation to business rates from their charitable peers? Sadly, the only plausible reason is that it reflects some ideology that does not respect the right of parents to choose the education for their child. I am not suggesting that the Minister sees it in that way, and I accept that the Government’s plan to tax education for the first time ever in this country’s history were in their manifesto, but I cannot find another logical basis for this choice.

Secondly, this picture is confirmed when we look at the amount of money that will be raised from this change. The Government project that only £70 million will be raised. Finally, it leaves the risk that in future legislation in this area, this or a future Government will carve out another group of charities that they believe no longer justify the business rates relief. This feels a wrong-headed choice, and I very much hope that the Minister will encourage his colleagues to review it and remove the clause.

I turn to Amendments 55, 56, 59 and 62. Amendment 55 is consequential and necessary to enable the later amendments. I have tabled it to exempt specific independent schools from this measure. Amendments 56 and 59 are probing amendments to understand what is meant by the term “or other consideration” in the context of fees payable for the provision of full-time education. I would be grateful if the Minister could give the Committee an example of where another consideration has been used in practice wholly or partly to replace fees.

Amendment 62 highlights the position of smaller independent schools, many of which charge significantly less than the independent school average of £27,642, which was the figure the Minister in the other place gave as the mean annual day fee as of January 2024. I appreciate that the Government are unlikely to agree with the fee level in my amendment, but it would be helpful for the Committee to hear whether there is a fee level below which this legislation would not apply. As the Minister knows, some faith schools in particular charge lower fees than the state school equivalent per pupil funding rate. Would the Government consider exempting schools that charge less than the per pupil funding rate from this tax.

As we have heard, Amendments 54A, 55A, 59A, 69C, 69D, 77 and 78 in the names of my noble friends Lord Lexden and Lord Black of Brentwood would replace the use of “private school” with “independent school”. I agree with my noble friends’ analysis of the importance of this and some of the factors that sit behind it. The term “private school” is much more informal, and in legislation it is more commonplace to use “independent school”. We support those amendments fully; I hope the Minister will give careful consideration to them.

[Baroness Pinnock (LD)]

My Lords, Clause 5 is an interesting add-on to the legislation as a whole, which is focused on non-domestic rates as applied to business premises. Here, we suddenly have one sector of businesses being pulled out for special treatment, which is curious to me. It becomes a very strange Bill with Clause 5 added to it. However, for Liberal Democrats, as I have probably said many times in the course of my public sector career, education is the single most important and best investment that any Government can make in our children, their future and the country’s future. The clause is important to us because it relates to education.

The Government’s policy in this Bill, removing the current exemption for relief of business rates, combined with the introduction of VAT and the impact of employers’ national insurance increases, will undermine two important principles for Lib Dems. The first is that education should not be taxed. All education provided by an eligible body, including universities, music lessons and tutoring, is currently exempt from VAT, and VAT should not be imposed on these things—and, hence, neither should business rates. The exemption should not be removed from these schools. The second principle is that parents have a right to choose the education setting that they believe is the best for their children. We champion choice and believe nothing should get in the way of parents making those choices.

The best outcome of all would be that state-funded education was funded at the same level as that experienced by children in the private, or independent, sector. It is curious to me that the gamut of changes that the Government are making in relation to the costs imposed on the private, or independent, sector will not release sufficient funding to make a significant impact on children’s education in the state sector, so it is hard to understand what the Government are seeking to achieve.

It has been an interesting debate. Lots of points of definition have been raised, and I hope the Minister will be able to respond to the interesting points about the importance of having an accurate definition of the sector. I look forward to his response. But in summation: education is most important, and parents have the right to choose, as long as those choices do not have a negative impact on everybody else, which in this case they clearly do not.

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It is for these reasons that I am unable to accept the amendments in the names of the noble Baroness, Lady Barran, and the noble Lord, Lord Lexden; I hope that my explanation will enable them not to press them. Furthermore, I hope that my explanation of Clause 5 will allow noble Lords here today to agree that it should stand part of the Bill.

[Baroness Barran (Con)]

Before he sits down, can the Minister respond to one point that I made? If he does not have an example today, perhaps he could write to me and share the letter with other Members of the Committee. Does he have a real-life example of where “other consideration” has regularly—or even occasionally—been used in practice to replace fees, either wholly or partly? I have visions of, I do not know, farmers arriving with trailers loaded with whatever it might be. If the Minister does not have an example now, perhaps he could let me know.

I also ask the Minister to confirm something. I take his point about the property value not necessarily being linked to the fees, but can he commit to considering, where a school charges less than the per pupil rate of state funding, whether this policy will still apply?

[Lord Khan of Burnley (Lab)]

My Lords, as the Committee will understand, it is difficult for me to talk about examples at this time, but I take the noble Baroness’s point. I would like to hear more about the examples that she has, in particular to see what examples we can discuss in depth when we meet post Committee. It is difficult to talk about non-domestic rating examples now.

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[Baroness Barran (Con)]

To be honest, I do not have examples, but the Bill suggests that fees might be paid by means of “other consideration”. I would be grateful if the Minister could write to me about whether that has ever been used, either wholly, partly, regularly or occasionally.

[Lord Khan of Burnley (Lab)]

I am happy to write to the noble Baroness on those two points; I will also pick them up when we next meet.

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Moved by

[Baroness Barran]

57: Clause 5, page 5, leave out lines 26 to 37
Member's explanatory statement
This amendment seeks to probe whether institutions providing foundation courses would be considered private schools.

[Baroness Barran (Con)]

My Lords, in moving Amendment 57, I also speak to Amendments 58 and 68. Amendments 57 and 58 are linked and refer to the same part of the Bill. The second definition of an independent school refers to an institution that is

“wholly or mainly concerned with providing education suitable to the requirements of persons over compulsory school age but under 19”,

which to me seems a definition that could be made clearer. My Amendment 57 is a probing amendment that seeks to understand whether an institution providing foundation courses required before university would be captured under this definition. It would, after all, be providing education suitable for those under the age of 19 but over compulsory schooling age. Indeed, there are further education colleges that provide such foundation courses and, if they were to be captured by this, it would be counterproductive. Of course, foundation courses tend to charge a fee but, despite that, they are not similar institutions to independent schools—or private schools, as I know the Minister would prefer us to refer to them. I would be concerned that, if they were included, it would have the potential to reduce access to universities for those from lower socioeconomic backgrounds. I hope that the Minister will be able to reassure me that this is not the case.

Amendment 58 refers specifically to the use of “wholly or mainly”, which the Minister referred to briefly in his earlier remarks. Can he clarify what this means in a numerical sense? My assumption is that it would be 50%, as it is for pupils with an education, health and care plan—the Minister is nodding encouragingly—but I would like to put the question to the Minister to confirm the criteria that the Government are planning to use. If it is different, what will it be and who would make that judgment? I wonder whether the Minister could give a couple of examples of institutions that might fall either side of the “mainly” line. If there are no examples to give today, perhaps he could write to me.

Amendment 68 seeks to protect private schools with a nursery attached from this change to the legislation. Early years providers are not included in the general definition of a private school, as the noble Lord just said in his remarks on the earlier group, but there exist a substantial number of nurseries attached to existing private schools. I hope that the Minister can see that it feels very illogical to exempt stand-alone independent nurseries from this tax but not those that are part of a wider school. Our amendment suggests exempting schools that have an in-house nursery altogether but, at a minimum, perhaps the Government would consider exempting that part of their property that relates to nursery provision. Have the Government considered this and, if not, will the Minister undertake to do so before the Bill returns on Report? Although the amount raised is small, this opens the door to the concept of taxing early years education specifically, which is a very concerning precedent to set, especially when it is a sector already suffering the potential costs of the employers’ national insurance increase. It feels counterproductive to do this at a time when the Government are clear in their commitment to encouraging early years education and giving children the best start in life. I look forward to the Minister’s response.

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[Lord Khan of Burnley (Lab)]

My Lords, Amendments 57, 58 and 68 from the noble Baronesses, Lady Barran and Lady Scott of Bybrook, concern early years provision and private further education institutions. The definition of a private school in the Bill includes institutions that wholly or mainly provide education suitable to persons over compulsory school age but under 19, where such full-time education is wholly or mainly provided for a fee or consideration. This brings private sixth forms into the scope of the Bill measure but excludes general FE colleges. The Bill also includes a specific carve-out for independent training and learning providers. Due to the mechanisms whereby the Government provide funding to these institutions, it was necessary to provide a carve-out in the legislation to ensure that these institutions did not inadvertently come into the scope of the measure.

The Government’s view is that all schools that offer full-time education to children of compulsory school age and/or to 16 to 19 year-olds for a charge should be within scope of the Bill measure. This is to ensure consistency and fairness in the Government’s treatment of private schools. The Bill measure includes stand-alone private sixth forms as well as those private sixth forms that operate as part of private schools that also cater for children of compulsory school age. Amendment 57 would remove entirely this part of the private school definition, the resulting impact of which would be that all private sixth forms would be out of scope and therefore retain charitable rate relief.

The noble Baroness indicated that through this amendment she is seeking to understand whether institutions providing foundation courses would be considered private schools. Foundation courses are a level 5 qualification and as such are classed as higher education. Foundation courses are in the main provided by higher education institutions such as universities. Institutions that are focused on the delivery of higher education are not within the scope of the Bill, and where they are charities they will continue to receive charitable relief. However, any private sixth forms that provide a few higher education courses, such as foundation courses, will still lose their relief if they are wholly or mainly concerned with providing education suitable to the requirements of persons over compulsory school age but under 19 years old. Given that business rates are a tax on property, the Government believe that this is a sensible line to draw for when the relief is removed.

Amendment 58 would amend the Bill definition of a private school. It would remove the “wholly or mainly” requirement in relation to the concern with providing full-time education suitable to the requirements of persons over compulsory school age but under 19 years old for a fee or consideration in such institutions. In business rates, “wholly or mainly” generally means over 50%. Therefore, under the Bill definition, institutions that are more than 50% concerned with providing education suitable to the requirements of persons over compulsory school age but under 19 years old, and where more than 50% of such full-time education is provided for a fee or consideration, will be within scope of the measure and will no longer qualify for charitable relief.

The inclusion of the “wholly or mainly” test in the further education definition has been drafted in recognition that there may be some state-funded institutions where a small minority of pupils pay a fee for the courses they attend. The Government understand that these circumstances are rare but may include international students undertaking further education courses where they do not qualify for a state-funded place.

The noble Baroness, Lady Barran, asked for examples of institutions that may be around 50%. Regarding these schools, which mainly provide education suitable for those over compulsory school age but under 19 years old, it will be for local authorities to implement this test. I do not think it would be right for us to say whether a particular school passes that test, but we do not expect many of them to be at the margins.

Without including “wholly or mainly” in respect of new sub-paragraph (4)(b)(i), the Bill could inadvertently capture state-funded colleges of further education, which is not the intention of the Government’s policy. Similarly, it could risk capturing fee-paying institutions that predominantly provide higher education courses if one pupil who meets the broader further education definition is present. As set out, it is not the Government’s intention to capture higher education institutions within the Bill’s definition.

I should explain that the impact of this amendment would mean that the presence of one fee-paying pupil within the age bracket as per the current definition may result in the institution being brought into scope of the Bill, resulting in it losing charitable relief. In contradiction to Amendment 57, Amendment 58 would mean that more institutions would be in scope of the Bill and so would lose their rates relief. But I understand the purpose of the amendment, which is to understand better the meaning of the words “wholly or mainly”, and I hope I have been able to clarify that for noble Lords.

Amendment 68 seeks to carve out from the Bill private schools that also provide early years provision. For clarity, private nurseries that are on their own hereditament are not within scope of the Bill definition, and where they are charities they will retain charitable relief. The Government have decided that where private schools that provide for pupils of compulsory school age also have nursery classes within the school, the presence of nursery-age children should not remove the whole school from the business rates measure. This approach best ensures consistency with the underlying policy intent.

It is for individual private schools to decide how they wish to meet additional costs as a result of the business rates measure. The allocation of costs in private schools that also provide early years provision on the same hereditament is a matter for those private schools. It is worth mentioning that government early education and childcare entitlements can be used for childcare in any approved childcare provider; this includes private school nurseries, although the numbers undertaking early years entitlement in private school nurseries are relatively small. Similarly, private school nurseries are also eligible to receive tax-free childcare funding as long as they are registered with Ofsted or an equivalent regulatory body.

Accepting these amendments would remove many private schools from the Bill’s measure. This would reduce the amount of revenue that could be raised and, consequently, may reduce the funding available to the Government to deliver on their commitments to young people and the state-funded education sector, where over 90% of pupils in England are educated. The outcome of the tax changes on private schools will have a significant impact on the Exchequer, enabling the Government to fulfil their commitments on investing in state education and young people. Together with the policy to apply VAT to private school fees, these policies are expected to raise around £1.8 billion a year by 2029-30.

I hope that this provides further clarification on the drafting of the definition, as well as on the Government’s position regarding the inclusion of private further education and private schools that also cater for nursery-age children alongside compulsory school-age children. For the reasons set out, I respectfully ask the noble Baroness, Lady Barran, to withdraw her amendment.

[Baroness Barran (Con)]

I thank the Minister for his remarks and for addressing the points I made in relation to each of these amendments, in particular Amendment 58. I heard the Minister say that relatively few schools or private providers will be at the margins of “wholly or mainly”. I thank him for the example of the international students who might be fee-paying.

On Amendment 68, I understand the Minister’s push-back in relation to exempting a whole school—I hope I addressed that in my opening remarks—but I am grateful to the noble Baroness, Lady Pinnock, for her explanation of how local authorities can separate out different parts within a hereditament. I would be grateful if the Minister could take back to the department that this measure just feels really illogical. It will not be a significant amount of money that is raised by withdrawing the relief where an independent nursery is part of a school but not withdrawing it where an independent nursery is not part of a school, particularly in the light of the noble Baroness’s expert insights into how that could be achieved.

With that, I beg leave to withdraw my amendment.

Amendment 57 withdrawn.

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Moved by

[Baroness Barran]

60: Clause 5, page 5, line 38, leave out “wholly or mainly”
Member’s explanatory statement
This probing amendment seeks to understand how many students will be required to have an EHC plan in an institution to be exempt from private school status.

[Baroness Barran (Con)]

My Lords, in moving Amendment 60, I will speak also to Amendment 61. These amendments seek to probe the Government’s willingness to extend the definition for pupils with special educational needs and disabilities, and to test the appropriateness of the 50% threshold.

Amendment 60 probes the use of the “wholly or mainly” criterion and seeks to question why the Government have chosen a 50% threshold. It appears to be a rather arbitrary number, and although in our meeting before Committee, for which I am very grateful to the Minister, he indicated there were no schools close to being just either side of that threshold, we still have concerns. I would be grateful if he could confirm again at the Dispatch Box that the Government believe there are no schools in that bracket of being close to the 50% threshold. It would obviously be helpful if the Government could publish the data that supports that. If I have misunderstood in any way, perhaps the Minister could clarify.

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[Lord Khan of Burnley (Lab)]

My Lords, Amendments 60 and 61 are concerned with the carve-out within the Bill’s measures for private schools that wholly or mainly provide education to pupils with education, health and care plans. Amendment 60 seeks to remove the “wholly or mainly” requirement, the effect of which would be to carve out from the Bill’s measures private schools that provide full-time education to any number of persons for whom an education, health and care plan is maintained.

I understand from the accompanying explanatory statement that this amendment seeks to understand the definition of “wholly or mainly”. As I have said elsewhere on a previous group on business rates, wholly or mainly generally means more than 50%. In practice, the Government believe that this will ensure that most private special schools will not be affected by the measure. We expect any private special schools losing charitable rates relief to be the exception; they will potentially be in single figures. Private schools that benefit from the existing rates exemption for properties that are wholly used for the training or welfare of disabled people will continue to do so. This general exemption means that they pay no rates.

I am aware that some concerns have been raised—the noble Baroness has raised them in clear and categoric terms—in relation to the possibility that some mainstream private schools may be just under or over the 50% threshold for the EHCP carve-out within the Bill. In private schools, including private special schools, just 5.7% of pupils have an EHCP, with the majority of those pupils in private special schools. Therefore, we do not expect there to be many mainstream private schools near the 50% threshold.

To add to that point, if there are any marginal cases, the test in law is whether the institution is wholly or mainly concerned with providing education to ECHP pupils. While it will be for the local authority to decide, this wording should avoid the need for schools at the margin to jump in and out of entitlement for charitable relief following small movements in pupils.

The majority of private special school places are funded by local authorities. The 2024 school census shows that in more than 80% of the sector more than nine in 10 pupils have an EHCP plan that stipulates that the place is funded by the local authority.

Amendment 61 would result in the exemption of fee-paying schools from the measure if that fee-paying school wholly or mainly catered to pupils who have special educational needs as defined under the Children and Families Act 2014, and regardless of whether or not those pupils also have an EHCP. The Government are aware of the concerns raised with respect to pupils with special educational needs in private schools that may lose their charitable relief, because the school is not wholly or mainly concerned with providing full-time education to persons for whom an EHCP is maintained. The Government have carefully considered their approach to ensure that the impact on pupils with the most acute needs is minimised.

The Bill provides that schools that are charities and wholly or mainly concerned with providing full-time education for persons with an EHCP remain eligible for charitable rates relief. The Government recognise that where a private school has only a few pupils with EHCPs, it will lose its eligibility for charity relief. Mainstream schools throughout the private and public sector cater for pupils with special educational needs. Most children with EHCPs already have their needs met within mainstream state-funded schools. If an EHCP assessment concludes that a child can be supported only in a private school, the local authority funds the child’s place.

The noble Baroness, Lady Pinnock, touched upon the issue of the wider problem in terms of delay, which I will address. Local authorities aim to process all education, health and care plans and the respective applications in time for the start of the next school year, so that parents can make an informed decision as to which school they send their child to. In special cases, the local authority is able to pre-pay one term’s fees if the education, health and care plan is not complete but the outcome is foreseeable. Likewise, some private schools will forgo the first term’s fees for pupils who are expected to be granted an EHC plan in the future.

The Government are committed to improving inclusivity and expertise in mainstream state schools, restoring parents’ trust that their child will get the support that they need to flourish. Private schools can provide choice, high-quality education, economic benefit and public benefit through partnerships and means-tested bursaries, but most parents cannot choose private schools. We need to improve provision for the 93% of pupils at state schools, and that is rightly our focus. The Government are also committed to reforming England’s SEN provision to improve outcomes and return the system to financial sustainability. The Government will provide an uplift of around £1 billion in high-needs funding in the 2025-26 financial year.

Mainstream schools throughout the private and public sector, as I said before, cater for pupils with special educational needs. Amending the basis on which fee-paying schools are able to retain their charitable rates relief in the way that this amendment proposes would undermine the Government’s intention to remove tax breaks for private schools in order to raise funds to support the more than 90% of pupils who attend state-funded schools. As the Committee will know, the majority of children in England who have special educational needs—with or without an EHCP—have their needs met in the state-funded sector. The approach chosen in the Bill is targeted to ensure that the impact on pupils with the most acute needs is limited.

It is for the reasons cited that I cannot accept the noble Baroness’s amendments, but I hope that, with this further information, I have provided satisfactory explanation as to the Government’s approach and reassurance that the approach adopted ensures that the impact on those children with the most acute needs is minimised. I request that the noble Baroness withdraws her amendment.

[Baroness Barran (Con)]

My Lords, I thank again the noble Baroness, Lady Pinnock, for the vivid picture that she painted in her remarks of the desperation of some parents whose children are struggling in a state-funded school, and who make huge sacrifices to send their child to an independent school. I also thank the Minister for his clarification, as I have understood it, in relation to my Amendment 60. I think he is saying that independent special schools are exempt in this legislation but mainstream ones will not be, because they are extremely unlikely to be anywhere near the 50% threshold in terms of EHCPs.

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Moved by

[Baroness Barran]

63: Clause 5, page 5, line 40, at end insert—
“(5A) An institution is not to be considered a private school for the purposes of sub-paragraph (3) if it is wholly or mainly concerned with providing full-time education where at least 7% of gross income is spent on means-tested fee assistance.”Member's explanatory statement
This amendment seeks to exempt schools where they offer bursaries or other means-tested assistance to pupils that amounts to more than 7 per cent of their gross income.

[Baroness Barran (Con)]

My Lords, in moving Amendment 63, I will speak to all of the other amendments in this group. Amendment 63 would exempt schools that provide bursaries that amount to more than 7% of a school’s income. This is a small cost, but comes at a time when private schools are already facing higher costs from the Government’s decision to impose VAT on them. I am concerned that schools will not have room in their budgets to continue providing the same level of means-tested fee assistance. I hope the Minister agrees that the provision of bursaries is an important factor in enabling children from less affluent homes to access independent education.

Amendment 64 would exempt schools which provide education for gifted arts students, including music and drama. These schools tend to be small independent schools, which will not be able to absorb the costs that the Government are imposing on them. Our worry is that they will be forced to close, and the culture that is so essential to our society will no longer be available in the same way. The Minister will know of the real concerns in this sector and the impact that it risks having on our creative industries, which are such an important engine of growth in this country. These are students who attend a private school based on their exceptional talent. I hope the Minister will reflect on how best to avoid narrowing opportunities for children who access this small group of schools.

Amendment 66 would exempt schools where 10% of pupils have a parent or guardian in the Armed Forces. If I have understood correctly, it seems unfair that while the children of foreign diplomats and international military personnel will be exempted from these additional costs on independent schools, specifically VAT, the same benefits are not being offered to the children of our own Armed Forces personnel. As such, it seems fair to suggest that the children of those personnel, who provide invaluable service to this country, are treated with the same level of respect.

I very much support the spirit of my noble friends Lord Black and Lord Lexden’s Amendments 69A and 69B. Clearly, the spirit of Amendment 69A aligns with my amendments in this group, and Amendment 69B highlights the invaluable work that some independent schools do in relation to children in care. I beg to move.

[Lord Black of Brentwood (Con)]

My Lords, I will speak to Amendments 69A and 69B in my name and that of my noble friend Lord Lexden as well as to Amendment 64 in the name of my noble friend Lady Barran, to which I have added my name. I refer to my earlier declaration of interests and, for this group, I add that I am the chairman of the Royal College of Music.

On music, let me start with Amendment 64, which is an extremely important amendment. It would have long-term ramifications well beyond the terms of this Bill because specialist music education for gifted students is central to the future of our creative economy, and it therefore needs to be seen in a wider context. As noble Lords will be aware, the UK’s creative industries are vital to our future. With the economy stalling, this is one sector which, for the time being, continues to grow. It employs hundreds of thousands of people, earns huge amounts in exports and provides an essential component of the UK’s soft power, something that is more important now than ever. Right at the centre of the creative economy is music, which powers the rest of the industry.

In turn, the future of music depends absolutely on first-class, specialist music education in schools, conservatoires and universities to provide a pipeline of talent into the sector. Without that education, music dies. However, music education, including that provided by specialist schools in the independent sector, is in trouble and has been for a long time. Music has been squeezed out of the curriculum. The number of pupils taking music at GCSE and A-level has plummeted. Many schools no longer have dedicated music professionals teaching the subject. Indeed, if pupils have access to a dedicated music professional today, it is likely to be because of a partnership with an independent school. From primary schools right the way through to the end of full-time education, music is under threat as never before.

We see the results of that every day, most recently with the appalling decision of Cardiff University to close its school of music, the largest in Wales, something that the world-renowned composer Sir Karl Jenkins has put down to the decline of specialist music education in schools. The closure of the school follows hard on the heels of the closure of the junior department of the Royal Welsh conservatoire, which has enormous repercussions for music in Wales and beyond. At such a time of crisis for music education, which I have to say has not improved in any way since the general election, despite so many promises before it, the last thing we need is for independent specialist music schools, those providing education for gifted students under the music and dance scheme, as well as the leading choir schools to be threatened. It is crucial that they continue to provide music, dance and drama teaching to the most gifted students if we are to protect the pipeline of talent into the music industry.

The future of these schools and their continuing ability to provide world-class teaching will be much more secure if they are protected from full business rates. This is not a niche subject or special interest pleading; it is fundamental to the artistic future of our country and the success of the creative economy. Does the Minister acknowledge the vital importance of the pipeline of musical and dramatic talent into our creative industries? If he does, will he explain why the Government are putting it in jeopardy in this way?

Amendments 69A and 69B deal with boarding schools. Boarding schools play a vital role in our education system, with around 65,000 boarding pupils educated in the independent sector. They contribute just over £3 billion each year to our economy, generating £900 million in revenue for the Exchequer and supporting more than 64,000 jobs. Like the rest of the sector, they are a vital instrument of soft power and one of our strongest exports. Like the rest of the independent sector, they are already under significant strain as a result of not just VAT but the damaging increase in employers’ national insurance contributions. For many, especially the smaller schools, the end of business rates relief will be a huge added burden. Already the signs of the impact are clear: the Government’s figures show that visa applications to study at UK independent schools fell by 23% in the first two quarters of 2024 compared to the same period in 2023. That is a significant straw in the wind.

Recently, one agent told the Boarding Schools Association:

“This tax penalty is making our clients think twice and wonder if the UK is still the holy grail of academia”.


Another commented:

“The reputation of British boarding is already damaged and while it was the destination 10 years ago, it is now one of many”.


With international numbers down and likely to fall further, now is not the time to be adding to the increasingly intolerable burden on so many boarding schools with the withdrawal of business rates relief.

Boarding schools play a crucial role in a number of areas, including the provision of places for military personnel serving our country at home and abroad, as my noble friend said, and for vulnerable pupils with special educational needs and disabilities. My two amendments seek to recognise their importance and, in certain circumstances, exempt them from the withdrawal of relief.

Amendment 69A would discount boarding facilities from a school’s business rates bill if 10% of boarders are on a government continuity of education allowance, or CEA. This reflects the importance of boarding provision for the children of those who serve our country and often risk their lives for it. In the last academic year, 4,000 pupils were supported by CEA for 2,666 service personnel and their families. By easing the commercial pressures on them, this exemption would give a measure of continued support and protection to schools providing places for CEA pupils and reflect the inherent public benefit in ensuring that service families have confidence that they can provide a stable school life for their children.

In the same vein, Amendment 69B would discount boarding facilities from a school’s business rates bill if that school is supporting looked-after pupils supported either directly by local authorities or by charities. It recognises the hugely important role of boarding schools in educating some of the most vulnerable children and the significant pastoral support that they provide. One of the best known charities supporting this work is the Royal National Children’s SpringBoard Foundation. The RNCSF widens access to the opportunities available for young people facing the greatest barriers to their development. Along with local authority and community organisation partners, it works with boarding and independent schools to help them target their fully funded school places on the young people who need them most and help them access them effectively. To date, it has supported more than 1,000 pupils, 98% of whom get two or more A-levels, compared to 16% of disadvantaged children.

Brentwood is one school the RNCSF works with, taking students into boarding places, hosting regional interview days and supporting its excellent campaign to help children in care who are applying to university with their UCAS applications. This is clear public benefit work, supporting not only society’s priorities for vulnerable children but assisting our stretched local authorities support children in their care to achieve their full potential. This is, rightly, an intensive and involved process for any school to engage in to ensure that pupils have the right level of support and guidance around them at school. If anything properly fits the definition of a charitable activity clearly in the public interest, it is this. My question to the Minister is: why on earth do the Government judge that the facilities that care for and support these young people are unworthy of charitable relief?

These are all focused amendments which do not in any way challenge the central tenets of the legislation but recognise the special importance and public policy significance of crucial aspects of independent education. They seek to protect those schools educating gifted students whose careers will power the creative economy, children of military families who serve our country and those who are vulnerable because of special needs. I hope the Minister will accept them. Not to do so would, frankly, be callous and short sighted.

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I hope that I have provided further clarity and reassurance on the Government’s position and that the noble Lords feel able not to press their amendments.

[Baroness Barran (Con)]

I thank the Minister for his remarks, although some of the points raised, particularly by my noble friends Lord Black of Brentwood and Lord Lexden, perhaps deserve more consideration by the Government. I will come back to those in a moment.

In relation to my Amendment 63 regarding bursaries, I think that I am right in saying that the provision of education is a public benefit in its own right, not the provision of bursaries. The noble Lord may be trying to dial up the public benefit, but education sits firmly within that definition.

My noble friend Lord Black of Brentwood was extremely eloquent in relation to my Amendment 64. I thank him for the examples that he gave of the impact of pressure on these specialist schools more widely, for the economy and for our higher education sector, as in the example of Cardiff University. As he said, these are not niche issues but absolutely central to our thriving creative industries. The Government rightly talk about growth as their primary objective but if their actions will limit growth rather than promote it, that is cause for really serious concern.

The noble Lord talked about adjustments for the music and dance scheme, but he will obviously be aware that the sector is extremely worried about what will happen after 2025-26. There is an adjustment for the current year but no visibility beyond that. Similarly, in relation to Amendment 66 and the recalculated rates for those eligible for the continuity education allowance, the same question mark remains over the longer term.

If there is one thing in this group that the Minister should reflect on very hard, it is Amendment 69B regarding children in local authority care who attend our independent schools. I join my noble friends in absolutely lauding the work of the Royal National Children’s SpringBoard Foundation.

In closing, to quote my noble friends again, whichever way the Government want to look at it, we either have clear public benefit from all the work that is reflected in the amendments in this group or we have drivers of growth, whether through international students—where, as we have heard, numbers are now at risk of falling sharply—or through providing a kind of fuel for our creative industries. Whichever perspective one looks from, threatening these schools is an unwise strategy and I hope very much that the Minister will reflect on these remarks. With that, I beg leave to withdraw my amendment.

Amendment 63 withdrawn.

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Moved by

[Baroness Barran]

65: Clause 5, page 5, line 40, at end insert—
“(5A) An institution is not to be considered a private school for the purposes of sub-paragraph (3) if it has a religious character or other special character and there is no maintained school or academy of the same character within the specified distance from the school.(5B) In this paragraph— “religious character” has the meaning given under section 69 (duty to secure provision of religious education) of the School Standards and Framework Act 1998;“other special character” has the meaning as defined by the Secretary of State by regulation;“specified distance” is the distance specified under section 444(5) (offence: failure to secure regular attendance at school of registered pupil) of the Education Act 1996.(5C) Regulations under this section are to be made by statutory instrument.(5D) A statutory instrument containing regulations under this section may not be made unless a draft instrument has been laid before and approved by a resolution of each House of Parliament.”Member's explanatory statement
This amendment seeks to exempt schools that are faith schools.

[Baroness Barran (Con)]

My Lords, Amendment 65 is a probing amendment to understand the Government’s thinking in relation to faith schools. As we have heard on numerous occasions in Committee, our concerns about the financial viability of the sector relate to the combination of VAT, the potential increase in employers’ national insurance contributions and now business rates. This combination is potentially most acute for faith schools, for three main reasons.

First, as the noble Lord knows, they often charge lower fees than other independent schools and have less financial resilience. This is particularly true for some Muslim and Jewish schools. Secondly, for parents where choosing a faith school is really important, there will often be no state-funded alternative at all locally, in the case of smaller faiths, or, for the larger faiths, provision with spaces available for these children at short notice.

Finally, if this is the case, we are concerned that this could contribute to an increase in children who are educated at home, which is something I know the Government plan to contain through the Children’s Wellbeing and Schools Bill. Our concern is that the combination of pressures on these schools will cause them to close with the unintended consequences that I have outlined. I would be grateful if the Minister could explain what assessment the Government have made of each of these three risks, and how they plan to mitigate them. I beg to move.

[Lord Khan of Burnley (Lab)]

My Lords, Amendment 65 would mean that a private school with a religious or other special character maintained its eligibility for charitable relief where there is no maintained or academy school of the same religious character or other special character within the statutory walking distance as set out in the Education Act 1996. It would create an additional delegated power within the Bill whereby the Government, by secondary legislation, would be able to define what is meant by a special character. While the amendment does not indicate what may constitute a special character, we understand from the contributions made in the other place, as well as from the noble Baroness’s contribution, that this could be used to carve out schools that follow a particular method of education or provide specialist tuition.

Amending the basis on which fee-paying schools are able to retain their charitable rates relief in the manner in which this amendment proposes would undermine the Government’s intention to remove the VAT and business rates tax breaks for all private schools. As we have said, removal of the business rates charitable relief is necessary in order to raise funds to support the more than 90% of pupils who attend state schools. The Government have carefully considered their approach and have decided that private schools that are charities will be carved out from the Bill measure only where they wholly or mainly provide education for pupils with EHCPs.

It would be inconsistent and unfair to exempt any other types of private schools from this Bill measure. However, the Government value parental choice and recognise that some parents want their children to be educated in a school with a particular faith, ethos or other characteristic, such as following a particular education method. Pupils who follow a particular faith, education method or other characteristic can be accommodated in the state sector. All children of compulsory school age are entitled to a state-funded school place if they need one, and all schools must comply with their obligations under the Equality Act 2010. In addition, schools are expected to promote fundamental British values, including the values of mutual respect and tolerance for those with different faiths and beliefs. The Government are not considering further exemptions to this policy, and therefore there is no need, as the amendment attempts, to give the Secretary of State the power to establish and define new designations of schools’ character in order to then exempt them from this measure. For these reasons, I am unable to accept the noble Baroness’s amendment.

[Baroness Barran (Con)]

The Minister says again that this undermines the Government’s intention, but then in the next breath says that the Government value parental choice. It is one thing to say that a child can be accommodated in a state school—the Minister knows that there are certain parts of the country where even that is not necessarily a given, where state school spaces are very limited indeed and therefore one is putting pressure on parents and children to travel further than is ideal—but there is not the ability to place a child in a school with a specific faith designation, particularly for smaller faiths, in the way that he suggests. I do not think one can say that one values parental choice and then not offer parents something that they have strived to offer to their children.

Again, as in relation to my earlier amendment, these are schools, as I said in my opening remarks, where the fees, particularly in the Muslim and Jewish communities, are often two-thirds or half of a state-funded place. We are very concerned that this will result in children being educated at home, which carries with it certainly limitations in terms of socialisation for those children, at best, and, at worst, potentially wider risks to those children.

[Lord Khan of Burnley (Lab)]

I am conscious that the noble Baroness made a strong point; it has just come to my knowledge that I did not address it in my response. We estimate the overall impact to be that business rates changes will lead to around 3,100 fewer places in the private sector. Of those 3,100 pupils, the Government expect 2,900 to move to state-funded schools. The remaining 200 pupils will be international students returning to schools in their home nations, or domestic students moving into home-schooling.

The noble Baroness talked about home-schooling and mentioned the Children’s Wellbeing and Schools Bill. The Government will introduce a duty on parents to inform their local authority when they choose to home-educate their child. Measures in the Children’s Wellbeing and Schools Bill will ensure that the most vulnerable children do not slip under the radar of the professionals who are there to protect them. I am grateful to the noble Baroness for allowing me to intervene to say that the overall impact of this transition for private schools is on around 3,100 pupils.

[Baroness Barran (Con)]

I thank the Minister for that additional clarification, but the reality is that it is one thing if those 3,100 pupils are spread across the country, but quite another if they are in a handful of local authorities that are already full. I beg leave to withdraw my amendment.

Amendment 65 withdrawn.

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[Baroness Barran (Con)]

My Lords, it will not surprise the Minister to know that I agree entirely with the amendments tabled in the name of my noble friend Lord Moynihan to ensure fairness and clarity in the treatment of private schools in relation to means-tested fee assistance and business rates. My noble friend was so eloquent and knowledgeable about the benefits of sport to all children. I am sure all across the Committee agree that he gave brilliant examples of both the physical and the mental health benefits. As someone who avoided sport at all costs in school and came to it later in life, I agreed with him and felt slightly guilty as I listened.

By preventing these schools being classified as private schools, the amendment highlights the value of their contribution and safeguards them from financial disadvantage. As my noble friend put so clearly, it would allow them to make sure that the sporting opportunities they offer can continue to grow, since they are so vital for our communities.

Amendment 69 addresses the valuation of sports facilities in relation to non-domestic rates and would ensure that the inclusion of sports facilities, which play such a crucial role in the development of young people, does not unfairly increase the business rates burden on schools. I am worried that the Minister will say that this amendment goes against the spirit of the legislation, so I am going to try a different approach to convince him both that this may amendment be one to focus on and to accept my noble friend’s suggestion to meet in order to try to find a way through.

First, as my noble friend said very clearly, whether we are talking about grass-roots local sport for someone as untalented and unable to hit a ball as I was or sport at the highest possible level, these schools provide opportunities in a way that we do not see widely in our communities. Secondly, my noble friend was clear about the importance of dual use for both local pupils in the wider community who do not attend the school and those who do attend the school.

The last thing I would stress is that the Minister has spoken on several occasions about the importance of raising money to invest in our state schools and the 93% of children who attend them. However, if we sat down to do the maths and tried to work out what it would cost to bring our state schools up to anywhere near the standard of what they can access in their local independent schools, I think we would find that, in capital terms, it is many times the amount that will be raised from VAT and the £70 million through this Bill.

I urge the Minister to take up my noble friend’s invitation to explore this issue and see whether we can find a way through. It is entirely reasonable to raise the bar and encourage independent schools to offer that dual use to make sure that their local communities benefit. Whether you take it from that perspective or a purely financial perspective, these amendments deserve great attention from the Minister.

[Lord Khan of Burnley (Lab)]

My Lords, I will now speak to Amendments 67 and 69 in the name of the noble Lord, Lord Moynihan. I just let him know that I have a great passion for rowing, developed at the time of Redgrave and Pinsent. Unfortunately, I was only two years old when the noble Lord won the silver medal in Munich in 1981, so I cannot classify him as my hero, but I know that he will be a hero to many across the country and the world.

These proposed amendments seek to introduce a carve-out in the Bill for private schools where 10% of students are in receipt of a bursary or scholarship for sporting excellence. I am aware that this type of fee support can be provided to any pupil who meets the requirements set by an individual private school; similarly, it can be provided on a means-tested basis. The other amendment tabled by the noble Lord, Lord Moynihan, seeks to ensure that no part of a private school that is used primarily for sport is included in the valuation of the school for business rates.

Providing means-tested fee assistance is one way in which charitable private schools can demonstrate public benefit—a requirement that accompanies charitable status. As I have stated elsewhere, the Bill does not remove the charitable status of private schools, and the Government expect them to continue to demonstrate public benefit, whether that is through the provision of means-tested bursaries or through other means, such as sharing facilities or working with state sector schools.

Ending the VAT and business rates tax breaks on private schools is a tough but necessary decision to help deliver on the Government’s ambition to eliminate barriers to opportunity by concentrating on the broader picture and towards the state sector, where over 90% of children in England are educated. Barriers to opportunity also appear in the sporting world, as I am sure the noble Lord is aware. The Government are committed to improving access to sports and physical activity for all. Everybody, no matter who they are or where they are in the country, should have access to the best possible provision of sports facilities and opportunities to get active.

These amendments would reduce the scope of the Bill measure by removing private schools from the definition and thus reducing the amount of revenue raised. This would limit the additional funding secured to help deliver the Government’s commitments on education and younger people. Furthermore, it would be operationally unfeasible to implement requiring local authorities to audit the financial operations of charitable private schools to ascertain whether they meet the threshold, as per the amendments, when calculating their business rates bill for the financial year.

I shall now address the other amendment in the name of the noble Lord, Lord Moynihan. I understand that part of the reason for it is a recognition that some private schools share their sporting facilities with neighbouring schools or the general public. As I have said, the Government expect private schools that wish to remain charities to continue to demonstrate a public benefit, such as by making their sporting facilities available more generally. That will not change. The amendment seeks to remove sports grounds from rating valuations. Exemptions of this nature, where part or all of a hereditament is removed entirely from rating valuations, are the most general and exceptional forms of support in business rates. They are reserved for cases such as agricultural land, places of public religious worship and, as we have already heard during the passage of this Bill, certain property used for disabled persons.

Despite the clear value of shared sports facilities at private schools, I do not think that it would be right to confer upon them such a level of benefit, especially when exemptions of this nature are not available to other sports facilities or even to charities more generally. Although these facilities are being used for sports and may be shared with the community, they remain part of private schools and are clearly used for their purpose; indeed, for many private schools, such sports facilities are a vital part of their offer to parents. It would therefore hardly be consistent with the overall purpose of Clause 5 to exclude them.

This story is very personal to me because I was an aspiring cricketer and did not make it through the system. I know that that was because of a lack of facilities and support at my local clubs and my local school, so I understand entirely the premise of what the noble Lord, Lord Moynihan, is attempting to do. I say to him and the noble Baroness, Lady Barran, that I will take this matter away and reflect on it; I will speak to colleagues, officials and other colleagues in the Treasury.

Let me let noble Lords know that the Government are committed to improving access to sport and physical activity for everybody. Sport and physical activity are central to achieving our health and opportunity manifesto missions, with the biggest gains coming from supporting those who are inactive to move more. Everyone, no matter who they are or where they are in the country, should have access to the best possible sports provision and facilities. The Government’s arm’s-length body, Sport England, is investing £120 million between 2025 and 2029 to increase participation in sport and boost diversity at the grass-roots level in order to give more and better opportunities to all young people to explore and develop their potential. This funding will increase and enhance opportunities for talented young athletes in England to explore and develop their athletic potential, regardless of their background or financial circumstances. Through creating more inclusive talent pathways, the Government want to increase participation in sport and boost diversity at the grass-roots level in order to give all young people more—and better—opportunities to explore and develop their potential. Sport England also wants to drive greater diversity within national teams, which will in turn demonstrate to the next generation of young people that they could have the same potential to reach the Games.

The PE and sport premium is a ring-fenced grant for eligible primary schools and other educational establishments. In March 2023, as noble Lords will recall, the previous Government announced more than £600 million of funding for the 2023-24 and 2024-25 academic years. Schools must use funding to make additional and sustainable improvements to the quality of the PE, sport and physical activity that they provide.

I just want to say that this is a vital debate. I thank the noble Lord, Lord Moynihan, for his contribution. The noble Baroness, Lady Barran, said something interesting: she was not interested in sport early on but got into it in later life. Let me be absolutely clear: I learned to swim only last year. I was taught by my daughter; my 10 year-old daughter taught me to swim. I would have loved to have swum much earlier but I did not have the opportunity, resources or means to do that, so I recognise exactly the sensitive nature of what we are trying to do. The Government are supporting this through their work and funding. In particular, I recognise that the PE and sports premium is a ring-fenced grant. We must make sure that all children are supported. I thank the noble Lord for his contribution but, for the reasons I have set out previously, at this moment in time, I am unable to accept these amendments; however, I hope to go away and reflect on what the noble Lord said. In the meantime, I hope that I have provided the noble Lord with satisfactory information in relation to the difficulties and technicalities in these amendments, and I ask him to withdraw his amendment.

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[Lord Black of Brentwood (Con)]

My Lords, I support all the amendments in this group but I shall speak in particular to Amendment 72A in my name and that of my noble friend Lord Lexden. I refer to my earlier declaration of interests.

The Minister has been very emollient and courteous in batting off all our amendments today; I thank him for the way he has dealt with them. Although he and his colleagues throughout government like to bury their heads in the sand and pretend otherwise—as we have seen, I am afraid—the impact of their onslaught on independent education, of which the removal of business rates is just one strand, will have profound ramifications for not just the sector and the children educated in it but a wide range of public policy areas. This is a bit like that game of Jenga, which we have probably all played, where blocks of wood are taken out until a point comes where the removal of one of them causes the whole edifice to crumble. That is what is in danger of happening here, with the sustained attack on independent education in danger of causing policy failure in a wide range of other areas.

Consider quite how far-reaching are the consequences of this policy underpinned by Clause 5. It impacts on public health and the care of vulnerable children; on the future of music, drama and the arts in the UK, which we have talked about today; on military families and defence personnel; on state schools, whose class sizes will increase; on multiculturalism and respect for different faiths; on jobs, export and investment; on local communities, volunteer groups, charities and so on, which depend on partnership with independent schools; on sport, as we have heard so eloquently described; and on soft power and Britain’s standing abroad. As a result of this web of different aspects that will be affected and will impinge on so many different aspects of government policy, it is vital there is an impact assessment of the consequences of Clause 5 taken in conjunction with the Government’s other policy changes. That is what my Amendment 72A provides for.

Apart from everything else, Parliament has a continuing responsibility to scrutinise the Government’s actions in this area. That is what this House, in particular, is here for. To do that, we need not just the data provided by the industry’s own excellent associations but data from across government and a detailed assessment of its implications. Given the profound changes to policy that Clause 5 exemplifies, ripping up five decades of orthodoxy about parental choice, such an impact assessment is the very least we should expect to allow us to fulfil our responsibilities and make clear to the public what its consequences are.

[Baroness Barran (Con)]

My Lords, I shall speak to Amendments 71 and 72 in my name and express my support for Amendment 72A in the name of my noble friend Lord Black of Brentwood. Amendment 71 would require an impact assessment on rescinded facilities that private schools offer to state schools. Amendment 72 would require an annual statement of how many pupils have been moved into the state system as a result of Clause 5. Many in this Committee have expressed concerns about the impact of the combined tax measures on private schools introduced by this Government. We had a number of examples from the noble Baroness, Lady Pinnock. The changes announced in this legislation, combined with VAT applied to private schools, will no doubt harm many institutions. Indeed, as we have heard, we are already seeing the consequences of the Government’s decisions, with a number of private schools, including, most recently I think, Bedstone College in Shropshire, closing their doors.

As my noble friend Lord Lexden said in relation to an earlier group, there appears to be an emerging trend of small, rural private schools being particularly vulnerable. This raises the real risk of thousands of pupils across England being displaced and moving into the state system. As we discussed earlier, in particular parts of the country, that is not much pressure on the state system, but is potentially the reverse. However, in some parts of the country, such as Bristol or Surrey, schools are operating at full capacity. It is essential that we have proper oversight and transparency of the impact of this legislation on the state sector. It is with that in mind that I tabled Amendment 72. I also welcome Amendment 70 in the name of the noble Lord, Lord Storey. It is clear that all of us share many of the same concerns.

On Amendment 71, as we have heard, many private schools have a long history of collaboration with state schools and of sharing their facilities and resources. My noble friend Lord Moynihan gave an eloquent exposition on the value of sports grounds, but theatres and science laboratories provided by private schools offer many state school pupils opportunities that otherwise they might not have. Therefore, the closure of such schools would be felt by state school students as well as private school students as they would lose access to these resources. The Minister says—and I understand why—that it reflects the Government’s expectations for these schools to continue to offer public benefit, and one option for that is sharing their facilities, but, as we have heard, their income is being pressured from a number of different directions, including by this legislation, so I urge the Minister to consider my Amendment 71 and all the others in this group.

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[The Earl of Lytton (CB)]

My Lords, I support the amendment in the name of my noble friend Lord Thurlow, which relates specifically to Clauses 1 to 4. The business community was clearly expecting something rather different from what we have before us now, based on the Labour Party manifesto, so ably referred to by my noble friend. At the very least, we should be told the plans for where and when this longer-term reform, which was promised, will be mapped out. While the Treasury cannot make an accurate impact assessment until the new valuation figures are known, equally, businesses and their professionals have no idea either.

This rather matters, because it is not just a new list, as we heard from the noble Lord, which itself would come with inevitable transition arrangements, there is also the impact of the lower multipliers and the increased burden of supplements, which we believe will not be known until the Autumn Statement: that part will not be known, even if the contents of the new valuation list are known in advance. I am very doubtful whether lower multipliers will do much to move the dial on this, but I think the supplements will probably be a different matter altogether.

There is another point, which the noble Lord, Lord Lexden, touched on a few minutes ago. Parliament is entitled to be properly informed about the likely impact. I have suggested previously that this is not impossible, even without firm figures. The fact that the Government are not prepared to do this is, I feel, of particular concern, because they therefore cannot demonstrate that their policies on multipliers are actually competent and will achieve the support supposed and the rebalancing that has been claimed. For those reasons, I support the amendment, and particularly that more time should be allowed to consider the impact, to in some way soften the introduction and give businesses space to consider their options.

[Baroness Barran (Con)]

My Lords, I shall speak to my Amendments 75 and 76. Amendment 75 is a probing amendment to ensure that the Government have considered and made an assessment of how the provisions of the Bill will impact on the ability of students on bursaries to access universities. Despite the picture that the Government are trying to paint, private schools provide genuine benefits to their local areas and offer education at a significantly reduced rate to families, including low-income families, through their bursary schemes. We also know that pupils from independent schools are more likely to go to university. If, as was discussed in earlier groups today, these schools cannot find enough money to provide bursaries, or not in the same quantities as before, these students will no longer be able to access the same opportunities. With this in mind, I hope the Minister can reassure me that the Government have thought about this and perhaps give the Committee his assessment of its impact.

Amendment 76 would delay the implementation of Clause 5 until 2026 to allow schools time to prepare properly. Despite this not causing a large fiscal impact on schools, they are facing a number of changes and have not being given time to adapt and readjust their budgets—most notably, of course, in relation to VAT—and this is having a real and very negative impact on the ground. As we have heard in Committee this afternoon and as the Minister knows, some schools have already closed as a result of the very abrupt imposition of VAT in the middle of the school year. The amounts in this section of the Bill will make very little difference to the Government and there is no real reason to implement immediately. Rather, it would show some good will on the part of the Government to give schools time to prepare.

Turning to Amendment 74 in the name of the noble Lord, Lord Thurlow, although we are not supporting this specific amendment, I agree with him that what is lacking from the Bill is any firm indication or clarity about what its impact will be. My understanding, and perhaps the Minister can confirm this, is that the Government will not decide the multipliers until after the spending review, although I think the noble Lord, Lord Thurlow, suggested that it might be earlier. Therefore, as we have discussed throughout Committee, not having published an impact assessment is a failure on the part of the Government. I agree with the noble Lord that not enough is known about the impact that the Bill will have on our economy and, crucially, on our high streets.