Independent School Fees: VAT

John Hayes Excerpts

Wednesday 21st February 2024 Westminster Hall

[The Financial Secretary to the Treasury (Nigel Huddleston)]

It is a pleasure to serve under your chairmanship, Mr Henderson. Please allow me to start by congratulating my hon. Friend the Member for Northampton South (Andrew Lewer) on securing the debate. What a pity we have only 60 minutes, because there was so much more to say here. We heard some fascinating and thoughtful contributions on the matter of independent school fees and VAT.

It will not surprise anyone present to hear that I agree wholeheartedly with Government Members, and I am very pleased to hear from our Lib Dem and DUP colleagues, who support the Government’s policy to allow independent school fees to be exempt from VAT for the many valid and obvious reasons expressed by hon. Members and right hon. Members today. Those include the incredible impact that they have on communities, the partnering, their impact on so many people’s lives, and the fundamental principle of choice.

I am afraid that what we have heard from the Opposition is what we hear consistently. Perhaps we might all be sighing with relief soon when we get the inevitable flip-flopping on this policy—I do not believe for one minute that it is wholeheartedly supported by Opposition Members. It is just virtue signalling of the highest order. It is complete left-wing populist virtue signalling by the Opposition, but the British public see straight through it. This Government understand the vital role that education plays in all our lives. Just this year, school funding will total about £57.7 billion, and next year it will be £59.6 billion. I am very proud to say that that will be the highest ever real-terms spending per pupil under the Conservatives.

[Sir John Hayes (South Holland and The Deepings) (Con)]

I am grateful to the Minister for giving way; I learned as a shadow Minister and a Minister that it is better to be gracious. The Minister will understand that one of the best arguments for independent schools is that they often innovate. My right hon. and learned Friend the Member for Fareham (Suella Braverman) was involved in establishing a school that innovates and breaks new ground. From Steiner schools to Bedales to Summerhill, those schools could only exist in the independent sector. How does the Minister think that the Labour party perceives that, or does it not perceive it at all?

[Nigel Huddleston]

My right hon. Friend, as always, talks very sensibly about this. The independent sector is a major contributor to our ecosystem. Of course, many teachers flip flop between the different sectors; the innovation in the private sector can also help the state sector, which is one of the many benefits that we have heard about today. In terms of the broader performance in the education system, not only do the Opposition consistently talk down the economy, our constituencies and our businesses but they also talk down our teaching profession. Actually, it is incredibly successful and we should be proud of what teachers have achieved.

Our commitment to quality education has seen 89% of all schools achieve “good” or “outstanding” at their most recent inspection, an increase from 68% back in 2010 under Labour. In the programme for international student assessment, our rankings for reading and maths improved by 10 places from 2015 to 2022 to ninth and 10th across the Organisation for Economic Co-operation and Development countries. Within that mix, as we all know, England performed better than Labour-run Wales or SNP-run Scotland, despite their higher funding. If we want to see what would happen in education under Labour, all we need to do is look to Wales—it is not an impressive performance. In the latest paediatric adverse childhood experiences and related life-events screener assessment of reading for 10-year-old students across 57 education systems, England ranked fourth internationally. I think we can all accept that those are good things.

This Conservative Government believe that there is a broad public benefit in the provision of education. That is why many education and training services are exempt from VAT, which includes an exemption on independent school fees. Labour does not seem to recognise the public good, as my right hon. Friend the Member for South Holland and The Deepings just mentioned. It wants to charge VAT on school fees and end business rates relief for private schools, taxing aspiration and inevitably putting more pressure on state schools.