Independent Schools: VAT Exemption

Lord Addington Excerpts

Thursday 5th September 2024 Lords Chamber

[Lord Addington (LD)]

My Lords, this is a debate that I never thought I would be taking part in, the tone of which we should note. We on these Benches do not like what is going on here in education. Different bits of the education sector are being taxed differently. With special educational needs, you can claim some of the money back. Well, that is always going to run smoothly; there will never be a cashflow problem and nobody will ever get it wrong. Also, it is dependent on that wonderful thing, an education and healthcare plan.

If there is a more unloved bit of the education sector than the education and healthcare plan, I have not seen it. It takes about two years to get—if you have the right lawyer and the right type of parents, who fight for it. Schools are blocking it because they do not want it to go through. The weirdest thing about it is that we have broken the £100 million barrier of public money going into resisting it and going to tribunals. Some 90% plus of the tribunals are granted—it is almost a rite of passage.

If the Government had said that they would help the private sector in dealing with special educational needs, having dealt with this first, they would be getting a much more favourable hearing from me. It is an absurdity to base an exemption on something that favours—guess who?—the educated, wealthy parents who can afford the legal fees to get through. There is something fundamentally wrong here.

I am in favour of making sure that we get better provision in state schools to address special educational needs. However, the whole system has gone wrong. If it is based around this, I cannot see how it is going to happen. Let us remember that private education has been looking after X amount of those with SEN for more than half a century; it is a very established pattern.

Also, the schools doing this have a percentage of pupils who do not have the plan, often because their parents are not prepared to put themselves or their children through the delays and the process of getting that plan. They are creating a critical mass for the economic reality of that school. If we lose these, or a percentage of these, what happens to those schools?

I hope that the Government have, at some point, done an analysis of how many pupils they can lose from this sector. The Government have recognised that it is important, so I hope they have. For pupils who do not have a plan for leaving the sector or going back into a state school, it would help to know the economic benefit. I do not know what it is—is it positive or negative? It would help if we could find out.

This contribution from the independent sector is clearly necessary at the moment. I hope the Government will tell us what they are going to do that will mean it is not necessary. Can they please tell us how they will do this, and when it will arrive? I do not like the idea of people having to go to independent schools to get the education they need but, at the moment, it is clear that they do. Will the Government address this problem in the round, and will they tell us when they are going to get rid of the plan?