Question to the Department for Education:

To ask His Majesty's Government what plans they have to fund local authorities’ additional school capital needs for any potential increase in pupils in local authority maintained schools, as a result of levying VAT on private school fees.

The government anticipates that the number of pupils who may switch schools as a result of the proposed VAT changes affecting private schools represent a very small proportion of overall pupil numbers in the state sector. Independent analysis by the Institute for Fiscal Studies suggests that it will represent an increase of less than 1%. HM Treasury will publish a Tax Information and Impact Note at the Budget on 30 October, which will set out its assessment. These small pressures will be considered as part of business as usual capital allocations.

Ensuring schools have the resources and buildings they need is a key part of the department’s mission to break down barriers to opportunity and give every child the best start in life.

The department has allocated £1.8 billion in capital funding to improve the condition of school buildings for the 2024/25 financial year. This funding, which includes school condition allocations and the budget for the condition improvement fund programme, was based on a methodology that takes account of data on condition, location and pupil numbers weighted by phase of education. Pupil number data was taken from the spring 2023 census and the 2022/23 Individualised Learner Record. Details of the methodology are published on GOV.UK.

The department provides capital funding through the basic need grant to support local authorities to provide school places, based on their own pupil forecasts and school capacity data from the annual school capacity survey. Over £700 million of allocations have been confirmed to support local authorities to create school places needed in September 2025 and September 2026.

£850 million has also been allocated to local authorities for 2024/25 to support them to provide sufficient school places for children with special educational needs and disabilities, or who require alternative provision. This funding was allocated using data from the school census, the Special Educational Needs survey (SEN2) and the school capacity survey (SCAP23).

School revenue funding for the 2024/25 financial year has already been allocated using pupil numbers recorded in the October census 2023. The department is also providing almost £1.1 billion through the new core schools budget grant (CSBG) to support schools with their overall costs. CSBG allocations for the 2024/25 financial year (September 2024 to March 2025) have also been calculated by reference to the October census 2023.

The department’s expenditure limits for 2025/26 will be agreed at the Budget on 30 October. This will also confirm budgets for 2024/25. This includes the 2025/26 core schools’ budget and school capital budgets.