Labour blames private schools for ‘pricing out’ middle classes in row over VAT on fees

Labour has hit back at criticism of its plans to impose VAT on private schools, blaming inflation-busting hikes in school fees over the years for “pricing out the middle classes”.

In an exclusive interview with The Independent, shadow education secretary Bridget Phillipson suggested that above-inflation fee increases by private schools had made it politically easier for Labour to impose 20 per cent VAT on fees in order to fund 6,500 more state-school teachers. She said private schools had already “priced out” middle-class families.

“I think private schools, because they’ve whacked up their fees way beyond inflation, year after year, have priced themselves out of the reach of many middle-class parents who would, in the past, have looked to independent schools and might have considered it as an option,” she said.

Ms Phillipson said she holds no grudge against parents who choose private schools, but believes it is a question of priorities.

“I respect the rights of parents to decide where they choose to educate their children. If they determine that the best place for their child is within a private school, that’s absolutely their right,” she said.

“I just believe that we need to make sure we’re prioritising public money, and we shouldn’t be giving unjustified tax breaks to private schools, who are their own businesses and can make choices about how they manage their budgets and can plan accordingly.”

Private school fees rose by 8 per cent for the 2023-24 academic year, with a place at a day school now costing on average £18,000 a year, according to recent figures.

The figures, from the Independent Schools Council (ISC), also showed a drop in enrolments at private schools, which the organisation says is driven by concern over costs. Barnaby Lenon, the chair of the ISC, said Labour’s plan to charge 20 per cent VAT on fees is “looming large in parents’ minds” and that schools are concerned about pupil recruitment and retention.

Ms Phillipson said that the plan to bring in 6,500 new teachers will be “a day-one priority” and that the VAT on independent school fees will be announced in Rachel Reeves’s first Budget. It is expected that the measure will affect fees from September 2025.

She said that her own experience at school had made her determined to improve state education.

She was at school getting ready to start her GCSEs when Tony Blair came to power with his mantra of “education, education, education”, and found that it gave her a route out of a deprived area in the North East – first to study at Oxford University, and from there to being on the verge of becoming one of the top ministers in the first Labour government in 14 years.

“I was 13 in 1997 when Labour got elected, and it felt that we mattered once more. As a young woman growing up in the northeast of England, it had been pretty tough for quite a long time,” she said.

“Our schools had really struggled, and it felt that, for once, we had a government that was going to be on our side, determined to deliver better life chances, and invested in education to make that a reality.

“I’m determined that, as education secretary in the next Labour government, if we win the trust of the British people, I’ll renew ‘education, education, education’ for the next generation of children and young people, who deserve a better start in life than is the case right now.

“I believe that the town that you’re from, the family into which you’re born, shouldn’t determine what you should go on to achieve. Yet, for too many children in our country right now, it does limit the opportunities that are available for them. And I’m determined to change that.”

Ms Phillipson has spoken before of how she grew up in a council house in Washington, near Gateshead, with no upstairs heating. Her mother, a single parent who founded a charity for women who suffered domestic abuse, wanted the best for her daughter, getting her violin lessons as well as a role as an extra in the children’s TV drama Byker Grove.

Ms Phillipson has spoken of being “ostracised and bullied” at school because she was poor. School, though, would become a path to success.

“Education transformed my life, and the brilliant education I had at local state schools made all the difference. The teachers that supported me were amazing, talented, and really inspiring people, and I want to make sure that we are supporting the amazing people working right across our schools, who’ve been under enormous pressure, and that we attract more people into teaching – that teaching, once again, becomes the go-to destination for our best graduates.”

She remembers one teacher – Zahida Haq, who taught Spanish and started the school’s first girls’ rugby team – with particular fondness, saying that she helped her and others to broaden their horizons.

“She was an amazing teacher, and has gone on to become a fantastic school leader, and now works on supporting schools to improve, schools that have been experiencing some challenges. She was brilliant, not just because she had a real passion for our subject, but because she believed in us and wanted the best for us.

“She came from a very similar background to all of us in that room. She grew up nearby on a council estate, and had broadened her horizons through education.”

Ms Phillipson’s early life experience is one of the reasons she is looking to expand the provision of free school meals for all primary school children – a policy championed by London mayor Sadiq Khan – which would end the stigma for those whose families cannot afford to feed them.

“I spent part of my childhood on free school meals. Our situation improved over time. As I got older, we had more money coming in. But when you’ve only got one income, when you’re in a single-parent family, that’s always going to be tougher.”

The Labour manifesto has pledged to introduce free breakfast clubs for all primary school pupils.

“I believe that our commitment to universal free breakfast clubs will make a really big difference, not just in making sure that children start the day having had a good breakfast,” she said. “The evidence is clear about the wider benefits that breakfast clubs deliver – improved attendance and behaviour, and better academic outcomes alongside that.”