State schools unprepared for flood of pupils sparked by Labour’s VAT raid

Sir Keir Starmer wants to end tax breaks for private schools to bring in more revenue – Yui Mok/PA

State schools are not prepared for the “influx” of pupils that would stem from Labour’s VAT raid on private education, government sources have warned.

Sir Keir Starmer has made ending tax breaks for the independent sector a flagship policy, claiming it would generate as much as £1.7 billion to spend on publicly-funded education.

The opposition’s plans are prompting warnings of an unsustainable “influx” of children into the state system, while new figures show councils across the country have at least one year group with no remaining places despite a likely exodus of private school pupils.

In one of its strongest interventions on the topic to date, the Department for Education accused Labour of “blindly ignoring” the consequences its planned tax raid would have.

A government source said: “This Conservative government has already created nearly 1.2 million additional pupil places since 2010, with many more in the pipeline.

‘Playing party politics with children’s education’

“Despite this, our schools aren’t prepared for an influx of thousands of pupils being pushed out of independent schools as a result of Labour’s education tax.

“Labour are playing party politics with children’s education, blindly ignoring the impacts on children and schools.”

It came as analysis by the Adam Smith Institute (ASI) revealed 28 out of 111 councils surveyed had at least one year group with no or “net negative” school places.

This means that they are either already operating beyond their planned capacity or would do so following a likely rush of new pupils under Labour.

And 95 per cent of local authorities that responded by the think tank said they could not estimate how many pupils would migrate from private schools to the state sector in the event of a Labour government, suggesting most local authorities are not currently prepared for an exodus of any scale.

The Institute for Fiscal Studies has estimated between 3 and 7 per cent of children would migrate to the state sector if a future Labour government ends VAT breaks.

Other studies have questioned the assumptions behind this figure and suggest that the true number could be up to a quarter of all private school pupils.

‘We urge policymakers to exercise caution’

Maxwell Marlow, the director of research at the ASI, said: “These findings confirm the significant concerns about the abilities of local authorities to plan for the already unpredictable consequences of levying VAT on independent school fees.

“If councils either have not or cannot plan, then we could see the state sector becoming overwhelmed, and competition for our schools intensifying, reducing opportunities for talented and less well-off pupils across the system. We once again urge policymakers to exercise caution.”

Separate ASI research previously found that Labour’s private school policy could actually cost the taxpayer £1.6 billion a year if it forces a quarter of pupils into the state sector.

Earlier this year, a poll of 350 independent school leaders for The Telegraph found that nearly all were planning to increase their fees to meet the cost of VAT being imposed.

A Labour spokesman said: “Labour will invest in delivering a brilliant state education for all our children, funded by ending tax breaks for private schools.

“Independent schools have raised fees above inflation for well over a decade and do not have to pass Labour’s proposed change onto parents.”

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