Labour's Tax on Education Has One True Goal: to Abolish Private Schools

The Private Education Policy Forum says it will be fine to go ahead and tax education, like no other country in the world, because even if schools or parents won’t (or can’t) cough up, the schools can just transfer into the state system. The only thing these Marxists want is more people in state education, ideally on an ‘equal’ basis (equally atrocious is absolutely fine) so they don’t really care about the costs of this latest ploy, because they don’t care about any of the costs of their nihilistic destruction.

They do, however, unwittingly prove that this policy isn’t about raising revenue, it’s about destroying as many as possible of the world’s best schools.

Introducing PEPF

The PEPF claims it exists to “reduce inequalities relating to private schools and fee-paying education by platforming research and debate”. A couple of observations:

You’ll note its cares about “inequality” – but there’s no mention at all of choice, quality, innovation or diversity (such as special needs provision, performing arts, or high-ability children who are notoriously poorly-served by mainstream schools). That’s quite a list of things not to care about if it was remotely interested in improving education outcomes for anyone.
It does care about family, but only in the negative sense. If you read its turgid prose, you’ll realise that families that do terrific things for their children, which could include sending them to private school, are the selfish scum of the earth. Meanwhile where families do a less terrific job (in situations ranging from unlucky to blameworthy) you’ll find they don’t need help, encouragement, education, cajoling, better incentives or direction – so that they become better families – they just need the state to replace them.
It doesn’t care about all inequality, however. The much greater inequality within the state system is absolutely fine. So privately-educated Francis Green and David Kynaston are totes in the clear for having sent their own children to grammar schools. Nice people.

These people are on a mission and it’s a simple one: trash the private schools. The connection between the Education Tax and improving education – for anyone – is for the birds.

The latest idea: nationalise the schools

So according to this Sunday Times article, private schools hit by VAT on fees could join state sector:

Private schools forced to close when VAT is levied on school fees could become state run under plans being developed by the architects of Labour’s flagship manifesto promise.

The Private Education Policy Forum… has advised Labour on its policy. … Francis Green first began working with Labour when the VAT policy was devised by Jeremy Corbyn in 2017. He and other PEPF members have since helped Bridget Phillipson, the Shadow Education Secretary, make it one of Labour’s core manifesto promises.

The PEPF is developing proposals that will look at “routes to conversion” for private schools that decide to join the state sector, particularly those left struggling with the increase in fees. A spokesman said that “changes to VAT and ethical imperatives among head teachers may encourage some schools to switch”.

Objectives of the Education Tax – a reminder

The aim of the Education Tax is to raise £1.51bn (according to Labour’s Manifesto, a little more than the IFS’s ludicrously optimistic £1.3-1.5bn estimate), in order to spend more on state education. Starmer says he wants private schools to thrive and we’re therefore asked to believe the Education Tax is a tidying-up exercise, a sensible revenue raiser, a nice little corner of life unsullied by Government that cannot be tolerated.

For the policy to raise £1.5bn, it has to be the case that only a very small number of children leave their schools, and all schools continue with their existing business, and no schools cut their costs. I’ve written at length about why this won’t work, for example here and here; it was catastrophic when the Greek Marxists tried it; the backers of the tax are completely and deliberately out-of-touch with its effects

Review of the latest from PEPF

So here we have the PEPF saying schools will indeed “struggle with the increase in fees” and could be “forced to close”. Never mind that it’s a departure from the script – consistency and the avoidance of hypocrisy clearly aren’t a big deal for Green and friends. What happens if some schools, or lots of schools, take up the suggestion and transfer themselves into the state sector?

Here’s my analysis, starting with the easy ones:

A school switching to the state sector means the state earns nothing from the Education Tax.
A school switching to the state sector means the state incurs immediate expenses:
1. Per-child costs of around £8,000 a year.
2. Losses on the direct, indirect and induced taxes generated by the independent sector, valued by Oxford Economics at £5.1bn a year or around £9,000 per child.
The state also acquires the liability for the buildings, which may include Grade 1 listed architecture. Since we are always being told the buildings are so lavish because all schools are like Eton, the state has to choose: pay the utility bills and maintenance costs that go with them, face the expense of repurposing them, or break the law by letting them fall into disrepair. It’s just one of the elisions made in discussion of this tax: “Boo, your kids get educated in a 300-year-old palace.” Indeed they do, and that makes for a pretty impractical, uncomfortable and expensive operation, it’s not all a “privilege”. And now paying for it becomes a “privilege” for taxpayers.
Since the school must operate on the state’s per-pupil costs, it will have to increase its pupil-teacher ratio (PTR). On average, state sector PTR is double the independent sector
1. That probably implies a huge rebuild project to increase classroom capacity. And repurposing Grade 1 listings? A famously reasonably-priced activity, I’m sure local authorities can’t wait to add that to their priority list.
2. It also implies doubling pupil headcount, raising the question of where those pupils will come from and what will be the impact on the surrounding state schools. Reducing the closure risk of under-populated state schools, in future (given predictions of falling rolls) and in some areas (many others being heavily oversubscribed), is transparently one of the drivers of the policy. Is it okay if state schools now close in this instance, given the gleeful triumph the PEPF will feel when an independent school is nationalised?
3. Or, it implies halving teacher headcount, raising again the question of whether the PEPF or Labour Party has the courage to look teachers in the eye. Is this the first time a Labour Party has taken such an anti-labour position?
Moving to reduced funding implies reduced pay for teachers, particularly senior ones, and thus a reduction in payroll tax receipts. ‘Labour’ indeed.
Unless the school becomes a free school or grammar school (which is most unlikely as Labour will block it) it will lose control of admissions. It cannot be assumed that parents will sign up to it. This is typical Stalinist thinking. PEPF imagine schools, families and children are just like little Lego people, and they can move an entire school onto a different footing without affecting either attendance or the local education economy. Maybe half the parents do a runner and the state is left holding a sub-scale school and has to pay redundancy costs.
Of course, you might answer that it’s okay if the school just closes, and the state gets a boondoggle in the form of the land, which it can then dispose of at will. A few problems with that:
1. A privately-owned school will definitely not voluntarily part with valuable land at below market-price.
2. A charity, if it has valuable land ‘to spare’ is more than likely to have sold it or developed it for rent already to stay afloat; it’s not clear that it will quietly ‘give’ the land to the country at no charge, or whether the Board can be assumed to agree to do so, or even whether its charitable objects would allow it to do so.
3. Developing land within the curtilage of a Grade 1 listing is likely to be against the law – and it’s not immediately obvious what valuable alternate purpose those buildings themselves can be used for. They aren’t very practical as mansions for oligarchs, and it’s unlikely there’s much demand as ultra-luxury hotels or golf courses.

All in all, it’s yet another part of the Education Tax Policy that needs to be filed in the cabinet labelled “not figured out yet”.

Conclusion

Anyone remotely serious about improving state schools would have started by looking at ways to do so without spending money, noting some schools in both sectors produce world-class outcomes on meagre resources. However, if we accept for argument’s sake that the key is, indeed, to spend money, the next question is how to raise it.

Anyone remotely serious about improving state schools by spending money would want to raise money in the most predictable, least harmful way – and not choose a tax that risks forcing significant expense back into the state system thus soaking up its own revenues.

The PEPF enthusiasm for absorbing independent schools into the state system, at great expense and with hefty risks, tells us it is not serious about improving state schools. Its approval of this costly scenario doesn’t persuade anyone that it has ‘all bases covered’ for the policy, it just proves it’s a terrible policy.

It is only serious about closing private schools. That’s what it considers an “ethical imperative”. At any cost.

Mr. Chips is a pseudonym for an employee of a private school. He writes on Substack.