Cost of private school to double in a generation to £380k

Telegraph

3 days ago

The cost of educating children in private schools will almost double after Labour's VAT raid, analysis suggests.
Parents of a pupil joining reception this September would be expected to pay £377,000 in school fees up until Year 13, according to Weatherbys private bank.
By comparison, for privately-educated pupils collecting their A-level results this week, parents would have spent £205,000 over the course of their education.
These figures assume annual inflation of 3pc, which accounts for two thirds of the price increase, with Labour's VAT levy responsible for the rest.
For children attending boarding school, the cost of sending a child from Year 3 to Year 13, assuming they spend the first three years of their education at a day school, will reach £763,000 – up from £413,000 currently.
Weatherbys said that while the increase is just under double what today's school leavers would have paid, parents should budget for a 100pc increase.
Oliver Barnett, head of private clients, said: 'This degree of uncertainty may make parents feel concerned. The key thing is to be realistic about the costs of private education from the start and to make robust plans with your adviser.
'Often grandparents help with school fees and this can be part of their inheritance tax planning.'
Mr Barnett also warned parents to think carefully about the long-term viability of any school chosen.
The Telegraph is aware of 48 schools that have so far closed citing Labour's 20pc levy as the main reason.
This week, Our Lady's Abingdon, a 160-year-old Catholic school in Oxfordshire, announced it was closing with immediate effect, leaving hundreds of pupils without a place for September.
Governors for the school blamed the VAT raid for its 'sharp decline in pupil numbers' as well as the rise in employers' National Insurance.
Mr Barnett said: 'Pupil numbers have fallen by 5pc in the key intake years of reception, Year 3 and Year 7. In addition to falling rolls, private schools have lost their eligibility for business rates charitable relief – and then there's the increase in employer National Insurance contributions. So costs are rising sharply.
'Many established schools will sail through this, but for others it will be tough. You want your child settled in a school, and if it closes partway through their education, that can be terribly disruptive.'
Alice Haine, of wealth manager Bestinvest, said the fee increases left parents facing difficult choices, with some choosing to only educate their children privately for the most important school years.
She said: 'Private education will become a luxury reserved for the ultra-wealthy, rather than aspirational professionals willing to make sacrifices elsewhere.
'More parents may choose to shorten a child's private education stint, opting for primary only, secondary only, or until their child finishes GCSEs, or even just sixth form.'
The Weatherbys study also shows how school fees can quickly rise further if the rate of inflation increases.
In a scenario where annual inflation is 5pc, the cost of sending a child to boarding school is close to £1m at £907,000, while a day pupil would cost £443,000.
Analysis by The Telegraph found private school fees will rise by more than 17pc in the upcoming academic year.
The average Year 13 day fees will jump from £21,035 to £24,600 between September 2024 and September 2025, according to an audit of fees for 228 independent schools.
Rathbones Asset Management has forecast that parents will pay an extra £77,000 over their child's school life because of VAT, rising to £96,000 if they attend a London private school where fees are higher.
For boarding school pupils it could cost parents £111,000 extra, assuming the school passes on the 20pc levy in full.