Two prep schools that have been forced to close have blamed Labour’s VAT raid for the decision.
Avon House School in Essex and Sompting Abbotts in West Sussex will not reopen in September, and are claiming that the introduction of VAT on school fees has contributed to the financial problems they are facing.
The two schools, which are the latest to fall victim to a “triple whammy” of tax raids, said that rising operational costs and falling pupil numbers had left them with no option but to close.
Schools are also absorbing higher employer National Insurance contributions and the loss of business rates relief.
The closure of the two prep schools, which teach students aged between three and 11, has left parents struggling to find places for their children elsewhere.
In a letter to parents, Amanda Campbell, the headteacher of Avon House, said that the decision to close had followed “a prolonged period of financial challenge”.
She wrote: “Like many independent schools across the UK, Avon House School has faced increasing operating costs, declining pupil numbers and the additional financial pressures arising from the introduction of VAT on independent school fees.
“Despite every effort to secure a sustainable future for the schools, including exploring opportunities for investment, merger and sale, it has not been possible to find a financially viable way forward.”
In a similar statement, David Sinclair, the principal of Sompting Abbotts Preparatory School in Lancing, said: “It is with immense sadness that we announce the closure of our wonderful school, which was founded in 1921.
“We have explored numerous options to keep the school open in September, but financial pressures have become too great, including the introduction of VAT on school fees and the general economic climate.
“We know that we have provided our pupils with an excellent rounded education over many years, and we wish our pupils the very best in the future.”
Writing to parents, Mr Sinclair said: “The declining roll has exacerbated the already challenging times that we have been experiencing – the VAT on fees, increased living wage and national insurance contributions, significant pension contributions and reduced birth rate always affects us. The predicted roll in September is so low, we cannot contemplate continuing to trade and we have been forced into administration.
“I can assure you that we have explored every option in order to keep the school open. Unfortunately, we have been unable to secure a merger or acquisition.
“Needless to say, we will assist you as much as we can for your child or children’s transition to an alternative school. I am extremely grateful to you, the very loyal parents, who have supported us through a turbulent term, and I wish you and your families every success in the future.”
‘Heartbreaking situation’
The announcements prompted shock and anger among parents, teachers and former pupils of the schools.
Annette Williamson, the director of music at Sompting Abbotts, told The Telegraph: “I have taught music in this magnificent school for 43 years. It has been a heartbreaking situation to close the school, and we have been inundated with messages of support from all our loyal pupils, parents, past and present, including well-known alumni such as the author Alex Preston.
“For all of our staff and children, it was not like a school but seemed to us as if time had stood still – an idyllic oasis in a fast-paced world, where children could be themselves, with play forming the backdrop of their everyday lives.
“Added to this a dedicated and loyal staff from nursery through to Year 8, where many children completed their education here, often gaining scholarships to major public schools, but equally providing a springboard for those taking other directions such as forming rock bands – one of our past pupils was a member of ‘Ordinary Boys’.”
Ms Williamson added: “Our leitmotif was ‘happiness’. The happy faces which can be seen on our website reflect the very essence of our wonderful pupils.
“Our parents are devastated with the closure and are struggling to find similar alternatives at very short notice for their children before the start of next term. It is the end of an era of a unique prep school, and will forever be etched in the memory of all who spent part of their childhood here.”
‘Triple whammy of additional taxes’
The latest private school closures follow an analysis by The Telegraph that revealed that school fees would increase by 4.5 per cent from September. The above-inflation rise comes after a 17 per cent jump in average fees last year, following Labour’s decision to remove the 20 per cent VAT exemption for independent school fees.
Julie Robinson, the chief executive of the Independent Schools Council (ISC), said: “Schools are doing all they can to keep fees as low as possible for parents, including a record amount of support being given by independent schools – one in three children at an ISC school receives some form of fee assistance.
“However, it is undeniable that independent schools are facing incredibly difficult financial headwinds.
“Over the past two years, there has been a triple whammy of additional taxes – with VAT being placed on school fees, charitable schools losing business rates relief, and the rise in National Insurance employer contributions – set against a backdrop of rising prices and falling pupil numbers.”
Despite the significant increase in fees, Lucy Powell, the Education Secretary, has previously supported the idea that tax raids should go further.
Ms Powell said in 2019 that private schools should lose their charitable status, which would hit them with taxes worth £3bn.