
VAT on Private School Fees
The Naval Families Federation formally responds to the Government’s announcement regarding VAT on Private School Fees and the impact on Royal Navy and Royal Marines families
On 29th July 2024, the Chancellor of the Exchequer announced that the Government intended to apply VAT to Private School Fees and remove the Business Rates Charitable Rates Relief for Private Schools. The NFF recognised the potential impact that this could have on many of our Royal Navy (RN) and Royal Marines (RM) families, and together with colleagues in the Army and RAF Families Federations, took the opportunity to invite those who will be personally affected to share their views with us. This allowed us to present current and relevant evidence to those responsible for implementing these planned changes, so that they have a better understanding of how this will affect those within the Armed Forces.
We would like to thank those families who contacted us to share their concerns about the impact that this policy change could have on their children and their ongoing education. Families reported being unaware of the specific details regarding this new policy, primarily due to the lack of communications from their schools, HM Treasury and the MoD, and this added to their frustrations and anxiety. We referred to anonymised comments from families within our report, as we wanted to highlight the stark reality of what the introduction of the VAT payments will mean to serving families.
We collated the feedback that we received from families during August/September 2024 to form the basis of our report and in addition to this, we also highlighted relevant evidence from the 2024 Armed Forces Continuous Attitude Survey and Families Continuous Attitude Survey Reports. This helped to emphasise how important it is for RN/RM families to have access to financial support that can offer a degree of stability for their children’s education.
Some of the key findings from the feedback that we reported on include:
All of the parents who contacted us who have children in private schools told us that they are already struggling financially. There is a genuine fear that their children may have to be withdrawn from their chosen schools if the full cost of the VAT is implemented with effect from January 2025, or families may incur huge debts as a result.
Parents face having to move their children to different schools during the 2024-2025 academic year and this could have a huge negative impact, especially on those in key stages of their education.
34% of the families who have contacted us over the summer have made it clear that they are considering whether they will remain in the Armed Forces, if these changes are implemented without any due consideration for the unique circumstances of Service life. Serving personnel view this impending change to be another erosion of their ‘offer’ and this could potentially have a negative impact on recruitment and retention, at a time when the Armed Forces are already struggling to retain personnel.
37% of the families that have contacted the NFF in response to the recent announcements are self-funding their children’s education in private schools. Some families have taken this decision because they are not eligible for CEA, whilst others have opted not to pursue CEA, because of the associated strict criteria, in particular pertaining to the mobility of the non-serving spouse.
50% of those families who are self-funding their private school fees have chosen to do so because their child has Special Educational Needs and Disabilities (SEND) or mental health conditions and their specific needs could not be supported within the state education system.
Since the initial Government announcement was made during the school holidays, with very little detail, many RN and RM families have been left to worry about how they will manage in the interim, with no information available to them about what financial support might be forthcoming, or even what the increased fees might be. Parents are having to make uninformed decisions about the future of their children’s education because many have calculated that they simply cannot afford to pay a 20% increase in fees, which is potentially thousands of pounds each year, to keep their children in their current schools.
We are aware that a reference was made to Service families in the original documents published by HM Treasury but it appeared that a decision would not be made until after the Spending Review.
We have therefore requested that HM Treasury and the Ministry of Defence conduct a prompt and thorough review of the current financial package of support for Service children’s education, so that an early announcement can be made to aid informed decision making.
As soon as we receive further information on this issue, please be assured we will share it with you.