Bridget Phillipson faces strain to scrap VAT raid on non-public college charges as Labour MP requires U-turn
Labour has been urged by one of its own MPs to reverse its tax raid on private schools once economic growth improves.
Dr Rupa Huq, the MP for Ealing Central and Acton, said putting 20 per cent VAT on independent school fees was punishing ‘working people’.
She acknowledged the party had said it was a ‘tough, but necessary decision’ but also pointed to its plan to grow the economy.
Urging the Government to help prevent smaller institutions ‘falling into this trap’, Dr Huq called for VAT to be made relative to the school’s turnover rather than imposed as a blanket charge.
She told the Commons: ‘Could there be when this growth comes… a way of undoing it or something? What I would suggest is possibly doing it on a turnover basis – so for your enormous schools that can afford it, yes – but for the smaller ones who have been caught in this trap, no.’
The backbencher, who went to a private school herself, said not all schools were as wealthy as Eton and ‘some of these comms are based on a caricature.’
She said smaller schools were suffering from the policy, especially those catering to children with special educational needs and disabilities.
While insisting she would ‘never’ send her children to an independent school, she acknowledged parents who make ‘enormous sacrifices’ to pay for private education, saying they should not be ‘demonised’.
Education Secretary Bridget Phillipson. Labour ministers have been urged to reconsider their tax raid on private school fees
Labour MP Dr Rupa Huq said parents who make ‘enormous sacrifices’ shouldn’t be demonised and suggested VAT should be applied relative to a school’s turnover rather than as a blanket fee
The MP further suggested ministers had not struck the right rhetoric with the policy, which she added had hit many smaller institutions including faith schools and specialist schools for SEND children.
She said: ‘I’ve heard this on the doorstep, you know ‘we have the worst car, we never go on holiday’, that was me in the 80s.
‘These are people who consider themselves working people, so again, the strap line of the Labour manifesto was no taxes on working people. So I think we should be careful with our rhetoric sometimes.’
The new VAT rules would also have the ‘unintended consequence’ of leaving wealthier schools and colleges ‘quids in’ after being able to claim back money from the Treasury on capital expenditure such as new buildings and equipment, Dr Huq said.
The MP continued: ‘These elitist private schools, Eton, they’ve actually done quite well out of this, because they can cash in on windfalls from these new VAT rules.
‘My worry is it will just make an elitist system more elitist.’
Conservative MP Jack Rankin, whose Windsor constituency includes Eton, said some of Dr Huq’s comments about the £63,000-a-year public school were ‘unfair’, adding that it does ‘a lot in my community’.
Damian Hinds, a former Tory cabinet minister, commented that ‘there is probably plenty of VAT to be had from the parents of boys at Eton’ but the Government has ‘ignored’ the concerns of low-fee faith schools or schools for children with special educational needs and disabilities.
He was met with a rebuttal from Rachel Gilmour, the Liberal Democrat MP for Tiverton and Minehead, who said she worked three jobs as a single parent to send her two children to Eton.
MPs suggested that comments about Eton (pictured) were ‘unfair’ and that ministers needed to be more careful with the rhetoric used around the policy
‘When (Mr Hinds) said there’s more money from the old Etonian parents, there certainly aren’t, not from this one.’
She added: ‘Eton hands out 100 boys plus a year completely free fees, they don’t even have to pay for their pencils.’
Responding for the Government, Treasury minister Torsten Bell said that arguments for exempting faith schools from the tax were ‘not compelling’, saying it would reduce revenue which could be spent on pupils in the state sector.
But he insisted Labour was not trying to ‘judge other parents choices’.
He said: ‘The best education for children is also what motivates the Government to break down barriers to opportunity, ensuring every child has access to high-quality education.
‘Every child includes the 94 per cent of children that attend state schools. The reforms we debate today, to VAT and business rates, will raise around £1.8 billion a year.’
