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Labour’s plans to impose a 20% VAT charge on private schools may not be enough to avert cuts to school budgets, a leading economist has said. I.
The party’s manifesto, due to be published on Thursday, includes a “Robin Hood-style” tax increase on private schools, estimated to bring in an extra 1.3-1.5 billion pounds for the struggling public sector.
Labour leader Sir Keir Starmer said the manifesto set out a “serious and practical plan for the country”.
But policy researchers I The party’s education policies are likely not enough to avoid essentially across-the-board cuts to school budgets.
“There is no money left,” said Maxwell Marlow, research director at the right-wing free-market Adam Smith Institute, and questioned where Labour would find the extra money to “maintain current standards, current per pupil funding and index it to inflation”.
He said he was “very sceptical” that Labour’s VAT policy would raise enough money to employ 6,500 teachers and put mental health counsellors in every school. The ASI report was released in March.
Luke Sibieta, chief economist at the Institute for Fiscal Studies (IFS), said if Labour wanted to deliver a “more generous settlement it would have to find cuts elsewhere”.
“Given the financial rules and the rules they’ve followed and the deficit going forward, it’s going to be difficult to allocate that much additional funding to schools,” he said.
Mr Sibieta said the Conservative manifesto published on Tuesday proposed real-terms cuts to the budget of £3.5 billion, the biggest cuts since the mid-1970s.
The Conservatives have promised to keep school funding frozen at the current per-pupil funding system, but the Department for Education (DfE) predicts that pupil numbers will fall by 400,000 over the next parliamentary term, leading to across-the-board cuts to funding.
Mr Sibieta said this would mean a cut of £3.5 billion, or 6% in real terms, in total spending on schools and could lead to school closures and staff cuts.
Asked whether Labour might have to cut the entire schools budget in the next parliamentary term to avoid a repeat incident, ASI’s Marlow said: “It is certainly a possibility.”
“It all comes down to where the money is coming from,” he added. “Unfortunately, there is no money left.”
Mr Sibieta also suggested Labour might have to make substantial budget cuts. “Given the state of the national finances, I would be surprised if there were many important commitments without additional revenue from elsewhere,” he said.
It remains to be seen how Labour will decide to “increase public spending at all levels” in its manifesto, but IFS analysts said “the fiscal rules they have agreed are highly restrictive”.
He added that given the state of the country’s finances, “it’s difficult to significantly increase funding for schools.”
Robbie Crookshanks, a school performance researcher at the Education Policy Institute (EPI), said if the new government wanted to improve the state of public schools across the country it needed to increase per pupil funding.
“Increases in school budgets in recent years have been disproportionately allocated to schools in more affluent areas, effectively reducing the value of the pupil premium,” he said.
“The government should not only consider the overall level of funding, but also how to focus that funding to address long-standing achievement gaps between low-income students and their peers, which have been significantly exacerbated over the course of the pandemic.”
Trade union leaders I Public schools are in desperate need of funds and will be unable to withstand the pressure of further budget cuts.
Daniel Kebede, general secretary of the National Education Union (NEU), said the idea that education could withstand further cuts, let alone the £3.5bn outlined in the Conservative manifesto, was “absurd”.
He said that would lead to pay cuts, a deepening recruitment and retention crisis and ultimately a loss of qualified teachers and risk of classes growing to as many as 60 students.
“What it means on the ground is that young students will have less access to qualified teachers and subject matter experts, and class sizes will continue to expand,” he argued.
“Already one million children are educated in classes with more than 31 students. Secondary school class sizes, already the largest in Europe, are set to continue to grow.”
“Making such huge cuts to education, even as birth rates are falling, would mean mass school closures and class consolidation.
“On the ground, class sizes are over 40 and approaching 60. It’s a frightening situation.”
Julia Harnden, funding expert at the Association of School and College Leaders, said many schools were already in financial difficulty and could not continue to make further cuts due to falling pupil numbers.
“At the very least, this will require increased class sizes, cuts to the curriculum and reduced pastoral support for students,” she said, adding that “this cannot be allowed to happen.”
Patrick Roach, general secretary of the teaching union NASUWT, said the cuts to the education budget were “deeply harmful” and would have a negative impact on children’s future prospects.
“There will be fewer teachers and the curriculum will be cut. This is not going to help educate our children. That’s my biggest concern,” he said.
Roach called on the new government to invest in the “fabric of our schools and colleges” and put workforce resources into “tackling the deep-rooted problems facing the system”.
The Labour party was approached for comment, but a spokesman previously said: “Labour will raise funds by scrapping tax cuts for private schools, recruit more than 6,500 new teachers and invest in delivering a great state education for every state school child.”
They added: “Private schools have been increasing tuition fees above the rate of inflation for over a decade and there is no need to pass on Labour’s proposed changes to parents.”
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