There are some political battles that are more about symbolism than the practicalities. The proposed Labour policy to put VAT on private school fees is one of them. In fiscal terms, the money involved is relatively small, raising an estimated £1.7bn at best. But it is a row that plays to both parties’ optics.
For Keir Starmer, it is an obvious way to differentiate his party from the Conservatives and to attack entrenched, generational privilege. Rishi Sunak’s riposte is to defend personal choice and the “hard-working aspirations of millions” – and to ultimately protect his voters from a tax hit. He should, however, be careful that the constituency he courts genuinely exists.
As an Old Wykehamist, Sunak may think he knows the sorts of parents whose children go to private schools well – but things have changed since his day. The elite schools were always expensive, but since the Prime Minister left in the late Nineties, fees have more than doubled in real terms. The same period has seen house prices rise at an even greater rate while wages have stalled for around a decade.
For the Tories, this means a worrying squeeze on upper middle-class comforts and leaves the party out of touch with its potential voters.
Through the Eighties and Nineties, the top private schools were still within the aspirational reach of the professional classes. Doctors, accountants or even back-bench MPs could meet the fees out of their income, even if it did mean a bit of cutting back on other luxuries. Now, that is no longer the case. The comfortably off have been priced out of schools in favour of the internationally wealthy. At the leading London day school St Paul’s, the cut-off for financial assistance is a household income of £120,000. Private schools are increasingly moving from the preserve of the top 5 per cent to the top 0.5 per cent.
The reasons for this change are complex, but in a large part it has been driven by increased overseas demand. Successive waves have seen the wealthy of Russia, the Middle East, China and Africa want prestigious English educations for their children, while schools have been reluctant to expand provision (though some now operate overseas outposts). Attracting the world’s wealthy has a cyclical effect: boarding schools especially have become more luxurious, where once cold showers and hard beds sufficed for the English upper classes, and therefore expensive.
At the same time, the alternative has become more tempting for better-off parents. State schools have undergone a significant improvement, especially in major cities. The rise of academies and free schools has also offered more choice to parents. Outside of the most famous institutions, many private schools are academically pretty middling, and so good state schools in affluent areas can compete with them.
Over the past decade or so, numerous private schools have chosen to become state-funded academies as their pupil numbers declined. One exception to this trend is perhaps the growing number of small, relatively inexpensive, non-Christian religious private schools – but this is unlikely to be what Sunak has in mind when he defends the lack of VAT on fees.
The result is that the politics of private schools are very different from a generation ago. There’s a reason the former education secretary Michael Gove proposed putting VAT on school fees from the backbenches in 2017. The sort of affluent parents who once stretched to afford private schools are now worried about housing costs and stagnating wages. The 20 per cent increase of adding VAT to the costs doesn’t bother them, because such schools have already moved out of reach, and the alternatives are just as attractive. The group of people who think they might have the money to privately educate their children is just smaller than it was, and fewer feel the need to defend them. Indeed, only 10 per cent of voters think the schools should keep their charitable status (a different policy to the VAT one, but often intertwined in reporting).
David Cameron’s education reforms grasped that there was a more important group of voters for the Tories than private school parents. Those who could no longer afford the rising fees wanted an element of school choice and for those options to be good. They liked the idea of academies outside of local authority control that offered some of the variety of the private sector and hit similar results, but without the price tag. Sunak and the Tory press that has been hammering Labour over its policy in recent days seem to miss this.
To stand a chance in the next election, the Prime Minister must convince moderate and casual Tories that they should fear a Labour government. This means persuading those that earn more than average but don’t have vast wealth built up that they will bear the brunt of Labour economic policies. This only works if you understand what really matters to them. It may come as a shock to those educated in the Nineties and before, but this is more likely to be state school quality than private school affordability. To win an election, you need to know which gallery you are playing to, especially if the subject matter is more widely unpopular. In backing private school parents, Sunak is missing this.