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‘Private schools cried wolf’ over VAT fees, education secretary says

Bridget Phillipson today accuses private schools of “crying wolf” on the impact VAT on fees would have, as she rounds on critics who accuse her of rolling back education reforms.

The education secretary also hits out at union bosses threatening “irresponsible” strikes and voices her frustration at leaks over her talks with the Treasury over spending cuts.

    Phillipson can cut an isolated figure, criticised by the Tories and Blairites for failing to protect reforms that drove up school standards in recent decades. Relations with Number 10 became strained when she became embroiled in a row over freedoms for academy schools.

    Looming spending cuts that will force schools to have to find savings to fund teachers’ pay increases, likely increases to tuition fees and changes to provision for children with special educational needs and disabilities (SEND) due in June aren’t going to make the job any easier.

    But speaking to The i Paper in her office at the Department for Education, Phillpson, 41, is in a fighting mood.

    “I am a reforming education secretary,” she insists. “I’m modernising our school system for the 2030s – that’s what everything I’m doing in this department is about.

    “We’ve ended up with a school system that delivers good outcomes for some of our children, but not for all of our children, and I believe in excellence for all of our children, regardless of background.”

    She compares herself to a Labour predecessor – David Blunkett – who didn’t just “carry on” the raft of education reforms introduced earlier in the Blair administration but sought to deepen them.

    The education secretary also gives a strong hint that university tuition fees will have to rise again to keep the higher education sector afloat and admits that childcare entitlements need to be overhauled.

    First in the firing line of the Phillipson fightback are those who warned that the imposition of VAT on private school fees would see state schools overwhelmed by a flood of priced-out children. That in turn, it was warned, would mean parents sending their children to state schools missing out on their first choice.

    “I think we’ve seen a classic example of private schools and the Tories cry wolf, all the signs are that more parents than ever got their first choice school offer this year,” she says.

    Next up are the union bosses threatening strike action over pay despite large increases last year – for which Phillipson was roundly criticised by the Tories.

    “The last thing that we need, the last thing that children need is further disruption to their education, not least after everything they went through in the pandemic and the ongoing challenge that we still face in ensuring that children are regularly in school.”

    “Off the back of a 5.5 per cent pay award and additional money going into schools budgets, even in a challenging context for the public finances overall, I think it’s deeply irresponsible.”

    She acknowledges that schools are going to have to find savings even to meet the government’s preferred pay rise of 2.8 per cent.

    Phillipson is finalising her budgets for the next three years with Rachel Reeves, the chancellor. The i Paper revealed last week that some in the Treasury accused the education secretary of offering only the most politically painful cuts – a so-called ‘bleeding stumps’ strategy – like scrapping free school meals for infants.

    She says that’s “complete nonsense” but admits that another leaked option – ending state-funded provision of free period products – is being discussed although it seems that companies are being asked to foot the bill instead and will not be scrapped.

    It is her willingness to fight back against the briefers that is most interesting, however. “It’s always dispiriting,” she says of the leaks.

    “Because I’m open about the choices we face with Treasury colleagues and we have got to have that open collaboration. But the frustration is just how it was mischaracterized and has given rise to a whole set of frankly inaccurate and unfair characterization.”

    Does she think the Treasury leaked the details? “Who knows where these things come from?” she says. There are “wider paper trails” than those in the room.

    One pressing question is whether the government will announce a further increase in student tuition fees to help secure the financial future of universities.

    Officials privately admit that the decision could be made as part of the spending review.

    Phillipson does nothing to talk down the prospects of a further rise when asked if fees – unfrozen for the first time last year – will rise again this year. “I was up front last year when I made the decision for the first time in seven years to increase fees.” Pressed on whether fees might increase above inflation, she says: “We’ll look at that as part of overall higher education reform.”

    Also looming on the horizon is this September’s introduction of the new entitlements for free childcare. The nursery sector insists that it has been badly hit by the employers’ National insurance hike and there are fears the promise will turn out to be hollow without sufficient places. She admits it will be challenging but insists the pledge will be met saying early years is her “number one priority”.

    Critics have pointed out that an upper earnings limit of £100,000 on eligibility has created a tax trap that means parents earning that sum will need to earn £149,000 to compensate for the loss of the benefit.

    The education secretary admits the system needs an overhaul. “That is one example of a system that’s got lots of anomalies, and absolutely it needs to be a much more coherent system.”

    “It’s a complex piece of work, but that’s the kind of reform that we need to drive a much more coherent system. The whole system needs a total shake-up.”Does Phillipson detect – as some others do a whiff of sexism in that the three cabinet members most regularly briefed against – her, Lisa Nandy and Lucy Powell – all happen to be women? She smiles. “I think women are held to a higher standard in politics.”

    “Some of the abuse and the criticism that gets sent my way is a badge of honour. I’d be worried if they agreed.”

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    Responding to the claims they had “cried wolf” over the impact of VAT on private school fees, Julie Robinson, CEO of the Independent Schools Council said: “The VAT on fees policy has already had a very real impact on schools and families.

    “We remain concerned that there might not be the right spaces in the right places for children whose education is disrupted by this policy, especially exam students and those transferring mid academic year.

    “The full effects of this policy are yet to be seen, and we are particularly worried about how this tax on education will continue to impact families, specialist provision, and capacity in the state sector.”

    In October the Office for Budget Responsibility suggested the policy would mean 35,000 pupils would be unable to attend private schools as most of the increase would be passed on to parents.

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