LABOUR CRITICIZED FOR LACK OF DATA ON SPECIAL NEEDS STUDENTS AFFECTED BY VAT LEVY

Labour has admitted rejecting appeals to exempt children with exceptional needs from private school VAT due to worries over lost revenue, as reported during a High Court hearing.

“Labour have admitted they rejected calls to exempt children with special needs from private school VAT partly because it was ‘revenue diminishing’, judges have been told.”

WHAT IMPACT WILL THIS HAVE ON POLICY CORE REGULATIONS?

The Government claimed that exempting SEND children from the Value Added Tax (VAT) would clash with the policy’s core regulations, namely “raising additional tax revenues.” Legal representatives for Chancellor Rachel Reeves stated in court that Labour is ignorant of the possible influx of SEND kids to state schools as a result of the tax changes.

“Labour does not know how many pupils with special educational needs or disabilities (Send) will flood state schools as a result of its VAT raid on private schools, the High Court has heard.”

Jeremy Hyam KC, representing a group of private school parents, blasted this lack of attention and emphasised the doubt around the additional fees for relocated SEND pupils. “The Government did not know ‘what the additional cost of those displaced children’ would be.”

“[The] Government has provided no figure of their own on the number of displaced children,” he told the High Court.

Mr. Hyam, representing two families in the Education Not discriminating private school parent group, addressed concerns surrounding hundreds of special needs children without specialised support plans who might take over the state school system.

HOW MANY CHILDREN WOULD BE EFFECTED FROM THIS?

Barry Huggett, SEND adviser for the Independent Schools Association and Independent Schools Council (ISC), said in court papers that up to 6,500 special needs children could potentially be displaced from private schools due to the VAT policy. “As many as 6,500 such children could be forced out of private schools.”

Ministers predict that 35,000 private school students could be influenced by increased fees resulting from the VAT policy. However, the fraction of SEND students from this category remains unknown.

IS EHCP SYSTEM UNDER PRESSURE?

On Wednesday, Mr. Hyam highlighted out the challenging agreement that the EHCP system is “in complete crisis,” which means SEND students are experiencing the brunt of the tax raid’s effects. “Send pupils were being disproportionately affected by the tax raid.”

These displaced kids are likely to apply for Education, Health and Care Plans (EHCPs), which give council-funded help. However, as mentioned in Mr. Huggett’s evidence, EHCPs are extremely difficult to get because to massive system backlogs.

“The number of Send children without EHCPs that are displaced into the state sector seems to be another matter that the Government simply did not consider.”

HOW WILL POLICY IMPLEMENTATION ACHIEVE REVENUE OBJECTIVES?

Introduced in January following Labour’s election pledge, the 20 percent VAT on private school fees intends to produce annual income for investment in public services.

Sir James Eadie KC acknowledged significant meetings and the assessing of various exemptions, especially for SEND students.

“Having considered 17,502 consultation responses, the Government rejected the exemptions and the delay sought because they were incompatible with the principles underpinning the policy, namely being revenue diminishing, unfair, unworkable and/or administratively onerous.”

Estimates from the Office for Budget Responsibility (OBR) expect revenue from this measure to climb from £1.5 billion in 2025/26 to £1.7 billion yearly by 2029/30.

“He said the ‘central objectives’ in implementing the tax included ‘raising additional tax revenue annually by 2029-2030 to invest in public services, including the state education system, and enhancing the fairness of the tax system overall.’”

Legal representatives estimate that granting an exemption for SEND students would result in a revenue loss of £450 million yearly, with concerns over potential misuse by families falsely claiming SEND status.

“Ministers took the view that it would be ‘unaffordable’ for the Treasury to let SEND children off paying the tax.”

Expert witness Barry Huggett suggested that the displacements of up to 6,500 SEND students from private schools was not thoroughly considered, potentially leaving subjected children at a disadvantage. “The effect of pricing out such vulnerable children appears to be something ministers ‘simply did not consider.’”

SEND PUPILS AND THE VAT CONFLICT

The Government is facing legal action over the introduction of 20 percent VAT on private school fees, with claimants saying that the policy biases and violates upon some pupils’ human rights.

“The Government is being sued over its decision to apply 20 per cent VAT on private school fees, with claimants arguing that the move is discriminatory and breaches some pupils’ human rights.”

In the time frame of April 1 and 3, three High Court challenges are being heard together, involving over a dozen family case studies. The cases include families with SEND children, a subjected girl at a single-sex school, Jewish and Muslim minority households, and foreign nationals in a bilingual education.

“They include multiple Send children, a vulnerable girl in a single-sex school, minority Jewish and Muslim families, and foreign nationals in bilingual schools.”

FAMILIES FORCED TO SEEK FOR PRIVATE OPTIONS

Mr. Hyam, a lawyer representing two families in the case, highlighted scenarios where SEND children were shifted to private schools after state systems failed to satisfy their needs.

One family even employed their disability living allowance to finance their son’s tuition.

“The barrister said one boy with autism was now thriving at his private school but his ‘parents are not able to afford the increase in fees’ and ‘will be forced to … return to a state primary school of the sort which was unable to meet his educational needs.’”

During court proceedings, Mr. Hyam underlined that many SEND kids end up in private schools due to the public system’s disability to provide necessary support. This sometimes results from difficulty in getting Education, Health, and Care Plans (EHCPs), which are vital yet difficult to be protected.

“Addressing the High Court, he claimed that many Send children ended up in private schools because they had been unable to obtain an EHCP and had effectively been ‘failed’ by the state system.”

WHAT ARE THE STATS OF SEND PUPILS?

According to the Independent Schools Council (ISC) 2024 census, over 100,000 SEND kids are enrolled in private schools, with fewer than 7,650 obtaining an EHCP. “More over 100,000 pupils with Send are enrolled at private schools, according to the ISC’s latest census in 2024. Just under 7,650 of those have an EHCP.”

WHO IS MR HUGGETT AND WHAT IS HIS ROLE FOE SEND PUPILS?

Mr. Huggett has a remarkable career as the chair of the Independent Schools Council’s (ISC) SEND advisory committee and the senior adviser for SEND to the Independent Schools Association (ISA). In 2014, the former head teacher received an OBE in recognition of his contributions to the field of SEND education.

In his court statements, Mr. Huggett highlighted government projections showing that 35,000 kids could be displaced by the VAT policy, with a part of this number expected to include SEND children.

“His calculation is based on the fact that the Government’s own estimate suggests 35,000 pupils overall could be displaced, with a proportion of these expected to have SEND.”

ISSUES RAISED DURING COURT HEARINGS

Barrister Families in the lawsuit were represented by Mr. Hyam, who charged that the government was ignoring important issues.

He continued: “There is a real problem and the Government knew about it.” According to government data, he further stated, “6,500 [SEND children] who presumably can’t afford it any more will be displaced.”

Mr. Hyam stated that relocating vulnerable children from homes that satisfy their needs to ones that do not, without adequate reasons, is unfair.

He highlighted that most SEND families chose private schools out of necessity, not luxury, because their children’s requirements are unmet in the state sector. “It is not fair because those children have been failed by the mainstream system.”

FINANCIAL BURDEN ON FAMILIES

One claimant family, reliant on disability living allowance to pay for their autistic child’s private school costs, will be forced to withdraw their child due to the VAT increase.

Although Labour proposed an exemption for SEND children with an EHCP, only a small minority of families can get such plans.

“Only a small proportion are able to get an EHCP, leaving the vast majority of SEND families having to pay the tax.”

The Office for Budget Responsibility (OBR) predicted that the plan might result in 35,000 fewer pupils in private schools, while the government criticised the figure of 6,500 displaced pupils with special needs as “a flawed assumption” without providing an alternative estimate.

Families have challenged the tax in the High Court on the basis that it breaches children’s access to education under the European Convention of Human Rights. Claimants also contend that the regulation discriminates based on SEND needs, religious views, or the necessity for a single-sex educational environment.

SPECIFIC CASES HIGHLIGHTING DISCRIMINATION

Among the claimants are Jewish pupils in private religious schools who fear anti-Semitic attacks in the state sector, as well as a girl who relocated to a single-sex private school owing to “harassment by boys at her co-educational state school.”

Christian families seeking religious education not offered in the state system have also joined the struggle. Stephen White, a claimant who publicly identified himself, has four children at Bradford Christian School and led a protest at the High Court’s opening day, supported by other concerned parents.

A government spokesman stated: “We do not comment on ongoing litigation.”

MINISTERS CLAIM EXEMPTIONS ARE ‘UNWORKABLE’

Mr. Hyam emphasised that it is wrong to characterise SEND children’s enrollment in private schools as driven by income, highlighting instead that such decisions stem from necessity.

“It is wrong as a matter of approach to consider that the fact that these Send children are in private education is a consequence of wealth rather than a consequence of desperation,” he remarked.

The The Treasury Department, supported by HIGH-COMMISSIONER(HM) Revenue and Customs and the Department for Education, is defending the VAT policy against legal allegations.

In court submissions, Sir James Eadie KC indicated that “thorough consideration” was given to the plight of SEND children. However, demands for exemptions were rebuffed as being “revenue-diminishing, unfair, unworkable and/or administratively onerous.”

DEFENSE OF THE POLICY

The Government’s defence, which began on Wednesday, maintains that the VAT levy serves as a valid mechanism to raise revenue for state schools.

The judicial review, presided over by Dame Victoria Sharp, Lord Justice Newey, and Mr. Justice Chamberlain, is due to end on Thursday, with the judges anticipated to make a single verdict at a later date.