Sky-high school fees force parents to dig into pensions and savings

The recent government crackdown on school fees, which introduced a VAT charge, has led to a surge in private school costs that are forcing many parents to deplete their savings and pension funds, according to a new study by Rathbones. The research reveals that nearly one in four families with children in private education have tapped into their Individual Savings Accounts (Isa) or long-term investments to cover the increased fees.

Moreover, one in five have cut back on their pension contributions to make ends meet. This financial strain has resulted in many parents having to economize in other areas, such as cutting holiday plans and postponing improvements.

Amanda Cook, Rathbones' financial planning director, emphasized that the true cost of private education extends beyond the school fees themselves. The VAT implementation has created a "double squeeze" for families, as they must balance their financial security with the rising costs of private education. In response to the hike, several schools, including prestigious institutions like Eton College and Tonbridge School, have seen significant fee increases, with some now charging over £60,000 annually - more than 50% above the UK's median salary.

This has led to a decline in enrollment, with over 30,000 pupils leaving private schools, accounting for more than seven percent of the total private school population. As a consequence, some schools have closed their doors, including historic institutions like Longacre School and Thetford Grammar, which have roots dating back more than seven centuries.

Cook noted that while many families are absorbing the additional costs, a significant number are doing so at the expense of their financial stability and have either delayed enrollment or altered their schooling plans.