Changes impacting on income
Private schools facing tough decisions over costs
John Edward: ‘we have a lot to deal with’ (pic: Terry Murden)
Independent Schools have been warned that they may have to take some tough decisions to tackle legislative changes that are putting a squeeze on their income.
The sector is facing a series of cost pressures which will test the resilience of schools’ balance sheets, a conference heard. Already some are considering mergers and cutbacks in senior staff, while fees are also expected to rise.
John Edward, director of the Scottish Council of Independent Schools, told a gathering of teaching professionals in Edinburgh that there have always been closures and cutbacks, and pupil numbers have remained broadly the same over a number of years. However, he said the outlook is changing.
“To the outside world we look like a static and stable sector,” he said. “But we have a lot to deal with in terms of legislation. It will increase as more powers are gained by the Scottish parliament.”
He said schools are facing the removal of business rates relief – “the big one” – together with higher contributions to the Teachers’ Pension Scheme and the challenge of matching a recently agreed hike in salaries paid to teachers in the state sector.
The conference held at The Scotsman Hotel and organised by Navigator Law, the biggest firm of legal advisers to the independent schools sector, heard that schools will have to decide whether or not they should opt out of existing pensions schemes in light of a hike in employer contributions from 16.4% to 23.6%.
There is also pressure to raise salaries after the Scottish government agreed a 13.51% increase to state sector teachers over three years.
Mr Edward said the axing of rates relief, recommended by the Barclay review, was “pre-loaded” given the media campaign that led up to it.
He said there were knock-on effects of the cutback in income and being forced to pay the full amount of business rates.
“Community activities you undertake will be affected. You may have to tell clubs that use your facilities that you will have to charge the full commercial rate. This is bringing into sharp relief the cost of educating our children.”