What does a Labour win mean for the education sector?

A sign that says General Election 2024, with House of Commons in the background

By Conrad Emmett | 5th July 2024 | 6 min read

Labour has won the election, and it has done so by a significant majority.

As always, education played a central role as the parties shaped their manifestos and campaigned to win over the electorate.

So, what did Labour pledge, and how will this affect schools and trusts?

Policies on VAT, teacher numbers and nurseries

In its manifesto, Labour outlined several key policies for the education sector.

One of these frequently hit the headlines – ending VAT exemption for public school fees.

Labour says an end to this exemption will mean more funding for the state sector.

Meanwhile, Labour has also said it will increase teacher numbers by 6,500 in what it describes as ‘key subjects’ – and add about 3,000 school-based nurseries.

Potential effects of the VAT change for fee-paying and state schools

It’s hard to say what effect the VAT change for private school fees will have, simply because it is too early to get the full picture.

The change will not be brought in this year. However, affected schools will have to prepare, even if they hope there’s a difference between the manifesto pledge and its real-world implementation.

The big question for these schools is whether they pass this extra cost to parents or find ways to save money and absorb its effect. Perhaps the solution will involve a bit of both.

And others might ask what the result will be for the state sector. Do they need to prepare for children moving from fee-paying to state schools as the cost of private education increases?

A new challenge (and an ongoing challenge)

Labour’s promise to add new teachers to schools is one most people will welcome. But with it comes a challenge.

Right now, schools are already struggling to recruit and retain staff.

Even if the new UK Government does a lot to support recruitment – with a nationwide advertising campaign, for example – many back-office staff and other school leaders will feel the challenge before them.

Meanwhile, many trusts will now be thinking about the logistics of incorporating the new nurseries proposed by Labour. The need to manage resources and spend wisely will be front of mind.

A call for careful consideration

Commenting on the result of the General Election, Simon Freeman, Managing Director for Education at IRIS Software Group, said: “The 20% VAT charge will represent a major change for independent schools and parents, prompting headteachers across the country to reassess their fee structures and operations.

“We encourage the new government to carefully consider the impact on both independent schools and the state sector. Many areas of the UK have limited capacity for additional state-educated students, and the cost of an influx of new pupils from independent schools could offset the increase in VAT receipts.

“However, we also see this policy change as a catalyst for both independent and state schools to identify efficiency savings and speed up their digital transformation. This might include mitigating fee rises by creating new operational efficiencies, such as renting out sport facilities to the local community -- or seeking greater oversight of their finances to keep expenditure as lean as possible.

“The new pledge to bolster UK teacher numbers by 6,500 is a promising step forward. To make this effective, it should be supported by a comprehensive programme to encourage new graduates into teaching, and that will take time to produce results. In the meantime, solutions that ease the administrative burden on teachers will go a long way to supporting excellent continued professional development while capitalising on opportunities for career progression afforded by the trust system. Embracing these opportunities will allow educators to adapt, innovate and continue providing high-quality education under the new government.”

What can help you?

Effective financial management

If you are tracking and reporting VAT – or any other financial complexities that affect schools – you need something much more than a spreadsheet. You need a joined-up system.

One that can handle payments and produce reports easily.

Ideally, this system also needs to intelligently track things like procurement and infrastructure, ensuring every pound is spent the right way at the right time.

All this is important if you are expanding your school to add new functionality, like nurseries, adding staff or handling an increased student intake.

Supporting teacher development

With the UK Government hoping MATs and schools can recruit more staff, you will need to succeed on two fronts.

The first is to attract staff through powerful, robust campaigns. You’ll need to be able to beat your rivals to the best candidates, and you’ll want to reach out to them wherever they are – whether they are actively looking for a job or not.

The second is to fine-tune retention strategies. Every staff member who leaves is, of course, an addition to a potentially growing recruitment target.

Good recruitment software and HR systems that back training and growth, then, are a must.

Supporting expansion

What if your trust is one that will be adding a new nursery to meet the Labour Government’s promise? You might need to manage new capital projects as you add physical infrastructure to support this.

Furthermore, schools and trusts will want to secure funding to make this happen and will need systems that document how the money will be spent. After ground is broken, you will then need to track and evidence that spending.

And how do you best deploy any of the pledged additional teachers to best meet the needs of your students?

Anything that increases the size of your trust needs to be supported by logistical insight and data. That means a powerful, integrated MIS, and also software that will take information from across your trust and help you to make meaningful decisions quickly.

Free guides that can help

Over the years, IRIS has developed a series of guides that can help you with staffing and finance.

Top tips for attracting quality candidates for the new school year

This guide is for schools that want to recruit staff now. Read essential tips that will give you an edge in an incredibly competitive climate.

Get it FREE here

A guide to workforce management for schools and trusts

You want staff to feel so happy they never want to leave. How do you do this? Find out in our guide to creating a strong, nurturing environment for staff.

Get it free here

Controlling financial chaos

The financial challenges schools and trusts face are constant and always changing. So, how do you confidently manage staff pay, handle funding uncertainties, and schedule other essentials, like repairs? This guide explains how.