A second school has confirmed it will close after an “unexpected” rise in VAT on school fees left it unable to continue operating. Maidwell Hall, which is on the Leicestershire border, has hit out at the “unrelenting” economic pressures it is facing.
The school, which is part of the Uppingham Group of Schools, has said the Government’s introduction of VAT on school fees in the Autumn Budget is one of the reasons why it can no longer operate. It is the second school to confirm its closure in a matter of days after Amherst School in Loughborough announced it would be closing due to financial challenges compounded by the Budget.
Barbara Matthews, Chair of Trustees at the school, confirmed the closure was in part due to the Government’s moves which have seen the elimination of business rates relief and an “unexpected increase” in National Insurance. She said the trend towards parents choosing to send their children to school as day pupils rather than boarders had also forced the Trustees to “recognise that the economic consequence was unavoidable”.
READ MORE: Leicestershire school announces ‘out of the blue’ closure
The school, in Maidwell, near Market Harborough, currently has 160 pupils aged 4–13 on its register. Harborough MP and shadow education minister Neil O’Brien expressed concern over the closure, referring to the Government measures as a “perfect storm.”
He said despite “repeated warnings that independent schools would close”, the Government introduced VAT on school fees. He added schools have also had to contend with the elimination of business rates relief and the increase in employer National Insurance contributions.
In its announcement, the school said it intends to close at the end of 2025’s summer term 2025. Maidwell Hall was now entering a period of statutory consultation on the planned closure with staff – the findings of which are by spring at the latest.
Trustees said the announcement “had been made early, at the start of the spring term, to allow the pupils and their families, as well as the staff to plan for the future”. Ms Matthews expressed her “deep sorrow” at the decision to close.
She apologised to the “very many people who will be affected and for whom Maidwell Hall holds a special place in their lives”. Ms Matthews also felt especially for the pupils, adding the school is blessed with “wonderfully gifted and well-rounded young people and the delight they take in school has made this decision doubly difficult”
News of the school’s closure comes just three years after Maidwell Hall faced almost certain insolvency, but it was rescued by a merger with Uppingham School, which repaid the six-figure bank loan for which the bank was seeking repayment. Ms Matthews said: “Since the merger, Uppingham has invested in the school, financially and educationally to improve the teaching environment, the buildings and the systems.
“Despite the very many positives, including an impressive improvement in the school under the new leadership team, the negative macro-economic forces have become unrelenting. Within the independent sector, post-Covid, there has been a marked trend towards parents choosing to send their children to school as day pupils rather than boarders which has reduced the income per child and thus increased the number of pupils necessary for the school to break even.
“Further blows came in the Budget last November when the announcement of VAT on school fees and the elimination of business rates relief was confirmed, and the unexpected increase in National Insurance was announced. This forced the Trustees to recognise that the economic consequence was unavoidable – the school would need to close.”
News of the school’s closure comes just three years after Maidwell Hall faced almost certain insolvency, but it was rescued by a merger with Uppingham School
(Image: Getty)
Ms Matthews revealed that the school would need 250 fee-paying pupils to break even. It had 160 as of the end of 2024. She said with inflation, soaring energy costs and interest on loans this number would only increase even further.
She said: “The impact on the pupils, their families and the staff has been a major consideration and has made the decision much harder. Sadly though, the school must live within its economic means and despite its best efforts, the external factors that the school, and the wider independent sector face, have proven too strong.
“Maidwell Hall will continue to be led by Anthony Rendall, until its proposed closure in July 2025, to ensure that there is continuity of the educational provision at the school. The proposal to close Maidwell was made only after extensive consideration of other possibilities but there really was no evident solution to stemming the continuing financial losses and the need to increase from 160 to 250 fee-paying pupils.”
From Tuesday, April 1, private schools that are charities are expected to no longer be eligible to receive business rates charitable relief, while changes to VAT came into effect on Wednesday, January 1. The Ministry of Housing, Community and Local Government previously acknowledged the changes “could impact on the viability of certain private schools and, in some cases, contribute towards school closures”.
Neil O’Brien has criticised the Government’s decisions
However, Harborough MP Neil O’Brien believed the loss of Maidwell Hall was “so unnecessary”. He said: “Uprooting a child from their school and moving them to another is always very unsettling and disruptive, especially at such a critical point in their education.
“All of this seems so unnecessary. The Government did not have to do this, and despite repeated warnings that independent schools would close, they introduced VAT on school fees. Not only that, but schools have also had to contend with the elimination of business rates relief and the increase in employer National Insurance contributions. It’s a perfect storm, inflicted on them by the Government.
“This policy will result in many more children entering state education when there are already immense pressures on local school places. It’s a disastrous policy, creating uncertainty and unnecessary disruption for families and teachers here and across the country.”
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