The UK independent school sector has always relied on the sacrifices of middle class families to pay for their children’s education. Unfortunately, new research seems to confirm what many parents already know, that the cost of independent education is for many, particularly those with more than one child, simply unaffordable. mtm’s research shows that fees have risen at twice the rate of inflation and the average increase in professional salaries. While mtm think this will lead to an abrupt end to the decade-long growth in the sector, their findings may be too conservative because strong growth in house prices has created a financial buffer that has allowed many parents to help pay for independent schooling.
As we have written before, the greatest limiting factor in opening new schools is limited real estate. The current instability in world markets may bring more properties within the reach of those who want to start new lower cost private schools. On the other side of the equation, any fall in house prices may cause private schooling to become even less affordable for many families.

Small to mid-sized schools with charitable status are likely to feel the greatest pressure as they have fewer financial reserves and at the same time will be expected to do more to justify their charitable status. The likely winners from all of this? Initially the for-profit companies like Alpha Plus and Cognita, but eventually the sector will have to look at how to create more affordable schooling. We suspect that given the internationalisation of education, the option for both parents and schools will be satellite campuses, some within the UK but increasingly overseas in lower cost locations like South Africa and Eastern Europe.
www.mtmconsulting.co.uk