Tag Archives: taxes

SEND, fuel duty and the Apprenticeship Levy  

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SEND was identified as one of their 3 top priorities by 60% of a random sample of 100 delegates at the recent Lib Dem Conference. 45% ranked it first and 15% second, often behind funding in general.

This result isn’t a surprise to anyone in education, although falling rolls doesn’t yet seem to have worked its way up the political agenda to be a top priority for councillors and activists. I am sure that will change.

Anyway, as regular readers know, before the summer break I expressed concerns about the SEND deficit many local authorities are facing, only to have the end date for the ‘statutory override’ kicked down the road from March 2026 to March 2028 two days after my blog appeared. I m sure there is no link between the two, just great timing on my part.

So, what might local authorities do. Two suggestions, one possible and one for consideration. Local authorities need to check that they are spending all the Apprenticeship Levy raise by them in its present form. They should not be returning any unspent cash, raised from maintained schools to HM Treasury. Apprenticeships across the SEND landscape can be a good investment, and certainly a better use of the cash than sending it back to Westminster. Hopefully, all local authorities are now making full use of the Levy cash collected.

My second suggestion needs some work. At present, SEND transport is a massive cost to many local authorities. The recent NI hike won’t have helped, and should be recognised in the funding for the High Needs Block. If not, it is a tax on SEND, and indeed education as a whole.

The other tax is Fuel Duty. Unlike VAT, I don’t think it is recoverable by local authorities, despite making up around 50% of the price of fuel at the pump. Assume a taxi does two journeys a day for 190 days a year, and uses a litre of diesel for each journey with a SEND young person. That’s around 380 litres a year. As 400 is an easier number to use, let’s round it up to that number. To compensate, let’s say diesel is £1.30 per litre. This puts the fuel cost at £520 per taxi per year. Ten taxis, £5,200; 100 taxis: £52,000. Now assume 50% fuel duty and the possible saving mount up.

Agriculture has long had a red diesel scheme to cut fuel costs.  Education should not be paying income from the High Needs block back to HM Treasury in tax. Like business rates, a fuel rebate scheme should be in place where local authorities certify fuel purchased, and receive a rebate of the duty.

However, this might incentivise the use of fuel-inefficient vehicles, so the scheme should be predicated on a growing percentage of vehicles being electric, and thus not requiring the rebate. Vehicles could also be required to be less than five years old, and with a minimum miles per litre outcome.

Such a scheme won’t solve the problem, but every little helps, and it might encourage the use of electric taxis that are both cleaner for the environment and, until the government changes the rules, less costly in tax paid by local authorities.

Serendipity Part 2

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I mentioned in my previous post that yesterday I had been reading a random volume of the TES in a library and had found comments about special needs and the transfer of funding to schools after the 1988 Education Reform Act. I am grateful to the Chief Finance Officer at a leading MAT who straightaway sent me an article about funding of schools in Edmonton, Alberta in 1990. Thanks for the article, and for reading my blog.

In the same volume of the TES, I also discovered, again quite by accident, an article I had written and sent to the TES. I think it was my earliest contribution to the TES, and one I had completely forgotten about.

I have reproduced it here so I once again have it my collection, and also because of the up-coming budget in November that might be one for growth rather than business, and if so,  might the Chancellor risk overlooking any consequences for teachers and other public sector workers in any dash for growth?

Bad business for teaching

Chancellor Lamont’s budget for business is bad news for teachers. Like many public sector workers they will be reflecting that the new share option schemes and the 6p off the basic rate of tax which can now be earned through profit-related pay schemes will benefit their friends in the private sector without offering any incentives to them. However, if these changes help to bring down the level of basic pay settlements in the private sector then they will directly affect the level at which next year’s pay settlement for teachers is fixed; teachers could find themselves losers all round.

As consumers of large amounts of in-service training, teachers might have expected to benefit from the new tax relief on vocational training. But the present proposals only refer to national vocational qualification awards and will be of no use to the many teachers who currently pay for their own studies. This will particularly affect married women seeking to return to teaching who often need to finance further studies before they can regain a teaching post. This clause needs urgent consideration during the passage of the Finance Bill to ensure teachers are not seriously disadvantaged as an occupational group.

Finally, the increase in petrol duty and the associated rise in VAT may well have serious consequences for the already fragile labour market for teachers. Many schools are some distance from public transport, in housing estates or rural villages with only one bus a week. The increase in petrol prices may make it more difficult to attract teachers to work in these schools.

If Kenneth Clarke [then SoS for Education] saw the drift of the budget proposals before last week’s Cabinet meeting then he must accept responsibility for their effect on the teaching profession. Undoubtedly, however, our archaic system of placing the Chancellor on ice for a period before he delivers his budget has probably meant that in their enthusiasm for delivering a ‘budget for business’ the Treasury team has ignored the effect of their changes on those who work in the public sector, and particularly in education.

These days there is much more transparency about possible budget proposals, so fewer rabbits are pulled out of the hat on budget day. However, the bus that ran once a week, probably disappeared many years ago, but petrol duty hasn’t risen in line with inflation, and electric cars now offer an alternative. By the way, how many schools have EV charging points in their car parks, and do MATs offer a salary sacrifice scheme to help with the purchase of an electric vehicle? Is there an electric mini-bus schools can purchase? And I didn’t write the headline.