Why 'angry and sad' parents say VAT change did not cause closure of Scottish Catholic school

Families impacted by the closure of a Catholic boarding school in Scotland have been left “incredibly angry and sad” about the decision, which they say had little to do with a change to VAT charges.

Kilgraston School in Perthshire announced its closure on Tuesday, revealing a planned sale had fallen through after an investor, Achieve Education, "reassessed its commitment" to the institution.

It also highlighted the "the possible impact of VAT on school fees" as a factor, in reference to Labour’s plans to end the sector’s exemption from the tax from January 1, next year.

But parents told The Scotsman the closure had “absolutely nothing” to do with VAT.

They said the rethink by investors came as a result of its poor recruitment and retention over the last year, resulting in a failure to reach a target of 210 pupils, with the current roll being 173. It is understood the target was set by the school, which was founded in 1930, when it was saved from closure last year as a result of a fundraiser set up by parents, which raised £1.2 million within 48 hours.

Some parents are thought to have been left frustrated that a closure decision was taken without any attempt to save the school through a new fundraiser.

A meeting was held on Tuesday that was said to have been “full of incredibly angry and sad parents”.

One parent said: “There was a huge amount of anger and frustration and sadness.

“This absolutely isn’t about the VAT issue, because everybody has known about that issue for at least two years. Parents and the school should have been gearing up for that.

“There is also anger that the trustees wouldn’t let the parents make an appeal.”

Affected students will be offered places at nearby Glenalmond College and Craigclowan School.

A total of 93 staff also worked at Kilgraston, with one posting on social media: “I can’t believe I am writing this. But yesterday I was made redundant as my beloved school closed its doors for the final time.

“My heart is broken for all of my colleagues and pupils. Thank you Kilgraston for the happiest years of my life. I will cherish the memories forever x.”

A spokesperson for the school’s trustees said: “The board of trustees has explored a number of opportunities in a bid to save the school but unfortunately none of these have offered a financially viable solution. This leaves the school with no choice but to close.”

In a letter to parents, the board said: “With Achieve Education no longer financially supporting the school, the possible impact of VAT on school fees and with an expected roll of 173 pupils, we were facing a serious short-term funding shortfall of £860,000 for the forthcoming academic year. The breakeven point is 210 pupils.

“The trustees were therefore at very short notice, required to do all we could to try and find an alternative investor to finance the school as well as repay the current loans and finance commitments of circa £3.4 million.”

They said they approached at least 40 education and charitable organisations directly for investment, as well as a number of “high net worth individuals”, and succeeded in “raising over £348,500 in promised donations and forward fees”, as well as identifying £150,000 of cost savings.

The letter said: “Whilst there had been a possibility of finding a new major investor to replace Achieve, the trustees were guided by the professional advice received that they should not launch a parent appeal at the same time.

“Our specialist adviser had expressed the concern that a public parent appeal could have a detrimental impact on pupil numbers, potentially making the school less attractive to investors.

“In the circumstances, the trustees accepted that it was not in the best interests of the school to take this risk by holding a parent appeal.”

The closure of Kilgraston was confirmed in the same week that it was announced that Cedars School in Greenock, which offered a Christian education, would shut next month. It also highlighted the impact of the VAT change.

A parent wrote on social media site X: “Very sad to see Kilgraston and Cedars School of Excellence close.

“My nieces attended the former, which provided a great education, but there are other schools nearby which can provide similar. Not so with Cedars, which my oldest son attended: it provided a haven for children failed and damaged by the state system.

“Few parents were wealthy, many were working class who scrimped and saved, so even a 10 per cent rise in fees was too much.”

Lorraine Davidson, the chief executive of the Scottish Council of Independent Schools, said: “The closure of Kilgraston school in Perthshire and Cedars school in Greenock is extremely sad for the pupils, parents, staff and the wider communities, in which they were an integral part. “The potential impact of VAT on school fees on the Scottish sector has not been understood by the UK government.

“The Scottish Council for Independent Schools is calling on the UK government not to implement VAT in the middle of a school year when budgets and fees have already been set.  “The sector was told schools and families would be given time to prepare for this significant change. “Implementing VAT from September 2025, instead of January 2025 would limit the disruption to the education of pupils in both the independent and state sectors. 

“We have asked for talks with the UK government so we can share the evidence of the impact on Scottish education.”

A UK government spokesperson said: “We want to ensure all children have the best chance in life to succeed.

“Ending tax breaks on private schools will help to raise the revenue needed to fund our education priorities for next year, such as recruiting 6,500 new teachers.”