Exclusive:Edinburgh school Fettes College looks to cut staff in face of rising costs and shrinking student roll

Fee-paying institution stresses need to run school ‘efficiently as possible’

One of Scotland’s most exclusive fee-paying schools has said that some of its workforce may be made redundant amid ongoing financial pressures, The Scotsman can reveal.

Fettes College, which counts former prime minister Tony Blair among its alumni, is undertaking a consultation process designed to lower its staff headcount as it contends with the fallout from the introduction of VAT on private school fees and the rise in National Insurance contributions.

The esteemed private school, which dates back to the 19th century, said that despite being “financially very well managed” and having a “strong” student roll, such factors were “having an impact on our costs and numbers.” It said it was obliged to run its operations as “efficiently as possible,” and said parents of its pupils needed to be certain that it was using their money “effectively.”

It is understood that teaching staff as well as operational staff at the school are among those whose positions are at risk as part of the proposed changes. The development is one of the starkest signs yet of the growing financial pressures faced by private schools, and comes at a time when student numbers at Fettes have been falling.

The prestigious Fettes College in Edinburgh counts former prime minister Sir Tony Blair among its alumni. Picture: PA | PA

Student numbers down from 803 to 751

Fettes said it began a consultation process last month to “right size our staffing model,” adding: “This difficult decision may result in some redundancies.” However, sources at the school have expressed misgivings over the process, with one characterising it as "insensitive" and “tone deaf.”

Accounts submitted by the school with Companies House show a modest decline in the number of students it educates. Over the 12 months to 31 August 2024, the most recent period for which filings are available, the school educated 751 students, down from 780 across the previous 12 month period, and 803 in 2022.

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The total income of the school for the 12 months to the end of August 2024 stood at nearly £24.2m, while its total expenditure amounted to more than £26.2m, with staffing accounting for the greatest share of that figure at some £15.4m.

Fettes employs approximately 125 teaching staff and around 210 operational staff who work across various departments, such as estates, housekeeping, catering, IT, finance, admissions, security, and marketing. The school is currently recruiting for a new head teacher, with the incumbent, Helen Harrison, set to retire next year.

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School says it has use money ‘effectively’

In a statement, a spokesman for Fettes said: “Various factors have conspired to increase costs on all organisations and schools are not immune, particularly with the recent imposition of VAT on school fees and rise in National Insurance contributions. Despite being financially very well managed with a strong student roll, these factors are having an impact on our costs and numbers, and we are obliged to run our operations as efficiently as possible.

“These headwinds obviously affect our families too, and our parents need to be certain that we are taking the necessary decisions to run the school efficiently and to use their money effectively.”

The spokesman said that Fettes will continue to provide the “highest standard of educational experience,” and deliver its “innovative vision” for the school while maintaining its position as “a leader in the sector.”

He added: “Looking after our staff is fundamental to who we are and we have undertaken this process with care, following ACAS guidelines. This is a tough time for our sector and we ask for everyone to be sensitive to the privacy and circumstances of the individuals who may be affected. Accordingly, we will not be making any further comment at this time.”

As part of their efforts to raise income, the governors of Fettes are also looking at setting up further international schools to join the purpose-built facility in the Chinese city of Guangzhou that bears the Fettes name, and which is owned by the Country Garden Education group.

The most recent accounts for Fettes note that “the governors’ ambitions to explore options and derive additional income from overseas schools continue and a team comprising governors and senior management is in dialogue with investors and operators in new parts of the world where they believe the Fettes proposition will be well received.”

VAT charge a ‘step too far’ for many schools

It comes as the head of the body that represents most private schools in the UK warned last week of the increasing financial pressures facing the sector, amid reports of school closures.

Julie Robinson, chief executive of the Independent Schools Council (ISC), said that after enduring the challenges of the pandemic, the cost of living crisis, and rising costs and inflation, the introduction of VAT on school fees was a “step too far” for many schools, and had “tipped them over the edge.” The ISC has estimated that around 13,000 children around the UK have left private education this year as a result of the VAT policy and its impact on their families.

Previously, private schools did not have to charge 20 per cent VAT on their fees thanks to an exemption for organisations providing education. However, that exemption was removed at the start of this year. Fettes was among those schools to make representations as part of a government consultation over the policy, claiming that a “negligible number” of schools would be able to simply absorb the cost of the VAT. The majority of private schools in Scotland have posted deficits in recent years.

According to its website, fees at Fettes College - attended by youngsters aged 13 to 18 - stand at £15,150 per term for day pupils, rising to £18,000 per term for boarders. Its prep school fees - for children aged seven to 13 - are £8,500 per term for day pupils and £12,500 per term for boarders.

Earlier this month, a group of private schools, pupils and their parents lost High Court challenges over the imposition of VAT on school fees. They claimed the levy was discriminatory and incompatible with human rights legislation, but Dame Victoria Sharp, Lord Justice Newey and Mr Justice Chamberlain said there was a “broad margin of discretion in deciding how to balance the interests of those adversely affected by the policy against the interests of others who may gain from public provision funded by the money it will raise.”

The UK government welcomed the judgment, and said the VAT policy would raise around £1.8 billion a year to support pupils in state schools.

Research by the ISC found that on average, private school fees were 22 per cent higher in January 2025 than in the same month in 2024,