Government consulting on cutting Ofsted inspection subsidy for private schools

The Government is proposing to increase Ofsted inspection fees for private schools and to send the funding to the schools watchdog.

Private schools would see the subsidy for inspections cut over five years from 2026, a Department for Education (DfE) consultation published on Thursday shows, after plans were first reported at the weekend.

Funding recovered from reducing the subsidy would go to Ofsted to help boost standards in state schools, the Education Secretary said.

Bridget Phillipson added: “The taxpayer shouldn’t be subsidising private businesses in this way. Instead, we’re putting money into driving up standards for children in state schools.

“Every child deserves the best start in life, no matter where they grow up, and we are determined to break the link between background and success through our Plan for Change.

“With more money in state school budgets and a better-equipped Ofsted, we’re supporting every child to achieve and thrive.”

Around half of 2,311 registered private schools – as of January – are currently inspected by Ofsted, the DfE said. The rest are usually inspected by the Independent Schools Inspectorate, and the proposals do not affect these inspections.

There is a “significant disparity” between costs recovered and fees charged for Ofsted inspections, the DfE said.

The actual cost of private school inspections by Ofsted was around £6.5 million in 2024, but only £2.2 million of this was recovered through income from inspection fees.

That amounts to taxpayers subsidising £4.3 million in private school inspections, the DfE said.

The eight-week consultation asks for views on increasing private school inspection fees every year for five years to allow time to adjust.

The DfE said it still expects Ofsted costs to exceed fees charged by the end of the five-year period.

Inspection fees vary depending on the size of the private school. For example, schools with fewer than 100 pupils pay a fixed charge of £400 a year and a variable fee of £16 per pupil per year for a standard inspection.

Under the proposals, this would increase to a fixed charge of £420 by 2030/31 and a variable per pupil fee of £21.

For private schools with 600 or more pupils, the fixed charge would increase from £2,750 to £4,300.

The decrease in subsidy would be steadier for smaller private schools, the DfE said.

Changes would start from the 2026 academic year.

The Government removed the VAT exemption and business rates relief for private schools in January to enable funding for 6,500 new teachers in state schools.

The consultation runs from September 25 to November 20.