Labour is poised to impose a profit cap on private schools for children with special educational needs and disabilities (SEND) under sweeping reforms to the sector.
The Schools White Paper – expected to be published imminently – is understood to include proposals to “legislate to ensure that a reasonable price is paid for a placement,” according to SEND sources.
The SEND consultation document is understood to propose regulation around fair admissions, high-quality support, financial transparency and value-for-money special schools that are not maintained by local authorities.
It comes after The i Paper found private schools can charge local authorities up to £120,000 per pupil a year, leading to accusations that they are “exploiting” the SEND crisis and pushing councils “to the brink”.
One private SEND school in south-east England is understood to charge an annual fee of around £147,000 for some pupils.
A cap would ease financial pressure on cash-strapped local councils and reduce the amount of taxpayers’ money funnelled to private companies. However, there are concerns that the move could push some private schools to closure, reducing options for parents and children.
Education Secretary Bridget Phillipson said she wanted to curb the profits of private schools for children with SEND as part of “wider reform” in an interview with The i Paper in April 2025.
Ministers have already outlined plans to crack down on profiteering in children’s social care, with a proposed profit cap on non-local authority providers of children’s homes and fostering agencies in the Children’s Wellbeing and Schools Bill.
The Department for Education (DfE) said it hopes the cap – which is yet to be defined – would only be used as a “regulatory backstop” if other market interventions did not reduce profiteering.
The i Paper previously reported that private SEND schools will be forced to charge less for state-funded pupils, with ministers hopeful that their sweeping reforms will sufficiently reduce demand on costly private-school places by beefing up SEND support in mainstream schools.
Private fees cost councils over £100,000
Private-school placements cost an average of £62,000 per head, which is more than twice the cost of a state-sector place at £24,000, according to the Institute for Fiscal Studies (IFS).
A SEND specialist at a council that has struggled with its finances said local authorities have “no choice” but to use private placements due to a historic lack of investment in state sector places.
There is a shortage of special-school places across England, with the number of pupils in special schools now hitting a record 194,000, up from 109,000 in 2014/15, according to the County Councils Network (CCN). In 2023/24, 83 per cent of state-funded special schools were either full or over-capacity.
At the same time, there has been a 43 per cent increase in the number of private SEND schools in England over the last decade, almost doubling from 456 in 2015/16 to 803 in 2024/25, DfE data shows.
The SEND specialist told The i Paper that private schools do not always offer a better service that state-run provision, but the pressure they place on council finances is leading to “the slowest car crash you can imagine”.
They welcomed a profit cap so that councils can “be assured as to what the money they are paying is being used for, the education of a young person”.
Hayley Harding, co-founder of the SEND campaign group Let Us Learn Too, also supported action to “stop companies from making excessive profits from our children”.
“Disability should never be treated as an opportunity for excess profit at the expense of money being available for other provision for other disabled children,” she told The i Paper.
Parents often fight to get private SEND schools named on their child’s education, health and care plan (EHCP), a legal document which describes a child’s individual needs and unlocks council funding to ensure those needs are met.
North Hill House, a school in Somerset run by special education group Aspris, charges annual fees of up to £120,000, according to a 2024 Ofsted report. The company said it offers “highly specialist, personalised care and support” which can bring “additional costs”.
A 2025 Ofsted report for Hilden Park School – a private special school run by the Witherslack Group in Tonbridge, Kent – found that annual day pupil fees range from £90,000 to £104,614 per pupil, with the highest fee level representing the most complex cases.
Aspris, which operates 32 schools, is ultimately owned by Waterland, a Dutch private equity firm. Witherslack Group, with 36 specialist schools across England, is owned by Mubadala Capital, a subsidiary of the Abu Dhabi sovereign wealth fund Mubadala Investment Company.
‘Arbitrary profit cap could be reckless’
The Liberal Democrats have previously called for a profit cap on private providers, as a lack of investment in state-run SEND provision has created a “vacuum that private equity firms are now exploiting for their own gain”.
“Council budgets are being pushed to the brink and private providers are seeing their profit margins soar,” Caroline Voaden MP, the Lib Dems’ schools spokesperson, said. “All the while the taxpayer is being asked to foot the bill.”
But, the National Association of Special Schools, which represents both private and state-funded special schools, called for more details over what a profit cap would look like, warning that an “arbitrary” cap would be “reckless”. It could force “trusted high-quality providers out of the sector or diminishing quality over time by restricting reinvestment”, said chief executive Claire Dorer.
She added that private special schools are “actively investing in system capacity, recruiting highly specialised staff, and providing timely, high-quality provision for children with the most challenging SEND needs”.
“While specialist provision may be more expensive upfront, the alternative – unmet needs, escalating interventions and poorer life outcomes – carries a far greater cost,” she said.
Julie Robinson, the chief executive of the Independent Schools Council (ISC), cautioned against “classifying all high-cost placements as low value”.
She said independent special schools “provide quality education and care, giving young people with SEND equity of opportunity in a way that would not be possible elsewhere. We will defend the right of these pupils to have an education that allows them to thrive, as well as defending the independence that makes that education possible.”
Robinson added that the ISC would await the White Paper to comment fully on the Government’s plans.
The Government is understood to recognise that some private-school places will still be needed after the reforms have been implemented, but that reduced demand will mean providers can no longer charge sky-high prices to remain competitive.
The DfE has been contacted for comment.
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