More Parents Take Out Loans to Fund Children's Education

An increasing numbers of parents are applying forCollege must each pay £10,000 in addition to
bank loans to fund their children through private school,making payments averaging £60,000 to a new
new figures reveal.educational charity.
Household expenditure on private school fees reachedAn investigation by the Office of Fair Trading led to
approximately £7.9billion last year, up fromthe payout.
£6.9billion in 2001-02.The schools had admitted that, over the past three
Sainsbury's Bank revealed it had seen a 38 per centyears, they had been sharing detailed and sensitive
increase in loan applications to cover independentinformation about the fees they were intending to
school fees during the past year.charge both for boarding and day pupils.
Loans manager at Sainsbury's Bank, Steven Bailie, saidMeanwhile previous studies have already revealed that
he expected to see a further rise in numbers as feestens of thousands of parents are keen to send their
have gone up by about 50 per cent since 1999.children to private school as a result of mounting
He said that about 620,000 children are now beingdisillusionment with the state sector. This inevitably
educated in private schools, and they are consistentlybrings a financial consequence.
charging more in fees.They are cancelling family holidays and juggling two or
'We expect to see a growing number of parentsthree jobs in order to fund a private education.
taking out loans to help pay for their children'sThe ISC recently provided detailed analysis covering
education. Those parents doing this need to make surehundreds of thousands of postcodes and collected
that they shop around and find a competitive loan rate.'from 900 member schools.
Based on ONS data, the bank's figures showedThe research showed that nearly a quarter of ISC
families in London usually spent the most on educationpupils (23.8 per cent) originate from average or below
fees, at an average of £577.20 per year.average backgrounds. Almost 10 per cent (some
Families in the East Midlands spent the least, at around43,000 pupils) live in postcodes where household
£140.40 per year.income is less than the national average.
These average figures were generated from allOf these, 10,000 reside in officially classified
households, including those without children in private'hard-pressed' areas and include families on low
education and those with no children.incomes, single parents on council estates and people
Separate figures from the Independent Schoolsliving in high rise flats.
Council, however, show that average fees are nowAnd another survey by ING Direct found that almost
about £21,600-a-year for boys' boarding schoolshalf (44 per cent) of parents are saving money
whilst for girls, the figure is £20,400.specifically for their children's education. In the last few
For pre-preparatory private education (for childrenyears, this figure used to stand at just 12 per cent.
aged two to seven years), parents can expect to payThe fact that many parents are willing to take out
between £1,000 to £1,500 a term.loans - and thus pay interest - to finance school fees
Fee fixing allegationsdemonstrates the importance that they place upon
The annual rise in private school charges was underhigh quality education said a spokesman for the ICS.
public scrutiny recently following an investigation intoIndependent school parents who have average or
alleged fee fixing which saw fifty of the country'sbelow average incomes represent about a quarter of
leading public schools ordered to pay out a total ofthe total and many are going without exotic holidays or
£3.5million.new cars to give their children an independent
Earlier this year it was revealed that schools includingeducation.
Eton, Harrow, Winchester and Cheltenham Ladies'