The proprietor at one of East Lancashire’s leading private schools has quashed rumours of potential liquidation but says funding has become an issue since the pandemic.

Concerns were raised over Moorland School, in Ribblesdale Avenue, Clitheroe, due to Companies House listing its holding company as in 'liquidation' with more than £1.7m of debts.

However, bosses say the reason for this is the overarching company, Moorland School Limited, has been split into three different entities for the nursery, primary and secondary.

Jonathan Harrison, proprietor at Moorland School said: “Our sector has been smashed due to covid, and we lost a number of boarders which is a key source of income.

"We have shut our old trading and reborn the three new entities, with different senior leadership and we are continuing to trade as we would do normally.

“From a parental perspective, there has been no change and it is going forward. We had to make the operational decisions to change how we work.”

Last month, Chancellor Rachel Reeves confirmed in the Budget that 20% VAT would be applied to private schools in the UK from January 1.

The Government has estimated the policy will raise £460million next year, rising to £1.7 billion by 2029/30.

Mr Harrison added: “The Labour government are trying to finish us off with the tax rises.

“We haven’t got enough schools and if they were to put this into state schools it would cost £6,000 per child.

“We are still considered to be one of the best education institutions in the world and it is going to be a barrier for overseas parents to use overseas education for their children.

“There aren’t enough schools in the Ribble Valley and if Moorlands were to go there would be nowhere for these children to go. It is such an ill-thought-out strategy and I just don’t get it.”

With the aid of the administrator, he said the school has paid the commercial value for the assets into the three new companies and is continuing to trade under the new businesses.

There were also concerns raised by residents over outstanding debts owed by the school to local businesses in Clitheroe.

One Clitheroe resident, who wanted to remain anonymous said: "It is incredibly infuriating that a business can write off such huge debts but yet continue to trade as normal even sharing on their social media the investments they are making to the school in the new school year.

"We all know it’s hard in business especially in the current economic climate and I hate to see anyone struggle but for those of us who scrimp and save to pay our bills especially to HMRC to know companies can just write them off and continue as if nothing happened is horrible."

As the proprietor, Mr Harrison says he has personally paid those debts and settled all the invoices, with money from his other business interests, with the only outstanding debt owed to HMRC.

He added: “I know a lot of people who go bust and the people who have small businesses suffer and that isn’t the case.

“Nothing sinister or dirty is going on. It is what we had to do to get through and be more competitive and restructure.”

In 2022, Heathland Private School in Accrington wrote to parents telling them the school and nursery would be closing and blamed 'financial strain' due to the strain of the pandemic. 

The directors of Heathland also run Moorlands Nursery and School and they took on pupils from the closing school.