A RESIDENTIAL school for children with significant additional support needs is to close.

Parents of children at The New School Butterstone in Dunkeld, Perth and Kinross, have been told the school will shut this Friday.

An email from the school blamed increased costs and a reduction of income for the closure decision. It is understood a take-over deal for the school recetly fell through.

However, the moves comes shortly after a highly critical Care Inspectorate report which threatened to remove the school’s registration unless it urgently addressed child protection failings.

The Care Inspectorate had given Butterstone School days to address "serious failings" in its child protection procedures.

It also gave the school until Wednesday to take steps to ensure children using the service "must be kept safe from inappropriate behaviour and by members of staff".

Since it opened 25 years ago, the independent school has specialised in education for young people with autistic spectrum conditions, or other conditions that require a therapeutic approach to learning.

In the email sent to parents Sir Andrew Cubie, chairman of the school’s board of governors, said: “It is with the heaviest heart that I write to advise you that after 25 years The New School Butterstone is to close."

Acknowledging it would be “a deep disappointment” to families, added: "Regrettably, the combination of increased costs and a reduction of income exacerbated an already uncertain financial position and has left the school in a situation that is now financially unviable."

The parent of one child told BBC Scotland the closure would hit families whose children were not suited to attending mainstream schools, adding: "This population of young people will need extensive transition planning and ultimately the closure of the school will leave them, at least initially, outwith education.

"For my son I am sadly confident in saying this will result in his already fragile mental health deteriorating further and becoming withdrawn from the world around him.

"In at least the immediate future it will result in parents being unable to work and having to care for children during the day. The consequences of this are devastating and far-reaching for such a vulnerable group of our society."

John Swinney, the Education Secretary, who is also the local MSP, said he would work with the school and public bodies to support those affected.