I do not believe that there isn't some way to, over time, scrimp and save £400, unless y'all already don't use electricity, and you exclusively eat rice and never engage in any recreational activities of any kind. Kids can work, you can sell stuff you don't need, Craigslist is full of random odd-jobs, the gig economy is a thing, you can borrow from friends, and worst case scenario, there are credit cards.

If however it is true that there is literally no way to come up with £400, then you should be able to effectively make that argument to the school. And if the new head person refuses to listen, just keep complaining and kicking up a fuss to the next-highest person until you get through. It would also help to have other parents on your side, and in the best case scenario, y'all would go to higherups together and collectively refuse to comply with the new rule.

FWIW, I think financial inability to comply the imposition of new demands that did not exist before is 100% a reason for those demands to be waived, and I'm entirely on your side. However, if the cost of failure to comply is that your son can't graduate, then it's incumbent upon you as a parent to do literally everything in your power to make that happen.

Good luck! Your son's school is 100% run by assholes, and I wish you the best.