HC Deb 17 November 1969 vol 791 cc861-4
The Secretary of State for Education and Science (Mr. Edward Short)

With permission, Mr. Speaker, I wish to make a statement about a decision which the Government have taken about the subsidy on school meals and to explain the background to it.

The average cost of providing a school dinner in England and Wales is at present approximately 2s. 10d. The charge to the parent is 1s. 6d. There is thus a subsidy of ls. 4d. on each meal.

The cost of the subsidy for the present financial year is about £93.9 million, including £12.9 million capital expenditure. In 1964–65 it was about £64.3 million, including £10.3 million capital expenditure. The Government have decided that the subsidy should be restored to 1s. ld. at which it stood after the last increase in the charge. The charge will, in consequence, be increased from ls. 6d. to ls. 9d. on 1st April, 1970.

My right hon. Friend the Secretary of State for Scotland has asked me to say that the same increase in the charge will be made in Scotland from the beginning of the summer term 1970.

As a result of these increases there will be a saving in public expenditure by central Government and local authorities of about £l1 million in a year. This will be taken into account in any subsequent review of the rate support grant.

Meals will, of course, continue to be supplied free for children whose parents cannot afford to pay the new charge without financial hardship, and the remission scales will be improved to allow for this change in addition to the improvements earlier this month to take account of improved benefit rates.

Mr. van Straubenzee

The Secretary of State ended his statement with a reference to exemption. Has he made any estimate of the increased percentage of children on whose behalf exemption will be claimed as a result of the increase which he has just announced? Would he agree that this increase, and others which may follow, make it wise to consider a method of claiming exemption for children which does not positively identify an individual child in class? Would he give his mind to this problem?

Mr. Short

I am grateful to the hon. Gentleman for the last point which he makes. I am considering at the moment whether a better method can be devised. It is difficult to answer his first point, but the fall in the take-up of paid meals will probably be very small. We estimate the £11 million saving on the basis of a 5 per cent. fall. But quite a lot of pupils will get free meals.

Mr. R. C. Mitchell

How much of the £11 million estimated saving will accrue to the Government and how much to local authorities? What guarantee do we have that the money saved by the local authorities will be used for other educational expenditure?

Mr. Short

Local authority expenditure at the moment is paid for in the proportion of 57 per cent. by the rate support grant and 43 per cent. from local rates. On that basis, about £4.7 million will accrue to the local authorities. They can spend it as they like, but I certainly hope that they will spend it on employing more teachers, particularly part-time teachers.

Mr. Pardoe

Does the £81 million subsidy take account of the full cost of free meals? Would the Secretary of State undertake to have another look at the suggestion which I made in the debate that we had at the time of the last increase, that the full cost of the meals should be taken back in income tax so that there is no question of money passing across the classroom?

Mr. Short

The answer to the first part of the question is, "Yes". I suggest that the hon. Gentleman puts the second part to my right hon. Friend the Chancellor of the Exchequer.

Sir M. Galpern

Does my right hon. Friend recognise that there is a steady whittling away of the school meals service —first, the abolition of the supply of free milk in secondary schools, which has been roundly condemned throughout the country, and now this further increase in the charge for school meals, which will save, on my right hon. Friend's estimate, £11 million? Should my right hon. Friend proceed with this proposed increase for the sake of this niggardly saving of £11 million?

Mr. Short

To say that the school meals service is being whittled away is plainly nonsense. Sixty-nine per cent. of all school children are getting school meals. In 1964, the figure was 62 per cent. So the service is not being whittled away; it is increasing. But the subsidy is now approaching the £100 million mark, and we must be prepared to weigh one priority in the education service against another.

Mr. Edward M. Taylor

Would the right hon. Gentleman say whether there was any significant or lasting reduction in the numbers of children taking school meals at the time of the last price increase, and whether he expects one this time?

Mr. Short

There was a small fall-off immediately afterwards, but it very quickly came back again.

Mr. Christopher Price

Is my right hon. Friend aware that he has now reduced the subsidy from over 50 per cent. to less than 40 per cent. of the cost of the meals? Is it not unrealistic to take a flat-rate figure as the subsidy and far more proper to try to hold the subsidy at a particular percentage of the total cost? Could he not stick to the 50 per cent., which has been traditional in the past?

Mr. Short

It has not been traditional. The subsidy has fluctuated. It has gone up and it has gone down at various times. As I said before, the cost of the subsidy is now approaching £100 million. [Interruption.] There are other ways of spending money well in the education service. We must consider one priority against another.

Mr. J. E. B. Hill

Is not the most worrying aspect of this increase the very sharp rise in the cost of school meals, food and labour, over the last five years? Does it not indicate a really appalling degree of inflation?

Mr. Short

It does not. The cost of school meals has increased much less than retail prices generally, and great credit is due to the local authorities for organising their school meals service much more efficiently.

Mr. English

My right hon. Friend says that the cost of the subsidy is now approaching £100 million. Has his Department compared this with the cost of subsidies given by employers in industry to their employees?

Mr. Short

That is another point. But this is a very big subsidy. We are willing to have a very big subsidy, but I think that we must look at other areas of expenditure in the education service and weigh one thing against another and try to hold a reasonable balance.

Mr. Fortescue

Has the right hon. Gentleman been informed about the system for school meals, based on frozen food entirely, introduced by the City of Liverpool on the advice of a leading firm of management consultants, which will save a lot of money? Will the right hon. Gentleman consider this system for the rest of the country?

Mr. Short

We are watching the experiment in Liverpool very carefully.

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