HC Deb 13 December 1994 vol 251 cc759-60
6. Mr. Bill Michie

To ask the Secretary of State for Education what plans she has to phase out extra capital grants to grant-maintained schools.

The Parliamentary Under-Secretary of State for Schools (Mr. Robin Squire)

The distribution of capital resources continues to reflect Ministers' judgment of appropriate funding levels in each sector, and our commitment to setting up grant-maintained schools on a sound basis. The detail of the capital grants regime for grant-maintained schools is now a matter for the Funding Agency for Schools.

Mr. Michie

Another Tory pledge has not been fulfilled. Following the Budget settlement, local education authorities now face cuts while grant-maintained schools still receive three times as much capital per head. Is it not about time that the Government treated local education authorities with fairness rather than prejudice, and eliminated a gap that is not only indefensible but immoral?

Mr. Squire

The hon. Gentleman is misled and his comments are facile. Let me briefly give him some reasons why. He seeks, presumably, to make a pound for pound comparison, yet he knows, or should know, that every GM school is not able to draw on capital receipts or to transfer from revenue expenditure to capital, like local education authorities can. To take one further instance, GM schools attract VAT, and LEA schools do not. Spending £1 in a GM school, therefore, is not the same as spending £1 in an LEA school. The Government are satisfied that the settlement is fair to GM schools, but not excessively fair.

Mr. Robert Banks

I offer my most sincere thanks to my hon. Friend and to my right hon. Friend the Secretary of State for Education for approving the application for grant-maintained status from Nunmonkton school in my constituency. It is the result of a remarkable campaign by all 19 pupils—[Interruption.]—all the parents and all the villagers. They have led the way against North Yorkshire county council's decision to close the school. It means that the school can go ahead and will be saved, and I pass on the appreciation of all the villagers to my hon. Friend.

Mr. Squire

I am obviously grateful for my hon. Friend's kind comments. I agree with him that Nunmonkton school has all the prospects of being an excellent school and the House will have no noted the derision with which Opposition Members greeted his announcement that there were 19 pupils at the school. All people worried about small rural schools will know which party not to trust.

Dr. Wright

Although the Government have talked the language of diversity, have they not given us the practice of discrimination in relation to the funding of GM schools? Has that discrimination not been established both by the Education Select Committee and by the National Audit Office? Once the pot of gold and the bribe are taken away, interest in moving to GM status will wane by the day.

Mr. Squire

In light of current discussions, I am not sure whether interest in GM schools is waning or whether it would be wise for me to comment on that, if one considers the hon. Gentleman's party. As he should know, revenue funding for GM schools is on the same basis as revenue funding for LEA schools, and he heard my earlier answer on capital funding.