§ Motion made, and Question proposed, That this House do now adjourn.—[Mr. Burns.]
§ 10 pm
§ Mr. Mike O'Brien (Warwickshire, North)Warwickshire's schools are in crisis. Parents in my constituency are rightly angry at the damage being done to the education of their children by the Government's financial settlement on local authorities. The Secretary of State for Education has described the local authority settlement as tough. That is right. It is tough on children and on the education opportunities that will be given to them. Children have only one chance of a decent education and it is morally wrong to sacrifice it on the altar of storing up a money chest for pre-election tax cuts.
A couple of months ago a march in London showed just how angry the people of Warwickshire are about education cuts. Parents of all political persuasions and of none joined to protest against the cuts, and many of them came from my constituency. It was an angry shout from middle England, which the Government will ignore at their peril.
As I said, those parents were of all political persuasions—and they included people who had been Conservatives. In Warwickshire opposition to Government policy on the funding of schools is not a party political issue: it unites all the parties and the people against the Government. None of the usual Government excuses applies to Warwickshire. The county is a prudent authority with an excellent auditor's report on administration. Yes, it was poll tax-capped twice some years ago, but at that time it was under Tory control. Whether under Conservative or the present Labour control, the councillors and Warwickshire Members have united in saying that the county is broadly well run, and that the Government's calculation of the standard spending assessment and of capping is unfair, unjustifiable and damaging to children's education.
I shall give some examples from north Warwickshire of the impact of education cuts. St. Edward's primary school in Coleshill will have 205 pupils in September, an increase of 25, and a cut in staffing. Mrs. Gill Owen, an excellent head teacher who tries to run a high-quality school, told me today that she will have to cope with a mixed-ability class of 39, two classes of 36 and three of more than 30. The school repair budget is overstretched and its buildings are dilapidated.
Governors are so angry that they have set a deficit needs budget, as up to 20 schools in the county have done. Although I do not approve of deficit budgets, the anger of all the governors is shown by the fact that the chairman of governors describes himself as previously a lifelong Tory voter. A Conservative councillor who is a governor also voted for the deficit budget. The governors did that because they were angry. The capitation fee for pupils, for example, for books and equipment was already too low at £30, but next year it will fall to £10. Those governors believed that education standards were threatened at the school and they wanted to protest. I do not justify those governors, who regarded themselves as Conservatives, breaking the law, but cannot the Minister understand why they did?
In Bedworth, at Nicholas Chamberlain secondary school, 13 teacher posts are to go. Kevin Scott, the excellent new head teacher, said today that he had the 572 problem of a £280,000 deficit on his £2.4 million budget. Class sizes will rise, pupils will have fewer subject choices and practical classes will exceed 25 pupils—in classrooms that were not designed for practical classes of that size. He fears significant health and safety dangers. There will be fewer books, building maintenance will be cut—the school library has already closed—and information technology provision will deteriorate further.
The school expects to have a deficit carry-over from this year of £30,000 due to the underfunding of last year's teachers pay award. This year, the county cannot fund the pay award, which will put another £50,000 on the schools budget. SSA cuts will amount to £70,000. All that means that there will be no extra income, for example, to cover teachers who go sick. Colleagues will have to cover for the sick, adding to already heavily stressed teaching loads. That will also unnecessarily endanger the standard of education.
The Office for Standards in Education has told the school that, as a result of local management of schools, it must now fill an administrative post that it deliberately left vacant from April last year to save money. Governors are dealing with the obvious anger of teachers who will lose jobs, while Ofsted says that administrative assistance is needed because of LMS budgets. I could list the problems at school after school in my constituency. Polesworth high school is losing £112,000 and is gaining an extra 62 pupils. Coleshill high school has a substantial budget shortfall, too.
The list could go on. It is significant, however, that no one blames the local county council. Everyone knows that the Government's SSA education criteria are £10 million below what the schools really need. How in all conscience can the Government justify what they are doing to Warwickshire schoolchildren? Even local Conservative councillors will not justify it.
I repeat: none of the usual Government excuses for cuts in Warwickshire applies. Is there too much administration? There is not in Warwickshire. The auditors say that there is not. The council spends 73.1 per cent. of the English county average on administration. It has already sliced £1.6 million off budgets in recent years. Not even the Conservative leader on the county council believes that any more can be cut without significantly endangering financial prudence in administration.
Should Warwickshire remove surplus places? The Secretary of State has already praised Warwickshire for its planning, to which I shall return. Should it remove discretionary elements in the budget? Warwickshire has not been awarding discretionary grants for years. The youth service has been decimated. Only nursery education funding is maintained. If the Minister really wants nurseries to close, he must say so clearly and explain how that fits in with the Prime Minister's promises on nursery education.
Should school balances be used? In Warwickshire, that is not really a practical option. Many schools threatened with cuts have no balances. Half of them could not meet the cuts imposed from their balances anyway and others are already eating into provision for repairs and emergencies. The larger balances are concentrated in a minority of schools and not in the schools most directly threatened by the cuts. Should Warwickshire cut management perks in administration? The Audit Commission says that many management perks, as they might be called, are already in the lower quartile.
573 In December, an Education Minister—not the Under-Secretary of State for Schools, who is on the Front Bench—said that, in September, Warwickshire had appointed an extra 500 staff. I remember it well, because the chairman of the education committee was in the Strangers Gallery. I looked up at him and he waved his arms and could not imagine how that could possibly be. When he checked the figures that the other Minister had used, he found that they were the figures for the one-year contracts that had been granted and for the provision of ancillary staff. Moreover, they were September to December figures, which always show an increase simply because people are moving from one post to another.
That incident did not show that Warwickshire had taken on 500 extra staff; that simply was not true. It showed that Ministers used that argument because there was such a paucity of genuine argument to justify and defend their actions.
Warwickshire needs three things. First, the Government should lift the cap. It is not only Opposition Members who say that; it has been said by Conservative Members, too. If the cap were lifted, local people could decide how much they wanted their councillors to impose in council tax. I hope that they would decide that they wanted sufficient tax to fund their schools properly.
We also want fair treatment for Warwickshire in the standard spending assessment. That is not fair at the moment, and has not been fair for a long time. The Government must accept that. The reason is clear, and the Minister can check it with Conservative councillors in the county. No doubt they will agree with me.
Way back at the beginning of the poll tax, the Conservatives who then controlled the county decided to implement the promises on which they had been elected and cut spending in Warwickshire. And for the first year of the poll tax that is what they did. The following year, the Government used the expenditure for that previous year as the base for setting the SSA and capping. Everyone in Warwickshire agrees that, as a result, the county has been unfairly treated since then, and expenditure has been ratcheted down in an entirely wrong way. As a result, damage is being inflicted on the children of the county.
We have also asked the Government to raise the education disregard to cover the costs of reorganisation. I therefore ask the Minister to consider those three things: lift the cap; give the county fair treatment over its SSA; and raise the education disregard to cover the cost of reorganisation.
There is one important thing to say about education reorganisation. The Secretary of State has been telling councils across the country to remove surplus places. But I warn other councils to expect more than a simple refusal to lift the education disregard to fund the reorganisation that will remove surplus places. In Warwickshire's case, that reorganisation has been jeopardised by the Government's delay in making a decision on the second tranche of the changes.
The chief education officer tells me that the county is on the brink of being forced to pull the plug on the reorganisation because of Government prevarication. The delay is bringing us the prospect of chaos. Building contracts need to be made and new teaching posts sorted out. Will the Minister tell me when the decision will be made? Or will he confirm that his Department has legal problems as a result of the decision by Mr. Justice Sedley 574 in the High Court on 12 April in the case of Regina v. Secretary of State for Education ex parte Skitt? The Government had bungled the closure for Beacon school in Walsall by accepting advice from inspectors of schools on which parents had no opportunity to comment. Have they done the same with the Warwickshire reorganisation? Is that the reason for the delay?
Partly through incompetence and partly through a failure to listen not only to the Opposition but to Conservative Members who speak for Warwickshire, the Department for Education is now imposing damage upon Warwickshire children that cannot be justified. I exclude mendacity, because I absolve the Ministers at the Department for Education of that—although I have my doubts about Ministers at the Treasury and at the Department of the Environment. Will the Minister now act to lift the cap for Warwickshire? Will he reform the SSA, or at least adjust the education disregard?
I ask not just on behalf of my constituents, but on behalf of those who have the most to lose from the Government's shambles—the children in Warwickshire schools.
§ The Parliamentary Under-Secretary of State for Schools (Mr. Robin Squire)I welcome the opportunity provided by the hon. Member for Warwickshire, North (Mr. O'Brien) to discuss education in the county of Warwickshire. While the hon. Gentleman would not expect me to agree with every one of his comments, I welcome the way in which he raised the issue.
The hon. Gentleman started by expressing particular concern about the level of resources made available by the Government for education this year. Let me make clear from the start that, so far as education expenditure is concerned, Warwickshire county council—like every other local authority—is responsible for setting its own budget and deciding its priorities between and within services. It is the council which has the final say on how much is spent on education and how much is spent on other services. It is also the council which determines, by its local management of schools scheme, exactly how much local schools receive.
It has been said by some—although not by the hon. Gentleman—that Warwickshire has been forced to cut its education budget by 3 per cent. in the current financial year. There is no reason why this should happen. The Government have provided for Warwickshire's education standard spending assessment to increase by 1.2 per cent. this year, and under the capping rules it can spend 0.5 per cent. more in 1995–1996 than it did in 1994–95. In total, Warwickshire is able to spend over £273 million on all services this year.
What does the talk about "cuts" actually mean? The county council is certainly not cutting what it is actually spending, although, most importantly it has decided to spend less of its total budget on education. Warwickshire has drawn up a shopping list of additional spending—it is not alone in that respect—and is then cutting back on what it would ideally like to spend if it could buy all the items on that list. Everyone in the public sector and in business faces the same problem, and the solution of course is to become more efficient. To say or imply that there must be full cover for all wage and price increases is to say that there is no scope for efficiency gains, which must be untrue.
575 It is not unreasonable for Ministers to expect authorities to help fund education by becoming more efficient. Authorities continue to spend vast amounts of money on running their education departments. A recent Audit Commission report found scope for saving over £500 million on the pay bill of local authorities' administrative and clerical staff. In addition, a previous report by the commission found that there was scope for saving over £30 million by rationalising special schools.
It is also not unreasonable for the Government to expect schools to use some of their balances to help offset the cost of providing education. I accept what the hon. Gentleman said about all schools not having available balances, and I hope that he accepts that some do. No information on individual school balances at the end of 1994–1995 is yet available, but at the end of 1993–1994 primary schools in Warwickshire had balances which in total amounted to 6.3 per cent. of their budget shares. Secondary schools had 6.7 per cent.
All schools need to consider what balances they should sensibly hold as a result of planning, not merely casual accrual. They can scarcely complain, given those reserves, that they were underfunded during that time. If reserves are not available for particular schools then they need to pay particular attention to their management of resources. They may also wish to suggest to the authority that its LMS scheme might be amended for future years in order to change the distribution of funds.
I know that Warwickshire schools, like schools in other areas, are concerned about meeting the cost of the teachers' pay award. The Government accepted the award of 2.7 per cent. on the recommendation of the school teachers' pay review body. That body acknowledged the fact that financial provision had been set on the basis that pay increases should be offset, or more than offset, by efficiency gains and increased productivity. We have acknowledged—the hon. Gentleman highlighted it in his comments—that the current settlement is tough. There is no resiling from that statement. Nevertheless, many authorities have been able to achieve an increase in their budgets which matches or outstrips the teachers' pay award and have said that they will meet the pay award in full.
It is worth making the point that, although many local authorities claim that they cannot afford the teachers' pay award, they have reached separately a voluntary pay settlement of their own of over 2 per cent. for clerical and manual staff.
I acknowledge that the award will place local authority budgets under pressure. But, in fairness, local authorities are large and financially complex organisations and they have a variety of means of realising the efficiency gains that are needed.
§ Mr. Mike O'BrienWill the Minister give way?
§ Mr. SquireI hope that the hon. Gentleman will recognise that I usually give way. I am willing to do so if I make progress in my speech. He would wish me to reach reorganisation proposals and I am anxious to cover those in considerable detail. If there is time, I promise the hon. Gentleman that I shall give way to him.
The Government consider that teachers thoroughly deserve the increase, in recognition of the excellent work that they carry out in raising standards in our schools. 576 Governors, teachers and parents, as well as the Government, are entitled to look to local authorities to give priority to front-line services such as schools. I hope and trust that the county council will do so.
I thought that the hon. Gentleman would raise the question of Warwickshire's SSA. I am aware that its SSA per pupil is lower than the average, albeit higher than nine other authorities. But, as the hon. Member is aware, the SSA system sets out to provide funding for a standard level of service nationwide. Comparisons with other local education authorities are not necessarily appropriate because the costs of providing a standard level of education across the country inevitably vary. Some of the factors that need to be taken into account are the costs of educating children in sparsely populated areas, the costs of educating children in areas that are socially or economically disadvantaged, and the high labour costs in London and the south-east. Not all authorities will have such high costs or special circumstances as other LEAs do and, therefore, the "poundage per pupil" must vary from LEA to LEA.
The hon. Gentleman also referred to deficit school budgets. Under section 37 of the Education Reform Act 1988, a local education authority may suspend a governing body's right to a delegated budget if the governors fail to comply with the requirements of the local education authority's local management of schools scheme, or more generally, if they appear to manage the school's finances unsatisfactorily.
Where a governing body refuses to set a balanced budget, the LEA will no doubt wish to consider whether to intervene on either or both those grounds. In the event, we have been notified by Warwickshire that it has suspended delegation in the case of four schools, one of which is in the hon. Member's constituency. I hope that the hon. Gentleman understands that that is as much as I can say: under section 37, governing bodies can appeal to my right hon. Friend the Secretary of State for Education against the suspension of delegation, and it would clearly be inappropriate in these circumstances for me to comment one way or the other at this stage on the action which the authority has taken.
As hon. Members will know, local education authorities have a great deal of discretion in how they arrange their local management of schools schemes. It is important to realise what LMS is about. Above all, it is not about the total of spending on schools; it is about the distribution of that expenditure—the balance between centrally retained items and funds delegated to schools, and the distribution of those delegated funds between individual schools. How much Warwickshire spends on its schools is a decision for the LEA, to be taken in the light of its other commitments, both in education and other services.
I note for the record, however, that, according to Warwickshire's LMS statement for 1995–96, the funding which schools are receiving in their delegated budgets amounts, on average, to £1,382 per pupil in primary and middle schools and £1,961 per pupil in secondary schools. Although we do not yet have comprehensive comparative figures across the country, it is safe to say that those are by no means the lowest in the country.
In any case, the amount which schools receive in their delegated budgets will depend—obviously—on what proportion of the available resources the authority chooses to delegate. I note that Warwickshire's 1994–95 budget statement indicated that the authority was planning to 577 delegate 85.7 per cent. of its potential schools budget—about 1 per cent. below the national average. For 1995–96, the percentage of PSB to be delegated has risen to 88.4 per cent., but am I advised that that is simply because the PSB has been redefined. If the effect of that is discounted, it looks as though the level of delegation in Warwickshire may even have fallen slightly.
As to the important question of Warwickshire's reorganisation proposals, I completely resist the hon. Gentleman's allegation of Government incompetence. I am sure that he will appreciate that as the proposals are currently before the Secretary of State for Education, I cannot comment on them in detail, school by school. The Secretary of State will consider the proposals on their merits, taking account of all views for and against those proposals and all the educational issues involved.
I appreciate that the uncertainty over the future of the schools affected by the proposals is causing considerable anxiety locally. As the hon. Member is aware, I have met a number of deputations expressing either support for or opposition to aspects of the proposals. I can assure the House that the proposals will be determined as quickly as is compatible with a full and careful consideration of the issues. The House might be interested to know that Warwickshire's proposals represent one of the largest reorganisation schemes to come before the Secretary of State. It affects 177 schools, while eight governing bodies have also published proposals for the acquisition of grant-maintained status. Seven of the GM proposals conflict with closure proposals published by the local education authority.
The Education Act 1993 requires the Secretary of State to consider the reorganisation proposals and the GM applications together, but she is required to reach a decision on the GM proposals, on their merits, first. That ensures, in practice, that both the GM and rationalisation proposals are properly considered. The hon. Member will understand that we owe it to the parents, pupils and teachers concerned to give those proposals our very closest attention. I submit that we cannot rush them.
Although there is no legal duty to consider statutory proposals within a set period of time, Ministers have, as hon. Members know, given a public undertaking, where possible, to reach a decision on most statutory proposals, including those published under sections 12 or 13 of the Education Act 1980, within five months of the date of publication. For some complex reorganisation proposals, like those from Warwickshire, a longer period may be necessary to allow Ministers to give full consideration to the proposals.
The hon. Member referred to the ruling of Mr. Justice Sedley on 12 April 1995 concerning the proposed closure of the Beacon special school in Walsall. In essence, it 578 said that, in fairness, interested parties should be given an opportunity to comment on new issues raised by Her Majesty's inspectorate in its advice to the Secretary of State on a statutory proposal. We are urgently considering the implications of the judgment for the Department's handling of statutory proposals, which includes, of course, the Warwickshire scheme.
Although I cannot supply an exact date as to when Ministers will determine the proposals, we hope to have the matter resolved, or all but resolved, by the end of next month. To put that in context, three months from the publication of the last of the GM proposals equals the date of 9 May. When the hon. Member looks at the dates, I hope that, on reflection, he will consider that the timescale is some way short of the imputation he made against the Department about unreasonable delay. In the meantime, I assure all parents and teachers whose schools are the subject of the proposals that I am well aware of the anxieties which they may currently feel. I shall seek to resolve all the outstanding issues at the earliest possible moment.
The hon. Member also argued that in order to allow the council to borrow sufficient resources to implement the proposals, its capping limit should be raised. If the statutory proposals are approved, the authority will receive extra SSA credit to reflect the cost of the reorganisation. The extra SSA credit does not, however, translate into extra spending power, just more revenue support grant. That is because Warwickshire is already spending above the level of its SSA, as the hon. Member implied. Capping rules are designed to bite on such authorities. Failure to relax the cap should not prevent the council from financing the costs of its reorganisation. Other councils, for example Leeds and Wakefield, have been able to carry out large-scale reorganisations, which remove surplus places, without receiving—
§ Mr. O'BrienWill the Minister give way?
§ Mr. SquireIn fairness to the hon. Member, I must finish my remarks. I am willing to take up other matters with him after the debate. I still wish to put certain facts on record in the last half minute left to me.
As I said, other councils have been able to carry out large scale reorganisations without a relaxation in their capping limits. May I add that capping remains necessary to ensure that all authorities play their part in the restraint of public expenditure.
§ The motion having been made at Ten o'clock and the debate having continued for half an hour, MADAM DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
§ Adjourned at half-past Ten o'clock till Monday 22 May.