HC Deb 15 July 1998 vol 316 cc411-25 3.31 pm
The Secretary of State for Education and Employment (Mr. David Blunkett)

With permission, Madam Speaker, I wish to make a statement on the impact of the comprehensive spending review on education and employment.

Yesterday's announcement by my right hon. Friend the Chancellor of the Exchequer heralds a new beginning for our schools, colleges and universities. This is a new contract for education—an investment on an unprecedented scale to deliver a step change in education standards nationwide. Every pound of new funding has been linked to demanding targets, including firm targets for mathematics and English, to drive up standards across the board. That settlement demonstrates the Government's commitment to fulfilling our pledges—investing in the future of our children and the employability and lifelong learning of our people. It allows us to modernise and renew our commitment to taking on the challenge of a new century.

In the years ahead, we intend to create the classroom of the future. Smaller classes and the expansion of modern technology to support learning will be matched by better motivated and more highly skilled teachers. The best will be rewarded, building on the new grade of advanced skill teacher, and we shall seek to recruit, retain and reward our teachers to match the task ahead.

The settlement will allow us to employ more classroom assistants to back up our teachers. We intend to improve dramatically the adult:pupil ratio in primary classrooms, to ensure that children have the attention that they need to succeed.

Since May last year, we have announced an extra £2.5 billion for education and £3.5 billion for the new deal programme for unemployed men and women. We are building on the progress made this year. From September, there will be lower class sizes for 100,000 pupils in infant classes throughout the country, a new literacy framework and an early years place for every four-year-old whose parents wish it.

We have made a good beginning, but I can inform the House that we shall do even better in the next three years. A flying start in life is crucial to success. That is why I am announcing a new initiative to link support for families and nursery education in providing a sure start for all our children. "Sure Start" will be a cross-Department initiative. Colleagues in the Department of Health and others will work with the Department for Education and Employment to provide comprehensive support for pre-school children who face the greatest disadvantage. It will include child care and play, primary health care, early education and family support. We are spending £540 million on "Sure Start" over three years, in addition to spending on our child care initiative.

Nursery education is the foundation of later educational success. I am pleased to announce that there will be an extra 190,000 nursery places for three-year-olds in England by 2002. That will double to two thirds the number of three-year-olds who have access to a free nursery place, and it is the first step towards ensuring universal provision for all three-year-olds whose parents want it.

We promised the voters that by 2002, no five, six or seven-year-old would be in classes of more than 30. That essential pledge is a key component in raising standards, and I am keen to make even faster progress. I am pleased to tell the House that the money announced by my right hon. Friend the Chancellor yesterday will enable us to achieve that pledge earlier. No five, six or seven-year-old will be in a class of more than 30 by September 2001. I can go still further. The resources available will enable local education authorities that wish to do so to fulfil that aim by September 2000—18 months earlier than we promised the electorate.

An extra £160 million will be available to adapt or build 2,000 extra classrooms, ensuring that we can underpin parental preference as well as deliver smaller class sizes. An extra 6,000 teachers will be employed to ensure that youngsters learn the basics. In total, we shall spend an additional £620 million between now and 2002, to deliver our pledge.

Not only our schools will gain; our universities and colleges will be winners. We have taken tough but fair decisions on funding for further and higher education. We did so to end the years of neglect that brought a 30 per cent. drop in funding for each higher education student over the Last seven Conservative Budgets. We shall carry through our promise to spend the money raised by our new student support arrangements on improving access to, and investment in, further and higher education. In 1999–2000 alone, there will be an extra £280 million for our universities, which is a 5.7 per cent. cash increase for higher education and includes £50 million for research. That will be in addition to the substantial sums announced by my right hon. Friend the President of the Board of Trade for research and science expenditure.

I am particularly pleased to announce an additional £255 million for our further education and sixth-form colleges, which is a cash increase for next year alone of 8.2 per cent. That will enable us to improve skill levels, and to increase rates for staying on at age 16. The real-terms increase in spending on education across the United Kingdom over the next three years will be almost 16 per cent.—an average of more than 5 per cent. a year. In cash terms, that is an increase of 25 per cent.

Our school system was failed by the Conservative party. During the 18 years that it was in power, it managed an average real-terms increase of only 1.4 per cent. a year. In the three years to 1997, it reduced the amount that it allocated in real terms to education year on year. Inevitably, class sizes rose year on year. Today marks the end of that sorry decline.

By contrast, we shall have allocated almost £10 billion by 2001. We shall double spending on capital investment over the Parliament: money for repair and modernisation and for classrooms fit to learn in. The sorry—the Tory Govemment—[Laughter.] The sorry Tory Government, in their final death throes, cut spending by £110 per pupil. Our spending proposals mean an increase of £300 per pupil next year over and above what the Conservatives would have spent had they won the Last general election. In the months and years ahead, the change will be clear for all to see in the fabric of our schools, in the professionalism and morale of our teachers and in the results achieved by our pupils.

This is an historic day for education. It is the largest and best settlement in any three-year period since the war. It will give every pupil and every teacher, every parent and every governor, the confidence that they need to deliver the high standards essential for all our needs and for a new millennium. We said that we would make education our top priority and that we would spend more of our national income than our predecessors on education. Today, we are fulfilling our promises. Tomorrow, we shall start to deliver the education service that Britain deserves.

Mr. David Willetts (Havant)

I congratulate the Secretary of State on his boldness and ingenuity in constructing very large figures for future spending, by counting absolutely everything together on top of the cash figures for this year—future inflation, three years' worth of raids on the contingency reserve, statistical changes all thrown together in one great hotch-potch. Will he confirm that using exactly his methodology, starting from one year's cash figures and counting everything else as an increase, the Conservative Government presided over increases in education spending that cumulatively totalled £250 billion since 1979? They totalled £26 billion since 1992.

Will the Secretary of State also confirm that, despite his pledge to increase the proportion of our national output that goes on education, it will take him four years to get back to the position that he inherited from us? He is running hard to stand still. In our last year of office, we devoted 4.9 per cent. of gross domestic product to education, although I notice that he has cut his estimate of that to 4.7 per cent. We understand that he wants to fiddle his own figures, but will he kindly stop fiddling ours?

The Secretary of State makes much play of getting to 5 per cent. of GDP in his fifth year of office, but the average over the lifetime of this Parliament will be 4.8 per cent. of GDP spent on education. The average during the five years of the previous Parliament was 5.1 per cent. We are talking not about unprecedented investment but about unprecedented hype.

The Secretary of State offered us a familiar List of the areas on which the money will be spent. He repeated yet again his pledge on class sizes. Was not it supposed to be an early pledge? Now we are talking about 2001. What does "early" mean in the lexicon of new Labour—2002? Does he accept that today's statement is the final admission that he cannot finance his class size pledge by the abolition of the assisted places scheme? His problem is that Large classes are often in the popular schools that get good Office for Standards in Education reports and to which parents want to send their children. Many such schools simply do not have the physical space to embark on large-scale building programmes. Will not his rigid commitment to his policy mean a reduction in parental choice? Why has he failed yet again to promise that he will not achieve his class size target at the expense of parental choice?

The Secretary of State talked about expanding provision in the early years, but is he aware that many independent and voluntary nurseries for four-year-olds up and down the country are closing as a result of his so-called expansion of education for four-year-olds, which meant public sector expansion at the expense of everyone else? Is not that just what he intends to do for very young children as well? Can he assure the 80,000 providers—

Mr. John Hayes (South Holland and The Deepings)

rose—

Mr. Willetts

I am asking the Secretary of State for an assurance on behalf of the 80,000 providers of 800,000 places for children aged up to four that they will not lose out to state provision in the same way as charitable and private providers of education for four-year-olds are already doing.

The Secretary of State was ingenious in his spinning before the statement today. We had in yesterday's edition of The Guardian the headline that I presume was meant for the teachers, "Extra funds for teachers and nurses". Then there was the headline in The Daily Telegraph, "Public sector workers face pay squeeze". Which headline was true? What are his intentions with regard to teachers' pay? He has been specific today about capital, but we have heard nothing but vague statements about pay. It is no good having shiny new classrooms if one cannot retain and recruit good teachers to teach in them. It is no good pandering to the Chancellor's obsession with physical construction and capital if one does so at the expense of the recruitment of good teachers.

How much of the extra money will reach the schools? We know from last year when the Secretary of State boasted of an extra increase in education expenditure of £800 million that only £500 million got through to the schools. The Secretary of State is loading more and more tasks on local education authorities and at the same time urging them to pass more money on to schools. How does he intend to ensure that that happens?

We have heard about more money for higher education. The Secretary of State spoke about £280 million going to universities in 1999–2000, but in that very same year students will lose grant worth £600 million and will face tuition fees of £250 million. The sum of £850 million taken from students is not matched by £280 million going into higher education.

We have the pledge of 500,000 more places in higher education and further education. There is no indication of where the places will be or how many will be in higher education. Will the Secretary of State confirm that many of the new places will be part time and that the full-time equivalents will be less than half of the 500,000 that he is talking about?

Everyone involved in education will of course welcome the increase in expenditure, as I do, but they will not welcome the Secretary of State's desire to interfere in every nook and cranny of what goes on in the schools, colleges and universities of our country. That is no way to raise education standards.

Mr. Blunkett

If I could glean the question, I would be well on the way to giving the answer. The truth is that the House will have realised that someone described as "two brains" must have lost one brain on the way here this afternoon—so much so that someone on the hon. Gentleman's own side tried to intervene on him even though he was asking a question.

I am not clear whether the hon. Gentleman is in favour of more spending on education or against it. The shadow Chancellor is against it; the shadow Secretary of State for Education and Employment appears to want more spending. He wants to accumulate the measly spending over 18 years and pretend that it matches ours over three years—1.4 per cent. real-terms growth over 18 years, which is matched by 16 per cent. real-terms growth in just three years. Everyone outside the House will be able to make a judgment of his own.

I did glean one question. It was about the GDP proportion, which works like this: under cash accounting, it is 4.7 per cent. rising to 5.1 per cent.; under resource accounting, which the Treasury now uses, it is 4.6 per cent. rising to 5 per cent. I hope that that helps the hon. Gentleman to work out the difference. Of course, the increase in GDP by 1992 was achieved on the back of one of the worst slumps that this country has had since the second world war. Anyone who knows anything about economics knows that the ratio of GDP goes up as, regrettably, growth slows and goes down.

Let me answer some of the questions that I gleaned in respect of what is described as an early pledge. An early pledge is 2000 rather than 2002. An early pledge for five, six and seven-year-olds is a pledge that we made but which the Conservative party never intended to make and would never have made, even as class sizes rose year on year. Of course there will be choice: I made it clear in my statement that parental preference will be taken into account, and that is why we are investing additional cash.

The most breathtaking point posed was the issue of teachers' pay. Who was it who got into a terrible mess over pensions, which accelerated the drain away from the teaching profession? Who was it who drove teachers by the thousand out of a profession of which they should be proud? Let me make it clear again this afternoon: we wish to recruit, we wish to retain, we wish to reward and we wish to motivate. We shall do so by working out with the profession a way in which we can ensure that performance is applauded, that cash is available for those who need it, that we can retain good teachers in the profession and that we can have the sort of standards that were never possible under the Conservative party.

Ms Margaret Hodge (Barking)

May I warmly welcome today's statement by my right hon. Friend the Secretary of State and congratulate him on having secured such a high proportion of the additional resources for expenditure? Will he tell the House what steps he is taking to ensure that the money for schools actually goes through to the institutions themselves?

Mr. Blunkett

That is a crucial question, in view of the experience over the past year and the indications that there are authorities that are saying that they are not prepared to go along with the priorities laid down by the Government. One of the ways in which I should like to achieve what my hon. Friend asks is by asking the hon. Member for Havant (Mr. Willetts) and representatives of the Liberal Democrats to join me in writing to every leader of every council and every chair of education saying that, now that the resources have been found and the money has been allocated, they will back me in ensuring that their councillors as well as mine carry that money into every school and every classroom in the country.

Mr. Don Foster (Bath)

Unlike the hon. Member for Havant (Mr. Willetts), who seems completely blind to a good deal for education, may I genuinely congratulate the Secretary of State and applaud his statement today? Does he find it somewhat odd that the hon. Member for Havant cannot find a single thing in the statement to welcome? Perhaps the hon. Gentleman finds it difficult to welcome the significant improvement in early years education, given the mess that the Conservatives made with nursery vouchers, but he could at least have welcomed "Sure Start", as I do.

In view of the answer that the Secretary of State gave to the hon. Gentleman, does the right hon. Gentleman accept that, if we are to have the high-quality education that both he and I want, we shall have to have a sufficient number of high-quality teachers, so we shall have to improve the pay and conditions package for the vast majority of teachers and not only for the few super teachers? Does he also accept that there is a need to further his attempt to reduce bureaucracy for teachers, by increasing the number of ancillary assistants in schools? Can he confirm that that is included in the package?

Mr. Blunkett

On the last point, I am happy to confirm that the programme that we are laying out will include teachers' assistants, ancillary and non-teaching staff in the team that makes up the delivery of the education service. Our bureaucracy working party, which has now been welcomed by all the teachers' unions and is already working, will make a difference.

Of course it is necessary to pay teachers well. We have to balance the inflationary pressures that are evident in today's statistics relating to the private sector with the need to reward teachers well and keep them in the classroom. The development of our programme, "Something for Something", will be a crucial part of solving that equation.

Mr. Gerry Steinberg (City of Durham)

Today is certainly an historic occasion. Is my right hon. Friend aware that this is the first time in the 12 years that I have been in the House that I have been able to congratulate the Government on increasing spending on education? Is he further aware that over a year ago I said in the House that I did not believe that the amount of money that would be saved from the assisted places scheme would be enough to pay for reducing class sizes and that more money would have to be found? I am delighted that the Secretary of State has taken my advice on that issue.

I apologise for going over this matter again, but my right hon. Friend is aware that I have been deeply involved with the National Union of Teachers for many years and that miserly awards were granted by the previous Government. Will my right hon. Friend guarantee that, out of the money that is being made available for education, schoolteachers will get the increases in their salaries that they richly deserve and have not received for nearly 20 years?

Mr. Blunkett

I am genuinely pleased to bask in the congratulations of my hon. Friend, particularly because they come so rarely to me, and I am grateful. I confirm that there have been unfortunately low settlements, but there has also been a disparity year on year and a lack of continuity and consistency. If, with a three-year settlement, we can gradually build up over the next three years to achieving our goals, not only in rewarding teachers but in investing to enable them to do their job better, we shall receive the applause of parents and teachers at the end of that period.

Mr. David Curry (Skipton and Ripon)

Will the Secretary of State confirm that the private finance initiative will still play a crucial role in providing new schools and that his package will enable that initiative to be accelerated? Will he further confirm that a new list is due to appear this month and—the Minister for School Standards is whispering to him, with my approval—does he recognise the importance of the North Yorkshire primary schools that are candidates for that list, given that it would be the first time that Church schools were included in the PFI?

Mr. Blunkett

I can confirm that my hon. Friend was whispering in my ear, but I cannot confirm what he was whispering. I can, however, confirm that there will be a minimum of £350 million a year of PFI credits and that within the next few weeks we shall consider the distribution of those resources.

Dr. George Turner (North-West Norfolk)

My right hon. Friend will know that in Norfolk, where we were particularly pleased to hear the death knell called on the nursery voucher, people will welcome the advance in nursery provision for three-year-olds. How will that be phased and what steps will my right hon. Friend take to ensure that the difficult rural areas, which present different problems for nursery education, are treated equitably with areas where it might be physically easier to introduce the new programme?

Mr. Blunkett

It is important that we correctly implement that policy in rural areas. As my hon. Friend will know from his time as chair of education in Norfolk and in the House, we have introduced ways in which we are supporting and encouraging collaboration between the different sectors. The early years partnerships are already playing a significant role in engaging voluntary as well as private and statutory provision, to make it possible imaginatively to deliver the programme.

In rural areas, we need to use imagination, so that we can provide services on a peripatetic basis and encourage, as we are doing in urban areas, the integration of nursery education and child care. The "Sure Start" programme, which is very close to the heart of my hon. Friend the Minister for Public Health, will be developing, and we shall be able to illustrate over the weeks ahead how that will integrate imaginatively with health provision, including health centres, GP practices and post-natal provision, and break down the barriers between the different approaches to the family and the child in the crucial early years.

Mr. William Ross (East Londonderry)

Given the amount of substandard accommodation and accommodation in need of repair that is in use throughout the nation, and presuming that Northern Ireland will also receive a doubling of the sums to be spent on refurbishing, repairs and rebuilding, what is the Secretary of State's time scale for ensuring that all school accommodation attains a proper standard?

Mr. Blunkett

I can guarantee a doubling of expenditure by the end of the three-year spending review, but I cannot guarantee that every school in every part of the United Kingdom will have reached the standard that the hon. Gentleman and I would like them to achieve. I hope that we shall get very close to attaining that standard. I hope that the combination of measures that we have announced, including the development of spending on the learning grid, will enable us to bring our schools to a standard of which every parent can be proud.

Mr. Andrew Miller (Ellesmere Port and Neston)

Will my right hon. Friend ensure that, as part of the programme, there is adequate co-ordination with other Departments? The programme at Wolverham school in my constituency engages adults in adult learning and enables them to participate in the new deal arrangements. That imaginative programme is particularly important for schools in poorer communities. We must ensure that there is maximum collaboration between all agencies, so that we continue to get the best value for money.

Mr. Blunkett

I could not agree more. I make it clear that the resources being allocated, including resources that we want to target on what is known as non-schedule 2 adult education, will be crucial to giving people new access to further and higher education. The agenda set out by Baroness Kennedy and Professor Fryer will be close to the hearts of all of those who want to overturn exclusion and ensure that there is an inclusion agenda for further and higher education and for lifelong learning.

Mr. Hayes

I thought that I should ask one of my own questions instead of trying to intervene upon my hon. Friend the Member for Havant (Mr. Willetts).

Will the Secretary of State confirm that he has assessed the impact on the potential increase in teachers' pay of inflation and the cost of the standards fund? The LEAs in Labour-controlled Nottinghamshire and Conservative-controlled Lincolnshire are telling teachers, parents and governors that the increases in the past year about which the Secretary of State has spoken so grandly have not had an impact in the classroom because those issues have affected the amount of money reaching schools.

Mr. Blunkett

I make it absolutely clear that the contribution of 50 per cent. from central Government—which will ensure that the literacy programme and other essential initiatives that raise standards are carried through in the classroom—is a promise, not a threat. I believe that giving local authorities 50 per cent. more than they would have received in order to do what they should already be doing is a very good deal.

If Lincolnshire had passported the money to the education service, which could have then passported it to schools, we would not have the disgraceful picture of such low allocations. That shows what the Conservatives think about when they allocate money to education. Lincolnshire county council under the Tories has mirrored the miserly and measly allocations that central Government under the Tory party gave to the nation as a whole.

Mr. Derek Foster (Bishop Auckland)

Does my right hon. Friend agree that the churlish and mean-spirited diatribe from the Opposition Front Bench explains why hon. Members on the Tory Benches look as sick as parrots while everyone on the Labour Benches looks over the moon? May I congratulate the Secretary of State on achieving 5 per cent. per annum real growth in education and employment spending? That allows the most challenging of our election pledges to be fulfilled—that is, increasing the proportion of gross domestic product spent on education over time. I now urge my right hon. Friend to give equal focus to dealing with the productivity gap that the Chancellor has identified as being crucial to the success of the Government's economic and financial strategy. Will my right hon. Friend give to that objective the same focus that he is giving to the schools agenda?

Mr. Blunkett

I cannot confirm the health of the parrots, but I did hear one fall off a perch, so nailing them to it is obviously the task. The issue that my right hon. Friend has raised is important. I believe that, with the active work of the Education and Employment Committee, we shall be able to make progress in that area.

Mr. Peter Viggers (Gosport)

May I draw on my experience as chairman of the governors of St. Vincent sixth-form college in my constituency to express regret that there was only a passing reference to sixth-form colleges in the Secretary of State's statement? Does the Secretary of State agree that sixth-form colleges have used their independence under the Further Education Funding Council extremely well, making considerable improvements in efficiency? Does he agree, however, that sixth-form colleges receive only 80 per cent. of the amount per student received by neighbouring sixth forms? What does he propose to do about that?

Mr. Blunkett

I intend to do a damn sight more than the previous Government did. I am genuinely mindful that there is a disparity, and that sixth-form colleges are delivering high-quality, high-standard education with lower allocations. The 8.2 per cent. cash increase for further education is crucial to helping us narrow that gap. However, I also intend to establish a standards fund for further education, which will assist with sixth-form college provision, and I wish to talk to the Local Government Association about how we, over a long period, can narrow the gap between the amount of money that goes into sixth forms and the amount that goes into sixth-form colleges, without in any way threatening existing provision for sixth forms.

Judy Mallaber (Amber Valley)

Will my right hon. Friend comment on the difference between a local practical reality and Conservative Members' rhetoric? Can he confirm that Ministers have recognised that it is as a result of the failures of the Conservative party over the past 18 years that my county of Derbyshire has suffered so severely? Can he also confirm, and accept my congratulations on it, that a token of the early pledges that are being implemented is that, as a result of that recognition, in Derbyshire the number of infants in classes of more than 30 will next year decrease from the scandalous figure of 13,000 to 1,000? Does he agree that another token of the early pledges is that six—yes, six—schools in my constituency with outside toilets are to have them removed? Does he further agree that that was the legacy of failure that the Conservatives left us?

Does my right hon. Friend accept that there will be problems in providing buildings to accommodate the extra classes that will be produced by the reduction in class sizes? Does he agree, however, that, with the ingenuity, flexibility and co-operation with their schools of county councils such as Derbyshire while the buildings problem is being tackled, that problem can be solved if there is good will and determination?

Mr. Blunkett

I am grateful to my hon. Friend. I believe that the determination and the will of Derbyshire county council will bear fruit from this September, as my hon. Friend described; obviously, the £1 million revenue that we have allocated is being used effectively and wisely. We obviously recognise that, as I said in my statement, capital is crucial to delivery. That is why, of the £620 million announced, £160 million of capital will be earmarked specifically for use in tackling that problem.

Mr. A. J. Beith (Berwick-upon-Tweed)

Does the Secretary of State recognise that, although the extra resources will be very welcome in Northumberland, even the Labour-controlled local education authority would want me to remind him of the huge disparities that the standard spending assessment system creates? Under that system, whereas the equivalent of £1,800 is spent on each secondary school child in Northumberland, £3,200 is spent on each similar child in Kensington and Chelsea. Does he realise how important the review of that system is? The amounts produced today, valuable though they are, will not fill that gap.

Mr. Blunkett

The right hon. Gentleman will be very pleased to hear that I agree with him. A situation that results in Torbay being regarded as more deprived than Sheffield is bound to get my gall up. We do need to tackle that problem. However, the questions asked in Prime Minister's questions this afternoon illustrated what a long, hard and difficult haul it will be to redistribute resources. Although one authority may receive £1 million more for a single secondary school than another authority receives for a school in a different part of the country, the former will not want those resources to be removed. Consequently, increasing resources and distributing fairly must go hand in hand.

Mr. Kevin McNamara (Hull, North)

My right hon. Friend will not be aware that I spent my constituency week visiting schools in my constituency—both those within and those without the education service. I can assure him that his statement this afternoon was eagerly awaited, and its contents will be greatly welcomed by all the teachers whom I met. Of the great sums that he announced today, can he tell us what percentage and, in absolute terms, what sum will go in increases for teachers and ancillary staff in schools, so that they will know that if they give something, they will be properly rewarded? As far as I am concerned, all my teachers are super teachers.

Mr. Blunkett

I thank my hon. Friend for that question. We are committed to retaining the School Teachers Review Body, and we are committed to its independence. We shall submit evidence to it in due course that will outline for the year ahead, and I hope on a three-year basis as well, how we intend to meet the challenge of balancing inflationary pressures and the necessary rewards for high performance. I am sure that my hon. Friend would not expect me to pre-empt the School Teachers Review Body report even before I have submitted the evidence to it.

Sir David Madel (South-West Bedfordshire)

How will the Government find the extra teachers for their expansion plans, when they have announced a tightening of the guidelines for pay review bodies, which decoded means that teachers' remuneration will become less attractive to potential new recruits?

Mr. Blunkett

I have not decoded our announcement in that way. I have decoded it as placing emphasis on reward and retention, morale, and ensuring that we can recruit and retain the highest level of graduates into the profession. We want to attract into the teaching profession not just new entrants from university taking the postgraduate certificate in education, but people with life experience. We want them to come back in, recognising the part that they can play and being well rewarded for it.

Mr. Gordon Marsden (Blackpool, South)

Will my right hon. Friend accept particular congratulations on the extra £250 million that is going into further education? That is a good riposte to the excellent Select Committee report that has just been produced. I know that the further education college and sixth-form college in my constituency will be especially grateful. Over the next three years, will my right hon. Friend also look closely at the way in which the further and higher education sectors co-operate? If the target of an extra 500,000 students is to be reached, there must be the closest co-operation because, as many of us know, people start in FE and progress to HE later.

Mr. Blunkett

I can confirm that co-operation is important. Lord Dearing's report placed emphasis on the development of sub-degree higher education courses. We should see how further education can play its part in linking initial access, level 2 and level 3 qualifications and higher education. That is an important part of creating a ladder of learning, so that lifelong learning means exactly that.

Mr. Nick St. Aubyn (Guildford)

Lord Dearing's report placed great emphasis on retaining the student grant. Does the Secretary of State have anything to say about the fact that in the year to 2000, his proposals will take £600 million out of the pockets of the neediest students and not put a penny of that money back, even into higher education?

Mr. Blunkett

I cannot confirm that. It seems to have escaped the hon. Gentleman that in the current year, from this autumn, under present cash accounting systems, we are paying out the money to ensure that students do not lose out in the coming year. They will, of course, be paying back over time. We have about £200 million in the coming year from the independent fee contribution. That is all the new money from the changes in the coming year. We are more than matching that with the £280 million that I announced this afternoon, and with the massive investment in research and the science base of our universities, from which all our universities will gain enormously.

Mr. Tam Dalyell (Linlithgow)

I welcome the £50 million for research, but can the Department do something about the problem of short-term research contracts? Researchers are living from hand to mouth, and cannot produce their best science. May I be forgiven a naughty question? What on earth were we all doing on Monday in this place at midnight?

Mr. Blunkett

The answer to my hon. Friend's second question appears to be, "Playing silly so-and-sos," but I am delighted that we reached a sensible solution, and I thank all who helped that solution on its way. As for the first question, I believe that there is a genuine problem in regard to short-term contracts. The introduction of such contracts was a feature of the current instability. I hope that, as we develop a three-year funding regime by means of the dual system involving the Science and Engineering Research Council and the Higher Education Funding Council, we shall be able to introduce more stability and consistency, enabling people to take on researchers and research assistants under a more equitable and acceptable contract system.

Mr. John Greenway (Ryedale)

I assure the Secretary of State that I shall encourage North Yorkshire county council and City of York council—as I always have—to spend on education whatever money he passports to them. However, this year's increase in the education budget meant a 14 per cent. council tax increase in North Yorkshire. What increases will be necessary in future to fund the extra expenditure that the Secretary of State has announced today?

Will the right hon. Gentleman also assure us that, in rural areas, the class size limit of 30 will not be imposed so rigidly that young children will be required to travel long distances to school?

Mr. Blunkett

All the money that I have announced is allocated from central Government. Obviously, local government will also contribute resources raised through the council tax, with which my right hon. Friend the Deputy Prime Minister will deal separately.

As for class sizes in rural areas, my hon. Friend the Minister for School Standards has made it clear on several occasions in the House that we seek to ensure that children need not travel unacceptable distances so that the class size pledge is met.

Helen Jones (Warrington, North)

I warmly welcome my right hon. Friend the Secretary of State's announcement of the "Sure Start" programme, which will help to break the cycle of poverty and deprivation, which means that many children will fail before they even start school. I know that the programme will also be welcomed by many schools in my constituency that must deal with the consequences of the failure to give children a proper start in life.

Will my right hon. Friend tell us a little more about the programme? How will it be targeted towards the most deprived areas, where it is most needed?

Mr. Blunkett

I thank my hon. Friend for her support. We are beginning a long-overdue process of getting people to work together closely at local level, and it is from such local partnerships that programmes such as this should grow. There will be an inter-ministerial group. Such a group already exists, chaired by my hon. Friend the Minister for Public Health. She, along with Ministers from my Department, recommends to me the direction in which we should go—targeting resources, but also ensuring that we can back the imaginative programmes that have already been started with health visitors, school nurses and the development of primary health care practice, linking all that with child care and nursery provision and extending the early excellence centres so ably fostered by the Under-Secretary of State for Education and Employment, my hon. Friend the Member for Birmingham, Yardley (Ms Morris).

Mr. Phil Willis (Harrogate and Knaresborough)

I join my hon. Friend the Member for Bath (Mr. Foster) in congratulating the Secretary of State on securing such a good deal from the Chancellor. I particularly welcome the money that is going into universities, and the additional £1.1 billion announced yesterday by the President of the Board of Trade.

I am sure that the Secretary of State will agree that, for universities and colleges, one of the great injustices of past years has been the per capita funding decrease. That has continued year by year, certainly for the past 10 years. Will the right hon. Gentleman assure us that the figures that he has announced, and his plans for the period up to the end of this Parliament, will involve a per capita increase in spending on both further and higher education that is above the rate of inflation and will provide colleges and universities with genuine new money and security?

Mr. Blunkett

The genuine money is there. It is committed. We are combining increased access with a reinforcement of quality. I mentioned the standards fund that I intend to establish for further education. The real-terms increase for further education will be 5.5 per cent. and that for universities will be 3 per cent.

Mr. Derek Twigg (Halton)

I congratulate my right hon. Friend on his announcement and particularly welcome the extra funding for further education. Widnes sixth-form college in my constituency suffered a 25 per cent. cut in its resources under the policies of the previous Government, so the announcement will be particularly welcomed there. Will not his announcement also be recognised as a confirmation of the importance of the FE sector in increasing skills, competitiveness and training in the economy?

Mr. Blunkett

I hope that it will. Further education, including sixth-form colleges, has been the Cinderella of the education service. It has been neglected by the media and by politicians—not by Labour Members, but certainly by the previous Government. In allocating resources this year and for the following two years, I want to ensure that those who write and comment on politics and education who have never had experience of further education are not allowed to get away with it any longer. The crucial role of further education in skilling our people and in giving access to the disadvantaged must be recognised, so that we can put it on a par with the areas of education that receive greater attention.

Dr. Brian Iddon (Bolton, South-East)

May I welcome the extra £50 million for university research, along with all the other money that has been announced this week? About 12 universities spend about 50 per cent. of this country's research investment. Does my right hon. Friend agree that his announcement will give an opportunity for extra money to trickle down into universities whose research departments have been struggling in recent years?

Mr. Blunkett

It will make an enormous difference. In our allocations to the research councils and the Higher Education Funding Council, we must ensure that the next research assessment exercise is fairer and more equitable than the last.

Mr. Barry Sheerman (Huddersfield)

A hard-bitten and cynical vice-chancellor to whom I spoke this morning said that he felt like rushing outside and dancing in the street after hearing about the treatment of the higher education sector. I congratulate my right hon. Friend on the vast increase in the resources going to higher education in particular, but does he accept that that is only half the battle? Money can still be frittered away. Poorly performing schools, departments or colleges can waste money as well as using it well. Will he redouble the Government's efforts to learn from best practice and reward productivity, good management and leadership, to ensure that the money is well spent every day and every month until we get the results that we all want?

Mr. Blunkett

I respect my hon. Friend's long-standing commitment. I believe that we should do that because value for money in every area is critical. The picture of a vice-chancellor dancing in the street intrigues me. If my hon. Friend can get the Committee of Vice-Chancellors and Principals to agree to dance with him, we shall all have a barney in Parliament square that will set the world alight once and for all.

Miss Melanie Johnson (Welwyn Hatfield)

I recently visited the nursery at the YMCA in Welwyn Garden City. The staff there will be delighted by this afternoon's announcement. They told me that they wanted their work to be celebrated more by the Government. Today's announcement gives a clear message to all the staff working in the under-five sector about the value that the Government place on their work. I hope that my right hon. Friend will endorse those comments.

I am slightly concerned about work with pre-school playgroups. I know that, through partnerships and additional funding, we have ensured that the fall-out from the Conservatives' nursery voucher policy has been minimised. Will my right hon. Friend say a few words about how he will continue to ensure that the voluntary pre-school sector will help to contribute to our many achievements in under-five provision as a result of today's announcement?

Mr. Blunkett

Yes; as I said earlier, early years partnerships are vital. The Under-Secretary of State, my hon. Friend the Member for Yardley, will not approve early years partnership programmes unless they are collaborative and meaningfully involve the voluntary and private sectors. As my hon. Friend the Member for Welwyn Hatfield (Miss Johnson) will know, we have allocated additional resources this year to protect viable and flourishing playgroups. We are in discussion at the moment on ensuring that allocation is transparent and fair. I am very keen to ensure that the Pre-School Learning Alliance and similar groups can play an essential part in encouraging their members to be part of the partnership and to make imaginative and flexible provision on the ground, which involves parents. The great advantage of "Sure Start" is that it links the parent and the needs of the child. There is no more obvious example of that than Pre-School Learning Alliance activity, in which parents are part of the process and of the solution.