Jacqui Smith (Minister of State (Schools and 14-19 Learners), Department for Education and Skills; Redditch, Labour)

I beg to move amendment No. 107, in schedule 2, page 114, line 16, after ‘paragraph' insert

‘, other than proposals to which paragraph 10 applies,'.

Christopher Chope (Christchurch, Conservative)

With this it will be convenient to discuss Government amendments Nos. 108 to 127.

Jacqui Smith (Minister of State (Schools and 14-19 Learners), Department for Education and Skills; Redditch, Labour)

These amendments are intended in the main to correct technical drafting flaws in the Bill and in some cases to preserve and clarify its original intention. I will provide the Committee with a brief overview of their effect, dealing first with the purely technical amendments.

Amendments Nos. 108, 112, 119, 121, 122, and 127 are designed to correct and clarify cross-references in the Bill to other legislation, including references to other sections of the Bill and to the Learning and Skills Act 2000.

The other main “sub-group” is amendmentsNos. 110, 111, 113, 120, 123, 124, 125 and 126.They are all designed to clarify at various points in the schedule that the requirement to link proposals for consideration, determination or referral to the adjudicator applies only when those proposals are yet to be determined.

Amendments Nos. 117 and 118 will widen the circumstances in which prescribed bodies such diocesan authorities, promoters of new schools and, in some circumstances, the governors of a school or the Learning and Skills Council may refer an objection to a local authority's decision on proposals to the adjudicator. As the Bill stands, such objections may be referred only when proposals have been rejected, which could mean that there would be no mechanism for appeal if a local authority approved proposals for an independent school to join the maintained sector despite concerns about the impact on community cohesion. The amendments change the wording so that objections may also be referred when proposals have been determined.

We are also allowing the local authority to comment on proposals when they are referred. That was always the original intention of the legislation, as was indicated in the White Paper, which made it clear that providers who were dissatisfied with a local authority decision would be able to appeal to the schools adjudicator. Amendments Nos. 117 and 118 fulfil that commitment fully.

Amendment No. 107 is designed to clarify the intention when a local authority is required torefer proposals to the schools adjudicator. As the  Committee will be aware, when proposals are referred, the local authority has no role in determining them. Amendment No. 107 makes it clear that the local authority will not be expected to undertake any consideration of such proposals.

Amendment No. 109 corrects an original intention of the legislation. As the Bill stands, regulations would prescribe the changes that local authorities may make to proposals before they are determined. We do not think it necessary to prescribe such changes, because local authorities must be given the freedom to consider and respond to differing local circumstances and concerns. The amendment therefore removes the reference to prescribed alterations.

Amendment No. 114 removes the requirement on a local authority automatically to refer its own proposals to discontinue a school to the schools adjudicator if objections are received from any party. If this amendment is not made, the net result could be a massive and unacceptable burden on the schools adjudicator, as most proposals would be likely to end up at the adjudicator's door. Our intention was always that proposals should be referred only at the request of the types of organisation that I mentioned earlier—for example, those represented on the school organisation committee. The amendment corrects the Bill to achieve that intention.

Amendment No. 115 provides for regulations to allow that where a local authority refers to the adjudicator its own proposals or those concerning a trust in which it has a minor interest, objections to those proposals may also be referred.

I hope that members of the Committee agree that the amendments are helpful not only in tidying up some of the current drafting in the Bill, but in making our policy intentions clearer in some areas and providing useful additional provision in others.

Nick Gibb (Shadow Minister (Schools), Education; Bognor Regis & Littlehampton, Conservative)

I am delighted that some of the amendments take us back to the vision of the White Paper, which is the driving force behind most of our amendments. However, I have a few points to raise regarding amendments Nos. 109, 114, 117, and 122.

The Minister explained that amendment No. 109 does not correct a drafting error. I assume, therefore, that the phrase “of a prescribed kind” in paragraph 8(4)(c) of the schedule was originally intended to be included, as I would have expected, so that where schools are established under the procedures inclauses 9 or 10—that is, outside a competition—local authorities’ powers to alter proposals would be more limited than with proposals under clause 7, which involves proposals that local authorities have invited. If that is the case, why has the Minister changed her position? Why does she now want to give local authorities more say over proposals for new schools that they might not have had any involvement in initiating, unless the procedure was according toclause 9(1), in which case they would have to seek special permission to initiate from the Secretary of State? A response to that point would be extremely helpful.

Will the Minister confirm that the effect of amendment No. 114 together with amendment No. 117  would be to prevent the objections to school closures of people other than those listed resulting in a referral to the schools adjudicator?

On amendment No. 122, will the Minister explain why paragraph 14 of the schedule will not be included in the amended list in paragraph 18(3)(a)?

Sarah Teather (Shadow Secretary of State for Education and Skills, Education & Skills; Brent East, Liberal Democrat)

If I may do so with your agreement, Mr. Chope, I shall make a couple of brief comments on the amendments before making general comments on part 4 of the schedule, rather than speak in the debate on clause stand part.

Christopher Chope (Christchurch, Conservative)

That seems very fair.

Sarah Teather (Shadow Secretary of State for Education and Skills, Education & Skills; Brent East, Liberal Democrat)

Thank you, Mr. Chope.

I welcome the fact that the Government are giving more freedom to local authorities, as amendmentNo. 109 does. I have some queries about part 4 of the schedule. Have the Government considered the possibility of transferring assets to a trust with a leasehold rather than with a freehold? That would partly deal with the concern of many hon. Members that a trust might damage the value of an asset and prevent a local authority from having any overall strategic management of it. It would ensure that, if any serious alterations to the building were needed, the trust would have to notify the freeholder before making them. It would allow some element of protection.

Will the Minister confirm that playing fields are excluded from being transferred to prevent their sale and their loss to an area?

It is not clear to us why, as set out in paragraph 28(4), the local authority should pay the costs of a transfer to a trust. Will the Minister clarify the intention behind that? When any other asset is sold, the person buying or gaining it would pay the costs. The local authority may incur considerable costs.

Jacqui Smith (Minister of State (Schools and 14-19 Learners), Department for Education and Skills; Redditch, Labour)

I shall first answer the points madeby the hon. Member for Bognor Regis and Littlehampton. I will look carefully at what he said on amendment No. 109, but I do not necessarily accept his interpretation of it. It relates to the extent to which a local authority can modify proposals when making a decision on them. The amendment will mean that such modification does not need to be constrained to a prescribed alteration. A local authority will not be able to make radical changes; the intention is that the shape of the original proposal must remain but that there should not be artificial restrictions on the nature of the modifications that a local authority can make.

On amendment No. 114, if the hon. Gentleman was asking me whether it would limit those who could require a local authority to refer to an adjudicator, the answer is yes, as I spelt out in my earlier comments. As originally drafted, the implication of the Bill was that if there were any objection to a proposal it would have to be referred to the adjudicator. That was neither the policy intention nor the current position, and no member of the Committee would think that a proportionate approach. Our proposal is that those  who are currently represented on the school organisation committee, for example, would maintain their ability to refer proposals for adjudication.

I am afraid that I slightly lost track of the last point that the hon. Gentleman raised, but I will write to him with a response.

The hon. Member for Brent, East (Sarah Teather) referred to part 4 of the schedule. I can perhaps provide her with some reassurance. The guidance that I have issued alongside clause 34—I think that it has been sent out to members of the Committee—spells out in detail the different circumstances of the transfer of assets when a school takes on foundation status, the various protections afforded to both the school and the local authority and the adjudicator’s role in mediating in certain circumstances; for instance, if there is disagreement about the nature of the land to be transferred.

On the point that the hon. Lady made about leasehold, the disadvantage of negotiating potentially 24,000 different leasehold agreements is that it would be time-consuming, burdensome and bureaucratic. We believe that the transfer of freehold, the protections outlined in schedule 4 and the guidance to which I have referred are the most effective ways in which we can ensure what I think she is getting at—the suitable protection of publicly funded land. I think that if she looks at the guidance and the schedule, she will see the sort of protections that we envisage.

Finally, I can reassure the hon. Lady, not on her specific point, but with respect to playing fields, that there is nothing in the legislation or the transfer of assets that would undermine the protection of playing field land put in place by—if my memory serves me right—section 77 of the School Standards and Framework Act. Under the Bill before us, that protection will remain in place. With those reassurances, I hope that hon. Members will feel able to support schedule 2.

Nick Gibb (Shadow Minister (Schools), Education; Bognor Regis & Littlehampton, Conservative)

I beg to move amendment No. 56, in schedule 2, page 117, line 42, at end insert—

Jonathan R Shaw (PPS (Rt Hon Ruth Kelly, Secretary of State), Department for Education and Skills; Chatham & Aylesford, Labour)

Hear, hear!

Nick Gibb (Shadow Minister (Schools), Education; Bognor Regis & Littlehampton, Conservative)

The hon. Gentleman says, “Hear, hear!” about that provision. When we discuss school organisation committees, we will come to a provision that the hon. Gentleman will no doubt regret, also established under that Act.

Under current legislation and this Bill, there is no right of appeal for such decisions. The only recourse for aggrieved parties is the costly and limited judicial review process. A judicial review of a decision by a school adjudicator can cost about £50,000 or £60,000. The Bill before us extends significantly the powers of the school adjudicator, and we believe that natural justice requires that there be an appeal process from those decisions. We have opted for that appeal to be to the Secretary of State, who is, of course, accountable to Parliament and the electorate.

There is a concern that the school adjudicator and his regional representatives are very much part of the education establishment, which is responsible forthe current problems in our education system and under which a quarter of secondary schools are underperforming. There is a concern also that in reality they are not as independent as they were established to be. In their seminal work for Policy Exchange: “More Good School Places”, James O’Shaughnessy and Charlotte Leslie wrote that,

“although the Adjudicator is supposed to be independent, it is unfortunately not always so, as Rose Bugler from the Lowick Primary School in Cumbria explains”.

Cumbria education authority wanted to close the Lowick school. Rose Bugler said:

“The LEA said to us that they had decided early on that there was no need for any new schools in the county. End of story.”

She went on to say:

“We finally got to the Adjudicator, who we thought would be independent. However, the Adjudicator has to take note of what the LEA says and of course that must be the ‘truth’. It was all tied up in political knots.”

O’Shaughnessy and Leslie provide other examples of the adjudicator’s decision making that demonstrate why it is crucial for there to be an appeal process against his or her decisions. They cite the example of Brighton and Hove Montessori school, a not-for-profit independent school. For 12 years, it had been trying to become the first state Montessori school in the United Kingdom. In 2004, the Department for Education and Skills approved its capital funding bid to buy land and to build a voluntary aided school. Because it was a voluntary aided school, the school had to find 10 per cent. of the capital. As O’Shaughnessy and Leslie comment,

“Initially, the local authority, Brighton and Hove City Council, supported their bid but, despite the DFES’s enthusiasm, soon became far less co-operative.”

The Brighton and Hove school organisation committee refused the application for voluntary aided status on five grounds and the school appealed to the schools adjudicator. The grounds for the objection were: the educational standards of the proposed school; the source of the capital funding; the fact that there were surplus places in the area; a lack of parental demand; and the school’s unhappiness with the admission arrangements. To counter those criticisms, the school pointed out that surplus places cannot be used as an argument in rejecting an application by a proposer where there is a strong case based on parental  preference and standards. The school had a full waiting list and a 700-name petition calling for it; it had followed the advice of the admissions team at the DFES; and its Ofsted reports were good.

The adjudicator found against the school on the capital funding issue. The DFES guidance prevented him from approving the bid on the condition of the remaining funding being found. Meanwhile, the LEA’s opposition to the school had discouraged the bank, with which the school had been negotiating for the other 10 per cent., from approving the loan. The bank was unwilling to go ahead without a more positive input from the LEA. It became a vicious circle. DFES guidance states that the presumption should be to approve a new bid. The grounds on which the bid was contested were very dubious, and the decision of the adjudicator was predicated on caution and maintaining the status quo. In his conclusion to the case, the adjudicator said:

“It is not...possible to be certain that present qualities” —

the high quality of education provided when the school was in the independent sector—

“would apply to the proposed school. I must if anything err on the side of caution.”

In a statement echoing the attitude of the Deputy Prime Minister to this Bill, he said that, with its new facilities, the new maintained school

“might prove attractive to more local families who might indeed find places to be available. If that were to be the case, then the anxieties expressed by the LEA, schools local to the proposed site and other objectors would prove to be well founded.”

The report demonstrates the challenges faced bypromoters in establishing new schools. Where promoters face opposition from existing schools and the LEA, they can find it difficult to proceed. The adjudicator in that case reinforced the erroneous objections. His decision explicitly recognised the success and popularity of the new school, but his comments on the impact that the school would have on existing schools demonstrated a reluctance to challenge the position of those schools.

There was, therefore, a case for an appeal against the decision of the schools adjudicator even before the Bill was published. The new, increased range of decisions to be referred to the adjudicator under the Bill makes the case for an appeal process even more compelling.

Sarah Teather (Shadow Secretary of State for Education and Skills, Education & Skills; Brent East, Liberal Democrat)

I shall listen carefully to the Minister’s arguments in response to this Conservative amendment, but we on the Liberal Democrat Benches instinctively see the amendment as attempting to undermine the independence of the schools adjudicator. Our instinct is to oppose it, but we will listen carefully to the Minister and to what the hon. Member for Bognor Regis and Littlehampton says in reply.

Jacqui Smith (Minister of State (Schools and 14-19 Learners), Department for Education and Skills; Redditch, Labour)

As we have heard, the amendment would give schools and the proposers of new schools a right of appeal to the Secretary of State on decisions of the adjudicator. The instincts of the hon. Member for Brent, East are right; it is a slightly surprising amendment, given what I thought was a reasonably recurrent theme of Conservative policy—the need to cut back on the power of Government and the Secretary of State.

The hon. Member for Bognor Regis and Littlehampton wrongly sees the adjudicator as being a creature of government. He disparagingly dismissed those who carry out that important role as being part of what he called an educational establishment that has failed badly—a sweeping deprecation of large numbers of hard-working people who have achieved some considerable improvements over the past eight years.

Nevertheless, I hope to reassure the hon. Gentleman that the eight adjudicators, including Dr. Philip Hunter, the chief adjudicator, all had a wide and diverseexperience of education before being appointed. That is important when making independent decisions about complex educational issues. Three were chief education officers, three were Her Majesty’s inspectors of schools, one was a diocesan director of education and one was a civil servant who now also serves as a parliamentary commissioner. They were appointed for their ability to act impartially, independently and objectively, taking account of the case presented by each party, the evidence presented to support that case and any general guidance issued by the Secretary of State. Adjudicators areindependent of the Secretary of State, and base their decisions on the merits of each case.

As for the merits of the case for the amendment, I am unpersuaded. Although my right hon. Friend the Secretary of State would always take decisions on the merits of the cases that came before her, the possibility has to be considered that not all holders of her office would do so. At one time, many changes to schools came to the Secretary of State for a decision. One reason for stopping that and devolving decision making on school organisation to the local level was to ensure that such decisions were taken without national political intervention.

On balance, we think it right that local decisions should be taken locally whenever possible. That is why, as I suggested after the 1997 election, we introduced the school organisation committee, which we will discuss later, that will represent local stake holders; and we are now introducing a new framework, with the local authority as the commissioner and assurer of education provision.

However, we appreciate that in some circumstances there may be a local clash of interests—a school proposed for closure by the local authority may have different ideas, or a school may wish to expand to offer greater choice to parents. There may be circumstances such as outlined by the hon. Gentleman, notwithstanding the fact that he thought the adjudicator had not made the right decision in those circumstances, where a proposer might make a proposition that the local decision maker turned down.

In such circumstances, we think it right that there should also be an appeal against the decision of the local authority. That is why we have provided the right to appeal to the adjudicator. That right of appeal is the second stage of the process. There will already have been a local determination, with all the consultation and consideration that we have previously discussed in relation to other measures in the Bill. However, there will come a time when appeals must come to an end—a time when enough is enough. An appeal againstthe appeal is, I would argue, unnecessary in such  circumstances. Adjudicators are independent, and their decisions are based on the merits of the case.

In extreme circumstances, as the hon. Gentleman himself pointed out, a judicial review of an adjudicator’s decision is possible. The system is now, but will be even more so under the Bill, made up of an important process of local decision making and accountability alongside an ability to refer disputed decisions to an independent adjudicator. That is an appropriate balance. Having a further right of appeal, particularly one to the Secretary of State and central Government, goes against theprovisions and direction of the Bill and the efficient operation of school organisation at a local level. For those reasons, I oppose the amendment.

Nick Gibb (Shadow Minister (Schools), Education; Bognor Regis & Littlehampton, Conservative)

There is widespread concern outside this place about extra powers being given to the adjudicator, particularly because there is no right to appeal from the adjudicator. Let me pick any page of the Bill: page 115 in schedule 2 contains paragraphs entitled “Duty to refer to adjudicator proposals made by...relevant authority” and “Duty to refer proposals to adjudicator in prescribed cases”. On the next page are paragraphs entitled, “Duty to refer proposals to adjudicator in pursuance of direction by Secretary of State”, “Duty to refer proposals to adjudicator where determination delayed” and “Reference to adjudicator at request of aggrieved person”. I have not even touched on the admissions section of the Bill, in which the adjudicator has a large role.

There should be a right of appeal. That is all that the amendment says, and I am surprised that the Secretary of State cannot bring herself to insert into the Bill, perhaps through a Government amendment, some form of right of appeal from the adjudicator. I very much hope that the Liberals will support us on this, because there might be problems if we do not give this right of appeal—perhaps not in all circumstances, but certainly in some. In light of that, I should like to press the amendment to a Division.