Orders of the Day — EDUCATION BILL [Money]

– in the House of Commons at 9:40 pm on 10th November 1992.

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Queen's Recommendation having been signified—

Motion made, and Question proposedThat, for the purposes of any Act resulting from the Education Bill, it is expedient to authorise—

  1. (1) the payment out of money provided by Parliament of any sums required by the Secretary of State—
    1. (a) for making grants to the following bodies established under the Act, that is, the Funding Agency for Schools, the Schools Funding Council for Wales and the School Curriculum and Assessment Authority,
    2. (b) for paying remuneration, allowances and other expenses in respect of the Special Educational Needs Tribunal, or any education association, established under the Act,
    3. (c) for making payments in respect of expenses incurred in connection with the acquisition by any school of grant-maintained status,
    4. (d) for making grants to the governing body of any grant-maintained school, including a governing body in liquidation, and
    5. (e) in respect of any administrative expenses incurred by the Secretary of State under the Act;
  2. (2) any increase attributable to the Act in the sums payable under any other Act out of money so provided; and
  3. (3) the payment of sums into the Consolidated Fund. —[Mr. MacKay.]

Photo of Mr Bob Cryer Mr Bob Cryer , Bradford South 10:15 pm, 10th November 1992

I feel it necessary to raise a few matters relating to the money resolution because, by its tone and content, it is a propaganda section of the Bill. The explanatory and financial memorandum contains a section claiming to give the financial effects of the Bill, paragraph 2 of which, under the heading, "Financial effects of the Bill," states: The proposed new funding authorities for schools will take over from the Department for Education and the Welsh Office responsibility for the calculation and payment of recurrent and capital grant to grant-maintained schools under regulations and guidelines made by the Secretary of State. It goes on to say later: It is expected that the costs of the funding authorities will be offset over time by savings in the running costs of the Department for Education and the Welsh Office". What is the time scale? When the transfer of funding takes place, there will be a gap between the new funding authorities—[Interruption.]

Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons

Order. It would be appreciated if hon. Members having meetings would continue them outside the Chamber.

Photo of Mr Bob Cryer Mr Bob Cryer , Bradford South

The money resolution provides for any sums of money required by the Secretary of State. In other words, when the House has passed the resolution, it will not have given authority for money to be spent through the new funding authorities, that money being offset by money that was spent by previous authorities. It will have given authority to the Department to provide for any sums of money that the Secretary of State may require.

Paragraph 3 states: Local education authorities are currently paying for the upkeep of up to 1·5 million more school places than are required … Clause 14 places a duty on local education authorities and funding authorities to provide the Secretary of State with information". Clause 14 places a number of not qualified but absolute duties on local authorities. Those duties will cost money. As the House knows, LEAs, and local authorities in general, are extremely short of money. Will the money being authorised be made available to LEAs to cover the duties that clause 14 places on them?

It is interesting to note that the money resolution provides for any increase attibutable to the Act in the sums payable under any other Act". If the Minister does not intend to pay money directly to the Department, what will happen if local authorities can show that the total expenditure that they are undertaking by virtue of the additional duties will result in a reduction in some other area of local authority expenditure? Does the money resolution require the Department to provide an increase in the amount to be paid? That places yet another obligation on the backs of local authorities without, so far, clear provision having been made by central Government to employ people to do the work in providing information about the alleged 1·5 million places that are needed.

By the way, the money resolution is couched in general terms, as are the "Financial effects of the Bill". I hope that the Minister is aware that local authorities such as Bradford, part of which I represent, do not have an excessive number of school places. Bradford has a shortage of school places because it has an expanding roll of pupils. More money is needed, not for the administrative requirements with which the Bill is riddled but for new schools and extensions to existing schools.

The Minister is probably aware that some 600 temporary classrooms are in use in Bradford to sustain the education system. I hope that he will bear it in mind that the powers contained under "Financial effects of the Bill" and the authority that he will gain from the money resolution cannot be used only for the grant-dispersing bodies—funding authorities—referred to in the Bill. As the money resolution provides for any sums required by the Secretary of State", he could conceivably use the authority in the Bill and the resolution to provide additional educational facilities for local authorities like Bradford, which are very short of money and urgently need extra money for proper educational purposes, such as more classrooms and permanent school extensions.

I draw the Minister's attention to the provision for payment of local public inquiries when schools are to be closed. What calculation has been made for the cost of those local inquiries? The money resolution provides for the Secretary of State to pay for them. The Government have a lot of experience in financing local public inquiries, particularly in controversial areas such as changing existing roads and introducing new roads. As it happens, the closure of schools is highly controversial and emotive, and local public inquiries could be heated, lengthy, and costly. Based on the Department for Education's experience in undertaking school closures, has the Minister made a rough calculation of how much will be allocated to financing local inquiries?

Paragraph 5 of the "Financial effects of the Bill" covers the balloting of parents and makes it clear that, under clause 28, the Secretary of State is given a new power to pay grant to local education authority maintained schools in support of the costs associated with their ballots of parents". What powers does the Secretary of State have in mind to pay those sums of money? The payment terms are determined by the Secretary of State but nothing is laid down in the Bill. The House is authorising the Secretary of State to spend money, having been given no idea of the extent of that expenditure. For example, it is one thing to provide postage for a single document explaining the parents' case, but it is another thing if the Secretary of State has in mind money to finance a propaganda campaign to support the move towards grant-maintained status. That would be entirely different and a great deal more expensive.

Before we give authority to the Secretary of State to spend money on terms determined entirely by himself, the House should know something about the sums that the Secretary of State has in mind to spend. It would be very unfair if he intended to hand out to parents who want to undertake balloting large sums of cash, simply on a propaganda exercise, without both sides of the argument being presented to those who wish to vote. It seems fair and reasonable to ask the Secretary of State what is to be provided. [Interruption.]

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

Order. I am sorry to interrupt the hon. Gentleman, but there is far too much noise in the House. I understand that Madam Speaker has made that point once already.

Photo of Mr Bob Cryer Mr Bob Cryer , Bradford South

I am grateful to you, Madam Deputy Speaker. My hon. Friends on the Bench beside me have been making that very point. It is disturbing, particularly when hon. Members are making serious points about money. The House lets money resolutions go through far too easily.

I have yet to hear the Minister's reply. It may be that some hon. Members who are beyond the Bar of the House are getting near the door so that they can go home. The more noise that emanates from that area, the more I shall feel bound to call a Division if the Minister's reply is less than satisfactory. On the other hand, if there is rapt, silent attention to my remarks in recognition of the seriousness of the occasion, the Minister may take more time to explain the position and I may be satisfied and may not have to call a Division. I do not want to cause disruption needlessly. As the House knows, that is not my style all the time.

I am seeking information because we are very concerned. My hon. Friends have been discussing seriously with me the aims of the Secretary of State Truth to tell, the section on the financial effects of the Bill is very bland. We are told that, when expenditure is moved from one area to another, one will offset the other and there will be no cost. That is not good enough.

The Department should have made guesstimates at the very worst and informed calculations at best. Those should have been placed before the House. We are not asking the Department for information on sums of money by which they will be bound but, as the money resolution is couched in extensive terms, it gives the Secretary of State virtual carte blanche to spend what he likes. That is not good enough. People would not accept that the Government should use taxpayers' money under the balloting provisions for Tory propaganda in support of the Government's cause. That is what it seems like to me. I hope that the Minister will prove me wrong.

Another point causes me extraordinary concern. On the Tory Benches. we have a collection of merchant bankers, Lloyd's members, estate agents and all the rest [HON. MEMBERS: "No."] Some of them may not like to be associated with Lloyd's now, but they did at one time. They are always concerned about public expenditure and say that it should be cut. Yet when it comes to this, they want carte blanche in the amount that they can spend. Given their attitude towards public expenditure, I should have thought that they would not want a general power under the money resolution but would want detailed calculations from the Department. The figures could have been brought before the Minister, who could then have presented them, in general terms, to the House, to show what good housekeepers the Government really are—to show that they are not prepared to hand out taxpayers' money for secret propaganda.

Some of these Tory Members voted last Wednesday because they were worried about the shift of sovereignty from this House to the Common Market. Twenty-six of them went into the Lobbies with us. They should not be prepared to ignore a bland money resolution of this nature, which gives widespread powers to Ministers. It is inconsistent of them to worry about the sovereignty of the House but not to worry about handing over unqualified, unquantified powers to the Secretary of State, to spend as he likes.

That is why I have raised these issues, against a background of noise emanating from indifferent Conservative Members standing beyond the Bar of the House. [HON. MEMBERS: "Where are your hon. Friends?"] I do not need large numbers of Labour Members behind me. They know that I am capable of raising all these issues on my own, with the support of those of my hon. Friends who are sitting beside me.

I hope that some of the Conservatives here tonight are not here only because they have been told to stay by the Whips in case there is a Division. I hope that they are interested in this subject and that they have not been bribed, arm-twisted or intimidated, as they were last week to give the Government a majority of three. The subject merits attention in its own right.

Photo of Mr Nigel Forman Mr Nigel Forman , Carshalton and Wallington 10:31 pm, 10th November 1992

As one who has been in the House for quite a long time—perhaps not as long as the hon. Gentleman, or perhaps even longer—I can tell my younger colleagues that we have just heard a characteristic speech by the hon. Member for Keighley.

Hon. Members:

He lost it.

Photo of Mr Nigel Forman Mr Nigel Forman , Carshalton and Wallington

Perhaps there is some connection there In any event, these are the sorts of speeches that the hon. Gentleman is used to making, almost in his sleep. Indeed, some of us remember finding opportunities to sleep when he was making them. Nevertheless, I have taken his remarks seriously, and I shall try to answer some of his questions.

The hon. Gentleman began by referring to the cost implications of the proposed funding agency for schools. The Government intend it to be a very lean and light-touch body, with minimal costs involved. The precise costs will depend on a number of factors—most importantly, the growth in and the number of grant-maintained schools. The body's main functions will relate to the payments of grant to those schools, and the running costs will be offset by savings in the LEAs' and the Department's administrative budgets.

In the last year for which figures are available, local education authorities' administrative costs totalled about £900 million. The costs associated with the assumption by the funding agency of planning responsibilities will be minimal, as will any start-up costs. The FAS will be, as I say, a light-touch body, not a bloated bureaucracy. It will attract people from commerce and industry, who will bring to its management financial skills that will ensure that it operates cost-effectively.

The costs incurred under clause 14 should be equally modest, if not minimal. The various statements of information required are an extension of the general requirements on LEAs to provide information to the Secretary of State under the 1944 Act. There is nothing new or dramatic about that. The costs should be more than offset by the savings resulting from the removal of surplus places, thanks, inter alia, to the provision of that information.

Photo of Mr Bob Cryer Mr Bob Cryer , Bradford South

What about a local authority such as Bradford which does not have surplus places? If it can justify extra costs incurred as a result of the new obligations in the legislation, will it receive grant aid to meet those costs?

Photo of Mr Nigel Forman Mr Nigel Forman , Carshalton and Wallington

I should have thought that such a local authority might well be interested in new school buildings as well. However, I should prefer to give the hon. Gentleman a considered answer to his precise point by writing to him later.

The hon. Gentleman also asked about the administrative expenses of the public inquiries foreshadowed in the Bill. The main additional administrative expense will be cost of the inquiries. The public inquiry procedure is a last resort. The Secretary of State's new powers should concentrate LEA and funding agency minds to bring forward sensible proposals and only when they do not will the Secretary of State need to bring forward his own proposals.

Therefore, public inquiries will be cost-effective. The end product should be a sensible scheme for the removal of surplus places where the LEA or the funding agency has not offered one. Where major reorganisations are concerned, that can result in significant capital and revenue savings over a number of years. The hon. Gentleman should be assured that any additional tasks flowing from the operation of the public inquiry system can be absorbed within the Department for Education manpower planned provision.

The hon. Gentleman asked about the role of ballots and their possible cost. Let me try to reassure him. He follows these matters closely and he will know that hostile local education authorities have sought to exploit the substantial resources at their disposal almost to intimidate governing bodies which may be considering grant-maintained status and to undermine their attempts to inform parents properly.

In contrast, governing bodies have only limited funds at their disposal to present their views about what is best for the future of the school. Therefore, by limiting local authority expenditure and putting modest sums at the disposal of governing bodies for the promotion of grant-maintained status, we intend to redress the balance in order to ensure that there is a balanced debate on the issues. In that way, parents will be given every opportunity to make informed decisions about what is best for the future of their school.

The grant to the governing body will be sufficient to pay for the cost of producing one leaflet about grant-maintained status. It is as modest as that. When the House considers that individual schools are as David to Goliath when faced with large local education authorities determined to argue the case against, it will see that that is only redressing the balance in a fair and reasonable way.

The Bill will help us to get better value from our substantial investment in education. It will do that, first, by providing a framework for the expansion of grant-maintained schools. The independent status of grant-maintained schools and the sense of ownership that they enjoy have significantly enhanced their work. Experience has shown that grant-maintained schools can use to very good effect their share of their former LEA's central costs, which is exactly what is passed over to them.

The Bill will secure better value for money by tackling the scandal of surplus school places. In too many cases, LEAs have failed woefully to take the resolute action required. In consequence, there are now up to 1·5 million surplus school places, the sheer maintenance of which pre-empts an estimated £300 million a year. We need to release as much of that as possible to spend on children's education. Allied to that is the problem of uneconomically small schools which must also be addressed.

The Bill will tackle the problem of surplus places by giving the Secretary of State the powers to direct local education authorities, and the funding authorities if necessary, to bring foward proposals to remove surplus places. The Bill also gives the Secretary of State powers to bring forward his own proposals for schools reorganisation where he is not satisfied that the LEA's proposals adequately address the problem.

In all those ways, and as the White Paper explains, our proposals provide a framework for the efficient and effective development of policies that the Government have pursued since 1979. We believe that they will lead to significant increases in value for money and improvements in quality over the years ahead.

Question put and agreed to.