My right hon. Friend's provisional capping principles for all regional and islands councils take into account the overall level of the 1995–96 local government finance settlement; the additional provision which is being made for the police service; and the categories of expenditure which will be disregarded for capping purposes.
Why are the Government cutting their contribution to Lothian's budget and setting the cap only £4 million above the present one, when £9 million is required to cover inflation and an additional £17 million is needed to meet agreed pay awards? Does the Minister realise that many teaching posts in Lothian will have to go at a time when school rolls there are set to increase by 2,500 in August, and when the pupil:teacher ratio is already the highest in Scotland? Why is the Minister sacrificing the children of Lothian to the Government's economic incompetence and to the intended tax breaks of next year?
My right hon. Friend the Secretary of State has made it clear that he accepts that the capping regime for next year is very tight. But it is clearly not unrealistic when one takes into account the level of inflation and for as long as local authorities fund pay increases from efficiency savings—as the rest of the public sector has had to do.
It is wrong to calculate that a specific number of extra teachers will necessarily be required simply because of a rise in pupil rolls. Obviously the impact will vary considerably from school to school. I suggest that local councils thoroughly examine their budgets before they assume that services will have to be cut. Greater efficiency is always possible.
What answer does the Minister have to the Forum on Scottish Education, which warned this week that Scotland's education service is facing its most severe cuts for more than a decade? Yesterday, the Prime Minister advised education authorities to look for efficiencies to fund pay deals. Is the Minister aware that the Rev. John Taylor, chairman of the Forum on Scottish Education, has said that there is no conceivable efficiency that could meet the extra costs and that, therefore, class sizes would increase, support services would diminish and community, outdoor and pre-five education would be cut drastically or even abolished? It is disappointing to hear the Minister regurgitate the Prime Minister's platitudes, dodging and weaving on a major issue. Will he answer parents' worries about their children's education?
I am amazed by the hon. Lady's reluctance to accept that improvements can be made in any form of local government expenditure. The teachers' settlement was negotiated by the Scottish joint negotiating committee, and many district regional authorities took part. I assume that negotiators on the management side took full account of the likely budgetary provision when agreeing the pay deal. It is now up to them to deliver within that pay deal.