My Lords, I too welcome the opportunity to participate in this somewhat strange debate where the subject matter oscillates between transport, energy, agriculture and education. I join others in congratulating the noble Baroness, Lady Ashton of Upholland, on her promotion to the ministerial Benches. I look forward a great deal to working with her and perhaps also sparring with her over the coming months.
From these Benches we welcome very much the main themes that have dominated the gracious Speech--the securing of improvements in the delivery and quality of public services in this country. From the Liberal Democrat point of view it is an issue that we have been stressing for at least two elections. We suspect that the Government may not find it so easy to achieve increases in the quality of services without also increasing public expenditure fairly substantially and perhaps also taxation.
When the noble Baroness, Lady Thatcher, was Prime Minister she emphasised very much the maxim "You can't get something for nothing". I believe that the great danger with emphasising private provision alongside public provision is that there is sometimes the belief that by providing finance privately one does not have to incur public expenditure as the other side of the equation and it kids the general public into thinking that one can actually get something for nothing.
One looks, for example, at the funding of the Norfolk and Norwich Hospital and the public finance initiative at a cost of £300 million straight but £900 million when funded through the private finance initiative over 30 years. In the long run such an initiative may well cost a great deal more. In the short run there is a gain because it is not part of the public sector borrowing requirement, but in the long run we may well pay more in terms of taxes, interest and profit margins.
I believe that concentration on the public sector borrowing requirement is a shibboleth and has led to failure over a long period of time to make a distinction in the public sector accounts between current and capital expenditure. That in itself has led to a disastrous rundown and neglect of our public sector infrastructure, not only of schools and hospitals but of the transport service and general public utilities. Our Victorian forebears knew that investment was worth while, that it lasted a long time and was worth making.
We now have to make good that lack of investment. I believe that the public sector has to take its share in making good that lack of investment. We should not kid ourselves that by bringing in the private sector as partners we can get something for nothing. We cannot. We shall either have to pay for it in terms of higher taxation now or in the future.
I wish to devote most of my speech to education. Here the emphasis of the gracious Speech was on secondary education and extending its diversity in order to improve its standards; to extend the range of city academies and specialist schools; to allow for more faith-based schools and more fixed-term contracting out of educational services to the private sector.
The challenges to education in this country are considerable. The noble Lord, Lord Dearing, stressed the high illiteracy figures that we face. One-fifth, which is 20 per cent of the population in this country, cannot, he said, read well enough to be able to look up plumbers in the Yellow Pages. As Estelle Morris, the new Secretary of State for Education, said last week, it is a frightening statistic. The OECD figures which were published only a short time ago exposed the United Kingdom as being near the bottom of the literacy league. However, it also showed that Britain was near the bottom of the spending league. It may be that the two are tied together.
The Government announced considerable increases in spending on education in their two spending reviews. Nevertheless, I believe that it is an indictment of their first term that, taking the four years as a whole, spending on education as a proportion of GDP at 4.6 per cent is lower than spending on education as a proportion of GDP during the five years of the Major administration between 1992 and 1997, when it was 5 per cent. It is a great indictment that a Government should come to the country in 1997 preaching "education, education, education" and putting it at the top of their prorities list only to end up during their first term spending on it a lower proportion of GDP. I am delighted that at long last some of that money is coming through and we are seeing it in some of our schools. But it has been far too slow. It has led to a serious crisis in recruitment. All the targets set by the Government for achievement both in primary and secondary education depend on there being teachers to meet those targets. If we cannot find them we shall not be able to meet those targets.
As regards secondary education, the main emphasis is on specialisation. As my noble friend Lord Dahrendorf indicated, as Liberal Democrats, by and large, the concept of diversity is one which we enjoy and endorse. However, we are somewhat weary of the concept of specialisation. A specialist school brings with it £500,000 in terms of extra funding over the first four years of specialist status. Only 46 per cent of schools are to enjoy that status. What about the other 54 per cent? What happens to them? Will they not enjoy specialist status? Liberal Democrats believe in diversity and pursuing specialisms in many senses, but at the same time every school, not just some, should be special.
Much has been made of the turn-round of a school in Guildford which I know fairly well. That school was called King's Manor but is now known as King's College. What happened there illustrates that resources and being made to feel special count for a great deal. It is too early to say how successful has been the experiment; the school opened in its new guise only last September and still has only 450 pupils, whereas its maximum will be about 900. The school benefited last year from county council and the Government combined spending well over £3 million and the fact that at the moment pupil/teacher ratios are extremely low and staffing is generous. It is clear, however, that the pupils of that school have benefited from the extra resources lavished upon them. They feel special, have responded to it and are far better motivated than before.
The right reverend Prelate the Bishop of Blackburn in his excellent speech said that Church schools provided a clear and coherent value system. That has been developed as a result of the change from King's Manor to King's College. The new owners have given a clear and coherent value system to that school and the children feel special and have had much in the way of resources lavished upon them. Their expectations and those of their parents, which are so important, have been raised. Expectations are high but the pupils have begun to achieve them, which is extremely encouraging. The motivation is there and aspirations are rising, but that situation results from resources and leadership. One wants those two important qualities, which do not necessarily require privatisation--both can come through the public sector--to turn round the school.
Our other reservation about specialisation is that it comes much too early. The danger of specialising at 11 is that one must select at that age. I do not believe that at the age of 11 children know what they want to do. The week before last I benefited from a brief visit to Holland to look at secondary education in that country. The Dutch also have a great diversity of secondary schools. It was interesting to hear about that diversity and visit two of the schools. What came across to me was that for a long time Holland had had a clear and coherent stream of vocational education alongside academic education. That is something which many of the northern European countries--Germany and Scandinavia--have. Selection is not made at 11 but effectively at 14, when I believe a child knows its own capacities much better than at 11. At 14 a child with its parents and teachers selects the stream that it wants to go into, whether it be a high academic or higher or lower technical stream. I believe that if we are to select, it is far better to do it at 14 rather than 11. I am very wary of returning to something that is akin to the 11-plus.
I conclude by making one or two points about what I believe was omitted from the education agenda in the gracious Speech. I was extremely surprised that there was no mention in the gracious Speech of the teacher crisis, but my noble friend Lady Walmsley will, I believe, talk about that later. Above all, there was, surprisingly, no mention of either further or higher education. I believe that it is those sectors which present us with some of our trickiest problems today. The biggest problem is undoubtedly funding. The noble Baroness, Lady Blatch, referred to the failure to fund the Bett report and the problem of academic salaries. We currently face a major crisis in recruitment and retention among teachers in secondary schools, but unless something is done about academic salaries very quickly there will be an even bigger crisis in recruitment and retention in the universities. I hope that the Government have some plans to meet the funding requirements in this sector.
It is also somewhat perplexing that at a time when they aim to expand the numbers from the lower social classes entering higher education, the Government simultaneously pursue a policy which my honourable friend in another place, Mr Phil Willis, described as an abomination. I refer to students' tuition fees, the abolition of the maintenance grant system and the introduction of student loans. This system puts off precisely those students whom one tries to entice into the higher education system. I know that they do not have to pay fees and that some limited grants are available. Nevertheless, the perception of what they have to face puts off precisely those students. We on these Benches do not understand why the Government persist in pursuing that policy at the present time and advocate the adoption of the Cubie solution in Scotland.
Another problem that the Government must confront is the increasing blurring of the boundaries between further, higher and Internet education. At a time when one can undertake university courses via the Internet one must rapidly think how to merge or mix and match courses between the different sectors. I do not believe that the Government have faced up to that at all. Learn Direct is doing some valuable work, but we are far from having an accredited unit system which covers the whole of the higher and further education sector. We need to look at that and think about it.
The issues on which I have spoken--specialisation and what it means and the need for every school to be special, to develop a clear and coherent stream of vocational education and training, properly to fund our further and higher education sectors and to face up to the merging of those sectors--create many new challenges for the Government. The gracious Speech touches on only a very small part of that agenda, but I hope that during this Parliament the Government will face up to those challenges.