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Mr. Nick Hawkins (Blackpool, South): Will the hon. Gentleman give way?

Mr. Blunkett: No, I will not.

This afternoon, we are talking about a challenge to the Secretary of State, in matching the increase in pupil numbers and in matching the need for improvement in investment, books and equipment. The Office of Standards in Education report, published last week, showed that a third of 14-year-olds are not reaching an adequate standard in maths, English and science. More than half the secondary schools in our country do not have sufficient books in the classroom, as the chief inspector succinctly said in only one sentence of a long report.

Mr. Hawkins: Will the hon. Gentleman give way?

Mr. Blunkett: I shall give way one more time.

Mr. Hawkins: Does the hon. Gentleman realise that the fact that so few of our 14-year-olds reach the required educational standard is partly a result of the mad, doctrinaire socialist ideas of comprehensivisation, and the vast waste in Labour-run local education authorities such as Lancashire? That is why schools want to opt out, to ensure that better resources are targeted directly to pupils, not wasted by Labour-run local education authorities.

Mr. Blunkett: The hon. Gentleman shows staggering effrontery. Instead of defending his community's parents against the £24 million cuts that are threatened, he starts abusing and lashing out at everyone around him. What

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sort of a party have Conservative Members degenerated into when, instead of defending their schools and their pupils, they simply seek someone else to get tough on?

What about standards and achievement? What about the £20 million cut that the Government are imposing on education support and training, £9 million of which comes out of the appraisal budget, which has done so much to lift the standard of professional work undertaken by teachers? What about the £13 million cut from the inspectorate budget? What about the removal of £14 million from the crucial reading recovery scheme, which is vital to ensure that primary schoolchildren have a real start in life? We face all those funding cuts before the Government have to find the money to move on nursery education.

Mr. James Clappison (Hertsmere): Will the hon. Gentleman give way?

Mr. Blunkett: No, I will not give way any more. I will continue my speech so that other hon. Members have the chance to speak in the debate.

The Government have illustrated time and again that they believe in rationing excellence and rationing opportunity. That rationing exercise will continue in the way in which funding cuts are implemented and in the way in which they impinge on schools across the country. Excellence for a few and mediocrity for many is not acceptable to Opposition Members.

From Shropshire to Lancashire, from Sheffield to Somerset and from Cornwall to Oxfordshire, people are struggling to defend their services. There are proposals for voluntary income tax contributions and some schools are talking about a three-day week. The last time there was a three-day week was not in the winter of discontent, as was wrongly suggested in the build- up to the previous election, but under the 1973-74 Tory Government when the lights went out and people were told to clean their teeth in the dark. This time perhaps teachers and pupils will be told to work in the dark, to switch off the heating or to bring their own chalk.

The Government's disgraceful amendment has the cheek to congratulate governors and teachers

"for meeting the challenge of education reform".

It is right to give credit to teachers, governors and parents. The spokesman for the Conservative party in Shropshire, speaking at lunchtime today, said that it was an insult to suggest that local authority representatives, members of governing bodies and teachers should take the blame for what was, in his words,

"the responsibility of the Government of the day in terms of funding and support for the service".

We must let our children learn. Our school governors should be concerned about meeting education standards, not struggling with cutting services and undermining their schools. How can children learn if schools are falling into disrepair? Only one fifth of the amount requested for capital investment this year will be granted to schools across the country.

How can the nation face the economic and social challenges of the 21st century with a penny-pinching, underfunding and sanctimonious bunch of ne'er-do-wells running the country? Government Members know all about practising what they preach because so often they preach greed, selfishness and exclusion and then they

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practise it with their families and friends. It is also evident in what goes on in privatised industry and in quangos up and down the country.

Everyone in Britain is worse off under the Tories. Everyone in Britain is expected to pay more for less in Tory Britain. We offer something very different: we offer hope for the future, investment in children's education and optimism about our country's future success. That is why we are giving our backing to parents, governors and teachers in their fight to save their schools in Britain today. 4.13 pm

The Secretary of State for Education (Mrs. Gillian Shephard): I beg to move, To leave out from "House" to the end of the Question and to add instead thereof:

"welcomes the substantial increase in the real level of education spending since 1979; applauds Government policies to raise standards in schools; acknowledges that this year's settlement is necessarily tough but congratulates teachers and governing bodies for meeting the challenge of education reform; and recognises that parents will judge schools above all by the performance of pupils and the quality of teaching and learning.".

I welcome the opportunity to debate these issues. Conservative Members understand that spending by local authorities--which accounts for a quarter of all Government spending--cannot be immune from tough decisions and economic reality. Public borrowing will have to come down if we are to keep a tight rein on inflation and increase prosperity and jobs. It is a tough local government settlement this year. That is my view and I have made it quite clear. The hon. Gentleman has made quite a lot of a leaked letter. I do not intend to comment on it, save to say that it is of a certain age and that the settlement that we finally reached provides for funding for local authority education to rise by 1.1 per cent. That is, of course, on top of a 2.4 per cent. increase for 1994-95.

Mrs. Anne Campbell (Cambridge): Does the Secretary of State agree that the teachers' pay award will be provocatively low, or has she changed her mind since that letter was leaked?

Mrs. Shephard: On the pay award, I shall not anticipate the statement that my right hon. Friend the Prime Minister will make in due course on the reports of the review bodies.

The 1.1 per cent. increase masks a substantial rise in some authorities, reflecting their different needs. For example, in inner London boroughs there have been increases as high as 7.5 per cent., in Trafford there are increases of 4.4 per cent. and in Bury there are increases of 3.3 per cent.

As my right hon. Friend the Secretary of State for the Environment said during the debate on the revenue support grant, there are always questions about methodology. He said that he would look at areas of particular concern when considering with local authorities whether improvements could be made next year.

Mr. Roy Hattersley (Birmingham, Sparkbrook): As the Secretary of State will not anticipate the Prime Minister's statement on the public sector pay award, why

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will she not anticipate in the House of Commons what the Chancellor of the Exchequer anticipated on "The World at One" today?

Mrs. Shephard: I did not have the privilege of hearing my right hon. and learned Friend on "The World at One" today. I rather wish that I had, because there have been a number of conflicting reports as to what he might or might not have said.

The Government share the view that it is a tough settlement, but, of course, it should be set in the context of last year's 2.4 per cent. increase in spending and also the following facts. The hon. Gentleman and his hon. Friends should take account of the fact that spending per pupil has gone up in real terms by almost 50 per cent. since 1979.

Mr. Ronnie Campbell (Blyth Valley): Can the Minister explain to a constituent who wrote to me why £211 less is spent on children in Northumberland than on children in other counties such as Oxfordshire?

Mrs. Shephard: I shall address in general terms the hon. Gentleman's comments as I proceed. The following facts cannot be ignored by the hon. Gentleman, his constituents and everyone else. Since 1979, real spending per pupil has gone up by 50 per cent. Spending on equipment and books has gone up by 55 per cent., on repairs and maintenance by 15 per cent. and on support staff by 135 per cent.

The hon. Member for Brightside mentioned the Ofsted report. It is rather interesting, certainly to Conservative Members, that the Labour party voted against the establishment of Ofsted and, therefore, all means of measuring pupils' achievements, standards and attainment, but they are happy enough to quote from the Ofsted report now.

The hon. Gentleman was quoted last week as saying that the recent HMCI report was

"about as unbiased as you can get",

so what does the chief inspector say about resources?

"In overall terms the provision of resources is satisfactory".

Mr. Dunn: My right hon. Friend will have noticed that the hon. Member for Sheffield, Brightside (Mr. Blunkett) signally failed to answer my question about the need to slim down bureaucracy in the light of more children moving into the grant-maintained sector. That is certainly true of the county of Kent, where spending is out of control. In March last year, the local authority spent £35,000 on a conference at a luxury hotel for head teachers and the only Labour chairman of the Kent county council spent £1,200 of taxpayers' money on takeaway curries from shops in Dartford.

Mrs. Shephard: That would be amusing were it not so shocking. It reminds one of the equally shameful example in Staffordshire where one understands that hard-earned resources have been spent on sending members of a school's staff on relaxing weekends at a health farm.

Ms Joan Walley (Stoke-on-Trent, North): Does not the Secretary of State realise that it is her policies that are causing stress to so many teachers in the classroom? How can she justify so many schools not having sufficient books, the reduction in teacher numbers when schools have already lost so many teachers and the way in which

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school swimming, which is now part of the national curriculum, will not be properly funded as a result of her cuts?

Mrs. Shephard: I have no doubt that people in Staffordshire, parents and governors, will note that the hon. Lady is in favour of jacuzzi education.

The hon. Member for Brightside claims that, as a result of the local government settlement, local education authorities will have to cut their budgets. In fact, under the provisional capping regime, all local authorities will be able to increase their cash spending in order to spend more next year than they are spending this year. What they may not be able to do is to meet all their spending aspirations. Many of the stories circulating about budget cuts are the result of authorities complaining that they will not be able to expand their services in quite the way that they had envisaged.

Mr. Blunkett: If the ability to spend is increased by 1.1 per cent. and the rate of inflation, coupled with the teachers' pay increase, is more than 2.5 per cent., how on earth can there be a capacity to spend more? In real terms everyone can see that they will have to spend less.

Mrs. Shephard: I am glad that the hon. Gentleman asked that question because it coincides exactly with the answer at this point in my speech.

Local education authorities face tough decisions, but they are in the best position to decide their priorities and what they can afford. They can cut their costs because they are still spending millions on running their central bureaucracies and on maintaining surplus places in schools. Last year, the Audit Commission found scope for saving £500 million on the pay bill for local authorities' administrative and clerical staff.

Some authorities are also wasting huge sums on retaining surplus school places. The cost is calculated by the Audit Commission to be at least £250 million a year. I know that it is not always practicable to remove such surplus places--for example, in some rural areas and in areas of population growth--but there is scope to remove some of them, as Warwickshire is trying to demonstrate.

Mr. Keith Mans (Wyre): Does my right hon. Friend agree that it is wrong if, as is the case in Lancashire and other counties, the Government have increased cash resources by 1.4 per cent., for the same counties to cut the delegated budgets to schools by 5.5 per cent? Is not that specifically because they are not making the savings in their overheads at county hall that they should be?

Mrs. Shephard: Lancashire seems to be a good example of that kind of practice. I am amazed that our most recent figures demonstrate that unspent school balances in Lancashire amount to £33 million. Lancashire is an important example of how local authorities can exploit opportunities to have more to spend on teachers in the classroom.

Mr. Mike O'Brien (Warwickshire, North): If the Secretary of State is citing Warwickshire as an authority whose education budget has benefited from the removal of surplus places, she must also explain why the vagaries of the capping limit and the financial settlement have produced a situation in Warwickshire where, despite removing those surplus places, 200 teachers now face the sack and massive cuts will have to be made in the

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education budget. Conservative, Labour and Liberal Democratic councillors have united in condemning that financial settlement.

Mrs. Shephard: I am sure that the hon. Gentleman knows that the detailed plans for reorganisation in Warwickshire are not yet agreed, but it is, of course, worth noting that it has had just above the average increase in its standard spending assessment.

Ms Estelle Morris (Birmingham, Yardley): Will the Secretary of State give way?

Mrs. Shephard: I will give way, but I am conscious of the time and will soon have to make progress with my speech.

Ms Morris: I am grateful to the Secretary of State. She will be aware that many local authorities have seen an increase in class size to cope with the cuts. Her colleague, the Minister of State, has said repeatedly in the House that he sees no connection between an increase in class size and pupil performance. Does she share his view, or does she share the fears of many parents whose children are now in classes of more than 30 or 40?

Mrs. Shephard: I shall repeat the words that are likely to have been uttered by my hon. Friend. No research exists in this country to show that marginal increases in class sizes harm standards. I shall deal now with some of the points made by the hon. Member for Brightside. He has not made it clear how much more he and his party intend to spend on education spending in general, how and from where he might get the money, and which of the Labour party's well-known routes he would follow--whether he would tax, borrow or print money. One thing is for certain--the money will come from the taxpayer, who will pay for Labour's usual mix of inefficiency and ideology, not for better education.

The hon. Gentleman has talked a great deal about the threat to teachers' jobs posed by the settlement. We hear those predictions from Labour Members and from Labour councillors year after year. But the truth is that the number of teachers has remained stable at about 390,000 for the past four years, and teacher vacancies are lower than they have ever been. As pupil numbers increase--as they have done over the past few years--it is possible to tighten some staffing ratios, without threatening standards, as the recent improved exam results show. One must put that teacher staffing ratio in the context of a marked increase in spending on non-teaching staff in schools, thereby releasing teachers for their real work of teaching.

Sir Peter Emery (Honiton): Will my right hon. Friend condemn absolutely the scare story that is being put out by certain Liberal Democrat councils, particularly in Devon, that the Government have cut the grant to local authorities? In fact, in Devon it has gone up by 2.2 per cent? Those councils then go on to say that they are likely to lose 300 teachers. That is putting fear into parents in Devon, which is quite wrong and must be condemned.

Mrs. Shephard: Those are indeed extraordinary assertions from a county which, as my right hon. Friend said, has had twice the average increase; and which, we

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understand, has unspent school balances of more than £10 million, has reserves of £51 million and has increased administrative staff numbers over the past year by 718.

Mr. Harold Elletson (Blackpool, North): Will my right hon. Friend give way?

Mrs. Shephard: I will give way to my hon. Friend, but then I must make progress.

Mr. Elletson: Is my right hon. Friend also aware of the scaremongering of Lancashire county council, which is talking about having to make hundreds of teachers redundant? Will she deal with the point that was made by my hon. Friend the Member for Lancaster (Dame E. Kellett- Bowman), but which was so blithely and arrogantly ignored by the hon. Member for Brightside? Is it not a disgrace that the county council should be threatening to do that at a time when there is a ratio of one bureaucrat in county hall to every 17 teachers? A further point that Lancashire county council refused to take account of is that there are hundreds of surplus places in secondary schools throughout the county.

Mrs. Shephard: My hon. Friend makes a very good point. As I said earlier, a county with unspent school balances of £33 million seems to be making a lot of fuss.

The number of non-manual staff employed by councils increased by 90,000 between 1987 and 1993. The Audit Commission found that less than half that increase resulted from central Government initiatives. So there is room for manouevre--and it is worth reminding ourselves that LEAs have yet to set their own budgets.

Of course, the number of teachers actually employed depends not just on the pay settlement and what LEAs decide, but on how governors deploy the budgets delegated to them. I hope that the hon. Member for Brightside noted carefully what the chief inspector said in his report about the level of balances in schools. He said:

"A quarter of the primary schools inspected carried forward more than 10 per cent. of their budget. Around one-sixth of secondary schools carried forward over £200 per pupil."

He went on to note:

"Such deficiencies underline the need to strengthen financial management . . . Some schools had clear reasons for their surpluses . . . others . . . exhibited undue caution in retaining substantial sums for no considered purpose."

Mr. Blunkett: Will the Secretary of State give way?

Mrs. Shephard: I will, but then I really must move on.

Mr. Blunkett: I shall be brief. Can the Secretary of State confirm that the six schools with the largest balances in Britain are grant- maintained schools with balances of more than £500,000 each?

Mrs. Shephard: What the chief inspector says applies to any school, whether LEA or grant-maintained. It is obvious that schools must manage their resources carefully and to the benefit of their pupils. Our latest estimate is that nationally schools held about £700 million in balances at the end of 1993-94. The clear message of that is that there is scope for substantial efficiency savings. What we have heard today is the usual tired old story. The Opposition's approach is, and always will be, concerned with input rather than output; with money going in, not results coming out; with excuses for

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deficiencies rather than efforts for achievements. Perhaps I should congratulate the hon. Member for Brightside on the service that he has performed this afternoon: he has revealed the truth. Despite the carefully crafted images of the new Labour party, despite the carefully cultivated middle class-friendly, "trust me" approach of the right hon. Member for Sedgefield (Mr. Blair), and despite the phrases so cleverly constructed somewhere in the smartest part of north London, the hon. Member for Brightside has blown the lot. He has confirmed- -as, no doubt, his hon. Friends will do again during the debate--that the Labour party is still the same old Labour party: the party that always costs you more and, as the hon. Gentleman has confirmed this afternoon, the party that intends to go on costing you more, but with no idea of where the money will come from, except that it must come from the taxpayer.

I read with interest what the hon. Gentleman said last week. Here we have the authentic voice: he will have to be reported to high command. He said:

"I believe we must see three key roads to success within the education system: raising standards, increasing achievement and providing opportunities."

Those are, of course, admirable aims. It so happens that they are precisely the education policies of the present Government, pursued in the teeth of objection from the Opposition parties.

Ms Jean Corston (Bristol, East): Will the Secretary of State give way?

Mrs. Shephard: No. I have said that I cannot give way any more, in the interests of those who wish to speak later.

If the hon. Member for Brightside and his party now support the raising of standards, why did they say that tests for children were educationally unsound? How could they vote against testing in the Education Reform Act 1988? If they agree with increasing achievement, why did they say that performance tables were an unacceptable management tool in the assessment of school performance? Why did they vote against the publication of such information in 1980? If the hon. Gentleman and his party now support the provision of opportunity, why, when we introduced grant-maintained schools and city technology colleges, did they say that they would abolish grant- maintained status and force CTCs back under LEA control? Why did they then vote against choice and diversity in education, as provided for in the Education Reform Act? Of course, we cannot be sure about anything that Labour thinks, because some Labour Members have done a U-turn and others have not. The right hon. Member for Sedgefield has reminded us frequently that GM schools are state schools, and that parents have the right to choose schools. Other Opposition Members share his views and demonstrate that by their use of GM schools, but the hon. Member for Brightside opposes GM schools. He said:

"We are against inequity wherever it exists, and that is why we oppose grant-maintained status."--[ Official Report , 21 November 1994; Vol. 250, c. 430.]

In December, he assured his fellow Labour Members that Labour had no intention of continuing GM status, so who speaks for Labour? I accept, of course, that we should be wary of anything that the hon. Gentleman says about new Labour education policies, because the last one that he announced was axed within two hours of him making it by the Labour high command.

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The real issue for quality education is outputs. Our reforms in providing a framework for accountability, and our spending decisions in the past 15 years represent a substantial commitment to raising standards in our schools. The facts speak for themselves. More than 43 per cent. of 15-year-olds achieved five or more GCSEs at grade C or higher in 1994, compared with 33 per cent. in 1989; one in three young people are entering higher education, compared with one in eight in 1979; a record 73 per cent. of 16-year-olds are following full-time education, up from 42 per cent. in 1979-1980.

Mrs. Bridget Prentice (Lewisham, East) rose --

Mrs. Shephard: I am sorry, but I must finish my speech now. Those achievements are a marvellous tribute to our schools, to their teachers and their governing bodies, and to our further and higher education institutions.

If we consider the international picture, we have a record to be proud of. We spend a higher percentage of gross domestic product on public education than Germany or Japan, and we have the highest graduation rate in the European Union. It is on those achievements that schools and colleges will be judged.

The Opposition have a simple policy development system. When the Government announce a new policy, they oppose it. When that policy proves popular, they claim it as their own, and then they promise to double, treble or quadruple the amount that the Government are spending on it. It is quite simple: all one needs is the gall to do it.

Our record speaks for itself. While the Opposition have been dithering, the Government have been doing. While they have been demanding and denigrating, we have been delivering. The threat to education is real. It comes from the Opposition Benches. We shall continue to deliver and to raise standards for all our children.

Mr. Deputy Speaker (Mr. Michael Morris): I remind all hon. Members who hope to take part in the debate that speeches are now restricted to 10 minutes, with the exception of that by the spokesman for the Liberal Democrat party.

4.36 pm

Mr. Roy Hattersley (Birmingham, Sparkbrook): I propose to deal exclusively with the small part of the speech of the Secretary of State for Education which dealt with the question under debate: this year's payment round to local authorities and, specifically, its effect on education.

The Secretary of State said loftily that she did not propose to deal with the subject of the letter that she sent to the Chancellor of the Duchy of Lancaster. I understand why that is, but some of us do not feel the same restraint as it does not put us in the position in which it puts the Secretary of State. That leaked letter leaves her with two alternatives: to explain why she has undergone such a massive conversion in the past six weeks, or to admit that she intends to administer a policy that six weeks ago she said would be disastrous for the education service. Perhaps the Minister replying to the debate will tell us which of those alternatives the Government intend to choose.

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The memorandum said that the proposal by the Chancellor of the Duchy of Lancaster to increase the standard spending assessment by 0.3 per cent. at a time when school rolls were increasing by 1.5 per cent. would produce a real reduction in expenditure of 1.2 per cent. per pupil. Let us operate exactly the same methodology and statistical technique with the present figures. They show that, when school rolls are increasing by 1.5 per cent., a 1.1 per cent. increase in the SSA produces a real reduction in expenditure per pupil of somewhere between 0.3 and 0.4 per cent.--a view confirmed by the Secretary of State's statisticians this morning. That is the basic figure of the present equation as demonstrated by her memorandum. That is also before we take into account the increase that schools are bound to face because of the increase in teachers' pay.

Let me tell the Secretary of State what the Chancellor of the Exchequer said at about 1 pm today. Incidentally, the Government would work a great deal more effectively if members of the Cabinet talked to each other from time to time. At 1.10 pm today, the Chancellor said that there would not be another penny to help pay for teachers' salaries. I will now remind the Secretary of State what she said to the Chancellor of the Duchy of Lancaster about that situation six weeks ago. She said that the cost of the teachers' pay settlement, assuming that it was something like 2.7 per cent. or 2.9 per cent., would be £90 million.

The Secretary of State asked my hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett) where the money was to come from, but she might tell us where the £90 million that she demanded six weeks ago was to come from. She said that if the £90 million was not available, the equivalent of 70,000 or 100,000 teachers would have to be sacrificed. The money is not forthcoming, and the only possible alternative for local education authorities and individual governors is to do what the Secretary of State warned the Chancellor of the Duchy would have to be done and reduce the number of teachers in our schools. We do not have to argue about that because that was the Secretary of State's opinion six weeks ago. I want her or her junior Minister to get up and tell us whether she still believes that that will be the disaster set out in her memorandum, or whether there has been an extraordinary change of heart.

I would describe the Secretary of State as the convert of the year, had not the hon. Member for Rugby and Kenilworth (Mr. Pawsey) appeared on television yesterday evening with a great revelation that he wanted to make to the world--that local democracy meant that local authorities ought to be able to raise local taxes according to the demands of their constituents. I welcome his conversion to the policy that the Labour party has advocated for the past 15 years.

Mr. Jacques Arnold: Will the right hon. Gentleman give way?

Mr. Hattersley: No, certainly not when I have only 10 minutes. I welcome the conversion of the hon. Member for Rugby and Kenilworth, but he is not so significant a figure as the Secretary of State--to whom I would, of course, give way immediately even though I have only 10 minutes. Does she stand by what she said in her

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