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On 6 January, the chief education officer of Lancashire county council, Andrew Collier, sent me a letter saying:

"We have received the Annual Capital Guideline for 1995/96 and the picture is indeed grim, as you say in your letter."

That is the letter that I sent to him.

"The ACG notified is £8.105 million. We understand that against a bid well in excess of £20 million for improvement replacement work, we have been allocated £384,000 for all improvement replacement work in Lancashire."

Therefore, about 20 per cent. of Lancashire's bid for capital has been allocated by the Department.

I am not saying that the Government have treated Lancashire any differently from any other education authority. I accept that Lancashire has received the average figure for education authorities throughout the country. However, I do say to the Minister that if it is insufficient in Lancashire, it is insufficient in every other education authority in the country and the Government must consider it.

I want to refer to the replacement and repair work needed in two primary schools. I shall quote first from the Burnley Express and News of 31 January 1995. It refers to Rosehill County junior school, a school which I have visited twice in the past couple of months. It says of the toilets in that school:

"Children are currently faced with pitch-black darkness and cold when they go to the toilet, as well as nasty smells from open drains and leaking roofs . . . Mr. Pilborough"--

who is the head--

"condemned them earlier this month during a visit to the school by chairman of governors Mr. Walter Cook"

and myself.


that was the day before the newspaper article--

"he said: `funding these days is effectively from Central Government. You cannot blame Lancashire County Council because there's not enough money' . . . Mr. Pilborough described the toilets as `disgusting' and `unhygienic'."

Before I was a Member of Parliament, I was a shop steward in a factory, and if those toilets had been in that factory the people would have refused to work. That standard of toilets is unacceptable for 1995

At the weekend, I received a letter from the Rev. Christopher Cheeseman, the chairman of governors of Lowerhouse junior school. He sent me a report that was published by the inspector on 30 January 1995. In the covering letter, he says:

"At present we have raining in two classrooms and many other roof leaks. The importance is being stressed by the Secretary of State of teaching standards, but no concern seems to be given to make sure authorities have the money for major structural repairs". I shall quote a couple of paragraphs from the report by registered inspector Mr. P.D. Edwards, whose inspection took place on 5 to 9 December 1994, because that is a scheme that the Government have set up to inspect schools and consider all aspects of schools. The inspector says in the section referring to accommodation:

"The building is in an unsatisfactory state. Parts of it are damp, apparently due to a leaking roof and other structural defects. Every classroom has flaking plaster and peeling paint, and in many places the ceiling panels are warped and stained. The corridors are draughty and ill lit and, overall it is a depressing atmosphere in which to work . . . Two of the worst lavatories have recently been refurbished and these are pleasant. However, some others are malodorous despite regular cleaning, presumably because the surfaces have become porous."

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The final part of that section, referring to pupils' welfare and guidance, said:

"Some parts of the school are unacceptably cold. Temperatures below 60 degrees Fahrenheit, and as low as 52 degrees Fahrenheit, were measured in a number of classrooms during the week of inspection, when the weather was not exceptionally inclement."

What an appalling position to be in.

Mr. Gordon Prentice (Pendle): My hon. Friend knows that the horrors that he has described in his constituency are commonplace in Pendle. I have the example of the Laneshaw Bridge primary school, and Eleanor Bleasdale, the headmistress, who has been in touch with me about the toilet block there. There is no way that the county council can afford to recondition that toilet block unless and until it is certified as a hazard to health. That is an appalling state of affairs, which is characteristic of schools throughout the north-west and in Lancashire.

Mr. Pike: I thank my hon. Friend. I fully accept, and he will appreciate, that I could not possibly read the list of all the schools where major or minor works are needed in Lancashire, because we would have needed a three-hour debate simply to discuss the problems of capital deficiencies for schools in Lancashire. However, I underline those problems.

I shall now deal with the question of standard spending assessments and revenue funding. I have received a letter from Lea county primary school, Preston. I want to refer to a number of letters which I have received from outside my constituency to show that I am not just arguing the case for Burnley. The letter, which is dated 7 February and is signed by the chair of governors, was faxed to me this morning. It says:

"Specifically, we are incensed that the government will not meet the full costs of the teachers' pay award. It is intolerable that whilst some teachers may receive a pay rise another may well be made redundant".

The Minister must respond to that point. I have also received a letter from All Saints Church of England school at

Clayton-le-Moors--again, it is not in my constituency--which is signed by the Rev. Philip Dearden, who says:

"On behalf of the Governors at All Saints Church of England Primary School I wish to express our alarm at the savage cuts in funding for Education in the year ahead. In a typical One Form Entry Primary School of 240 children like ours this will mean a budget cut of approximately £15,000".

I have also received a letter dated 1 February from the Methodist church in the north Lancashire district. It says:

"In spite of the threatened cuts Lancashire County Council is anticipating spending 108 per cent. of the standard spending assessment".

I emphasise that point. It means that the council will spend more on a particular service than is required under the SSA. It intends to spend 108 per cent., yet Conservative Members have attacked the council for the way in which it has reduced the local management of schools budget. If Lancashire were not prepared to spend more than the SSA, it would have to cut funding even more in order to conform to the Government guideline. The letter continues:

"In addition we cannot accept that, because of the area cost adjustment, the children in Lancashire are worth less (£105 per primary and £145 per secondary child) than children in Hampshire, Essex and Kent".

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I shall return to that important point later. The five main teaching unions in Lancashire are reported in the Burnley Express of 31 January as saying:

"the Government's funding policies for education will badly hit the quality of lessons".

That is of great concern to me and to Labour Members of Parliament who represent Lancashire.

I wish to correct some of the mistaken impressions created by Conservative Members in education debates. It has been claimed that Lancashire has one administrator for every 17 teachers. That allegation is absolute nonsense. The figure includes people dealing with university awards, the youth service, adult education and every other group within the education department. It has nothing to do with schools. The ratio of staff who provide direct services for schools to teachers is 1:74.7, and even if we include the administrations category the ratio is only 1:33.5. It is important that people quote the facts in the future.

Compared with total spending on education, education costs in Lancashire are among the lowest in the country. That is an important point to remember, and people should get their facts straight if they intend to attack Lancashire council's activities.

Great play has been made of the fact that Lancashire proposes to cut 5.5 per cent. from the school delegated budget. That will affect school expenditure on equipment and staffing. It will mean larger class sizes and the loss of teaching posts--perhaps as many as 600. The youth service, adult education and discretionary awards will be hit. Lancashire county council does not want to do that, but the responsibility for those cuts lies with the Minister and with the Government.

Some accusations have been made. The Department talks about surplus places, but it never talks about schools which have an excess of pupils. A number of schools in Lancashire have more pupils than they should. The Government should look at the net figures. We also need to consider the growing population and the increasing number of children. Surplus places now may not be so in a year's time and almost certainly will not be surplus in five years' time. The Minister must recognise that, for parental choice to work, there have to be surplus places. Without them, it is impossible. The Minister must also recognise that Lancashire has met all previous Department of Education targets in cutting places.

Another wrongful claim is that balances held by schools under the local management of schools total £33 million. The figure was £33 million at the end of 1993-94; it is certainly not that now and nobody knows what it will be at the end of the financial year. The biggest problem in Lancashire is caused by the area cost adjustment. Using all the other factors in the SSA, the figure for Essex is £2,540.42. The figure for Lancashire is £2,610.92. When the area cost adjustment for Essex of £215.43 is added on, the figure for Essex becomes £2,755.85. But for the area cost adjustment, Lancashire would have a SSA per secondary school £70 per pupil higher than Essex, but because of the area cost adjustment, the figure is actually £145 less.

We do not believe that the area cost adjustment has been correctly accounted and adjusted for education in Lancashire. We believe that the figure is wrong and is one of the crucial factors affecting the education in Lancashire.

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The position is grim--the grimmest since 1983 when I became Member of Parliament for Burnley--for both capital and revenue. I hope that the Minister will think again and in his response to tonight's short debate give us some good news. However, although I have known him for many years and have a high regard for him, I think that he will disappoint us by adhering to the Tory right-wing Government who put cuts and financial constraints before everything else.

10.46 pm

The Parliamentary Under-Secretary of State for Schools (Mr. Robin Squire): Perhaps I can begin by congratulating the hon. Member for Burnley (Mr. Pike) on securing the debate and on being flanked on either side by the hon. Members for Pendle (Mr. Prentice) and for Lancashire, West (Mr. Pickthall) who, with the exception of one intervention, remained in noble but silent support of his speech. As the hon. Gentleman said, the House discussed earlier today a number of the issues that he has quite properly raised. Due to both the absence of fury from the Opposition during that debate--indeed, the absence of Opposition Members for most of the debate--and the substance of the case put, it was not the best of days for an Opposition seeking to show that in some way the Government had behaved outrageously, but I shall return to that later.

I welcome the opportunity provided by tonight's short debate to examine one authority in detail. It is useful because Lancashire is a excellent example of an authority where the cry of cuts is largely artificial.

Lancashire has done slightly better than the national average with an increase in its education standard spending assessment of 1.4 per cent. and, despite the complaint that the Government are forcing the authority to cut budgets, its capping limit allows Lancashire to increase its overall spending next year. The hon. Gentlemen's constituents might reasonably ask why, with a rising education SSA and a rising budget limit, Lancashire county council claims that it is forced to slash £25 million from its schools budget. The answer, simply put in an admittedly complex area, is that the cuts are essentially fictitious.

Let me stress that the local education authority is not cutting what it is actually spending, but what it would ideally have liked to spend. It has taken its education budget for 1994-95 and inflated it by something like 5 per cent. The council proposes to cut that artificial budget, but when schools are told that they face budget reductions, they are given the impression that they will lose a slice of their existing income. Most of those cuts are an illusion. It is all done by mirrors, as someone once said. But, in fairness, it is an illusion that misleads and can alarm thousands of parents and pupils.

I have no doubt that when the hon. Gentleman spoke about the correspondence that he had received he was being truthful, but I am suggesting to him tonight that part of that, for reasons to which I have already alluded, is based on a false premise.

I should also say that Lancashire is not alone in creating that misunderstanding. Several other authorities have created publicity that is far more misleading than that

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created by Lancashire. To its credit, Lancashire has written to its schools explaining its calculations. But for all that, in Lancashire as elsewhere the cuts are not as they are being presented. The hon. Gentleman next referred to capital issues. I say to him and to the hon. Member for Pendle that, perhaps unsurprisingly, I do not have with me today the detail on the schools to which both referred, but I undertake to write separately to them with a detailed comment on both the schools that they mentioned. I hope that they will take that in good faith, as it is meant that way.

As the hon. Member for Burnley may be aware, I met a deputation from Lancashire county council just before Christmas to discuss the capital bid. I told its members, as I repeat to the House today, that LEAs have responsibility in law for the condition of their school property and they rightly look to the Government for part, not all, of the means by which they may maintain, improve and ensure the proper state of the structure of those buildings.

Overall, the capital budget that we announced for 1995-96 shows an increase of about 3.5 per cent. although, interestingly, for the LEA schools the increase is 6.2 per cent. year on year, which is also on a base which, for 1994-95, has been somewhat reduced as a result of some schools becoming self-governing. I hope that the hon. Gentleman will see that, within that figure, there is no significant discrimination against LEA schools and that, secondly, a significant sum against the current financial background has been put to one side.

The hon. Gentleman understandably makes the case--I think that I expected it--that he would wish to see still greater sums provided for borrowing, and he will recognise that, if he were an Opposition spokesman, that additional commitment would require the approval of the hon. Member for Dunfermline, East (Mr. Brown). We both recognise that and I submit that the capital budget, within the context of the settlement and public expenditure generally, has been a good one. I think that the hon. Gentleman knows, but I shall simply and briefly adumbrate the priorities drawn up some decade ago in conjunction with local authorities. Briefly, they consist of existing schemes and basic need. The hon. Gentleman mentioned basic need-- that is tightly defined and it is essential that if an area faces the prospect of more pupils than it has likely available places, there is a mechanism by which that can be resolved. That is why it has a high priority within the capital allocations.

Following that is the removal of surplus places, and then essentially the balance is distributed by formula for improvement and replacement. On a comparable basis, we look at all the schemes appropriately. As the hon. Gentleman said, and there is no difference between us on it, it turned out that Lancashire had a total annual capital guideline--ACG as it is termed-- roughly in line with the national average. That is, in a sense, because its bid roughly reflected the national priorities that I have just described.

Mr. Pike: How highly does the Minister rate the need to make alterations to schools to meet the requirements of the national curriculum?

Mr. Squire: I was going to say something about the national curriculum. It is a requirement of law that a

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school delivers the national curriculum. The hon. Gentleman did not say as much, but he might have hinted at it, so I was going to say that the recent revision of the national curriculum did not add to the curriculum, but rather reduced it, so it should not of itself have created the need for greater expenditure. But if the hon. Gentleman is suggesting that a school cannot currently deliver it, that is a serious matter. Without wanting to be repetitious, I should say that responsibility lies with the LEA to ensure that schools can deliver the national curriculum.

I have set out briefly, I hope, the priorities within which capital moneys are allocated by the Government. As the hon. Gentleman is aware, there are other sources open to most councils most years: capital receipts, transfers from revenue and so on. If he wishes separately to pursue that point with me outside the House, I should be happy to go into further detail on it.

I do not wish to reiterate past debates, to which the hon. Gentleman referred, although the comparative figures quoted by my right hon. Friend the Secretary of State for the Environment showed that Lancashire was one of the authorities in England with a relatively high proportion of staff per head. That is simply a question of looking at tables. We do not need to bandy figures across the Chamber. It is neither my responsibility nor, arguably, the hon. Gentleman's, but it is a matter which--if true--the local authority would wish to address when it looks at what is or what it deems to be essential reductions in front-line services.

I now deal with the revenue items that the hon. Gentleman mentioned. He made the point, understandably, that he would like the SSA for Lancashire to be higher. I suppose that it is true to say that every one of the 109 authorities would say the same about its own area cost adjustment. He highlighted what he considers to be unfair--that is, the operation of the ACA. There is no mystery about it. Every single local authority accepts the need for a means to reimburse councils--broadly speaking, they are in London and the south-east--for their inevitably higher costs, not just in teacher salaries, but in staff salaries across the board and a number of other attendant costs.

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I would concede--again, it is no great secret--that although every LEA accepts that there is a higher cost, I do not suppose that any LEA, whether it is a recipient or not, would agree with the specific method of assessing ACA. The hon. Gentleman will know that my right hon. Friend the Secretary of State and my hon. Friend the Minister of State indicated that they are looking further at that for the forthcoming year. I hope that the hon. Gentleman will accept from me that a central drawback of making comparisons between, if one likes, a non-ACA authority and an ACA authority is that one cannot end up saying that it is wrong that Essex should get more money per pupil than Lancashire simply because it gets ACA. It is a fact that the cost of running a school in Essex will be higher than in Lancashire. I concede also that there are other essential costs in running schools. As the hon. Gentleman is well aware, the SSA system seeks to reflect that as well within the overall system, and in some other areas, depending on what they are, Essex receives slightly less per pupil than Lancashire.

The hon. Gentleman mentioned surplus places. He said that we should look at areas where there are not only surplus places but deficiencies. As I have already said, basic need is an essential priority within capital. It remains so. I do not think, therefore, that it is a question of netting off. We expect authorities, in their interests and those of the children and parents, to look at where they can bring forward the removal of surplus place schemes, which are cost-effective. Despite what was said in the earlier debate, the overwhelming majority of those schemes do not result in a significant number of schools becoming grant-maintained or self- governing. They are considered on their merits, and a number of LEAs can confirm that those schemes have been put forward, assessed by the Secretary of State and subsequently approved.

I believe that the hon. Gentleman has done us a service by initiating this short debate tonight--

The motion having been made after Ten o'clock, and the debate having continued for half an hour, Mr. Deputy Speaker-- adjourned the House without Question put, pursuant to the Standing Order. Adjourned accordingly at one minute to Eleven o'clock.

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