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Since the correspondence to which I have referred, I have received a flood of letters from concerned parents who are anxious about the welfare and future education of their children. Typical of those is Mrs. A.E. Morris of 16, Llanwern road, Newport. She writes: "My daughter Sian and my son Rhys both attend the above school,"--

St. Gabriel's--

"I am concerned to learn that because of rules which govern funding, St. Gabriel's is to lose a teacher . . . which I find totally unacceptable."

She calls for "swift and appropriate" action to remedy the situation. I heartily endorse that.

The situation in St. Gabriel's has happened and is happening in other schools in Newport. Indeed, the education cuts in Newport are mirrored throughout the country, as we have witnessed in the debate this evening. Yet education is vital to social cohesion and social justice, about which the Prime Minister claims to be so concerned. I am reminded of the words of Dickens in "A Tale of Two Cities": "It was the best of times, it was the worst of times". Let us update those words a little. It is certainly a good time for Sir Iain Vallance, the chairman of British Telecommunications plc. I did a little research in the Library on his remuneration and emoluments and found that, up to 31 March 1994, he received a salary of £465,000 plus bonuses of £185,000. Other benefits total £13,000, making a total of £663,000 per annum. He also had pension payments of £43,000 and what are known as "unfunded" pension contributions of a further £51,000. He had shares amounting to £17,084 and share options totalling £612,659--

Mr. John Carlisle (Luton, North): On a point of order, Madam Deputy Speaker. I wonder whether you can help me on the relevance of what the hon. Member for Newport, East (Mr. Hughes) is saying to the debate on the financial settlement for schools 1995-96.

Madam Deputy Speaker: I am usually fairly tolerant when hon. Members make a passing reference or seek to make some short comparison. I am less happy when it becomes extended and the main point of the debate becomes lost. The hon. Member for Newport, East is fast getting to that point.

Mr. Hughes: I have come to the end of the point that I wanted to make. I would say, however, that, compared with Sir Iain Vallance of BT, it is not so good for the children in our state schools at the present time, particularly those in socially deprived areas, as I have illustrated in the case of St. Gabriel's Roman Catholic primary school in Newport.

It is time for the Government to loosen the purse strings and to change their policies root and branch, otherwise the classes will "shoot up"--to use the words of the present Secretary of State for Education. Instead, though, the Government are carrying out a policy of austerity, with a view to creating some sort of economic bonanza, as we approach the general election. The education of our children is too important to be treated in that way. After 15 years in office, the Government are unlikely to change. The leopard does not change its spots. It is time for the Government to give way to a Labour Administration, who will fully recognise the importance of education and fund it accordingly.

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6.24 pm

Mr. Patrick McLoughlin (West Derbyshire): I do not want to follow the speech of the hon. Member for Newport, East (Mr. Hughes), but I would say to my hon. Friend the Minister of State that I do not want him to depart from the policies that the Government have maintained since 1979, because to do so would mean reversing the increase of nearly 50 per cent. in spending on schools that we have seen. I very much support increasing funding for schools when the economic climate allows. The very fact that we have managed to do that since 1979 is a tribute to the way in which we have run the economy. We have not had to introduce massive slashing programmes, as happened in 1976 when the Labour party was in Government. That is what we inherited. I urge my hon. Friend, therefore, to pursue with vigour the policies that the Conservative party and the Government have followed. They are the policies that are condemned by the Opposition one day but held up the next as though they invented them. We have seen that time and again. Indeed, I read at the weekend of the chief education officer in Liverpool, who last year sent a letter to all parents telling them that schools should not become grant maintained, only to send his own child to just such a school. That is the kind of educational hypocrisy that we hear from the left of the Labour party these days.

I pay tribute to all the teachers in our schools who work so hard to achieve the improvement that we have seen in examination results. It is a credit to the parents and to the teachers. Some of the nonsensical decisions have been removed from local education authorities as a direct result of the policy which allows schools to become grant maintained and thus freed from the shackles of the local authority.

In March 1987, when I had just entered the House, my hon. Friend the Member for Dartford (Mr. Dunn) answered an Adjournment debate. Some 170 parents came and sat in the Strangers Gallery to exercise their right to make representations through their Member of Parliament and to the Minister about the saving of the sixth form in Ecclesbourne school. It was one of the first schools in Derbyshire to become grant maintained. What the county council tried to do--to take away the sixth forms--was nonsense. That school has gone from strength to strength since becoming grant maintained.

Mr. Harry Barnes (Derbyshire, North-East) rose--

Mr. Enright rose--

Mr. McLoughlin: I understand that Netherthorpe school is in the constituency of the hon. Member for Derbyshire, North-East (Mr. Barnes). The head of that school, which is now grant maintained, recently said:

"We have been grant-maintained for 4 years. The advantages include: more effective decision making; money nearer to the students (more books; equipment; teachers; non-teaching staff; better maintained buildings). Better staff training. Increased parental support."

I think that we should be shouting from the top--

Mr. Barnes: On a point of order, Madam Deputy Speaker. As I am in the House, is it in order for the hon. Member for West Derbyshire (Mr. McLoughlin) to comment on a school in my constituency but not to give way so that I can make a counter-argument?

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Madam Deputy Speaker: That is not a point of order for the Chair. The tradition of the House is well known: it is up to the hon. Member who has the Floor to decide whether to give way.

Mr. McLoughlin: The problem, Madam Deputy Speaker, is the shortness of time.

Over the past 14 years, Derbyshire county council has subsidised school meals to the tune of some £100 million. When I challenged the hon. Member for Sheffield, Brightside (Mr. Blunkett) on that matter, he said that he was informed that I have not been short of school meals. Indeed, I have not--nor, I suggest, has his hon. Friend the Member for Liverpool, Walton (Mr. Kilfoyle), who will shortly be winding up for the Opposition. The hon. Member for Brightside did not comment at all on whether he thought that it was a good thing that Derbyshire had expended some £100 million in the past 14 years on subsidising school meals. If that £100 million had been given directly to schools, Derbyshire's education would be in a far better state today.

Derbyshire allocates less to schools than any other shire county. There is more money to be allocated to schools. Before talking about cutting the number of teachers, Derbyshire should ask itself whether its administration is as efficient as it might be. We have a right to ask why it is not giving money directly to schools.

Mr. Barnes rose --

Mr. McLoughlin: The hon. Gentleman has already asked me to give way. He must realise that I cannot do so, because the winding-up speeches are about to begin.

I end by saying that the flexibility is available to allow county councils to put more money into schools.

6.30 pm

Mr. Peter Kilfoyle (Liverpool, Walton): I congratulate my right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley) on the way in which he speared the Government. I also congratulate my hon. Friends the Members for Bristol, East (Ms Corston), for Warwickshire, North (Mr. O'Brien), for Barnsley, West and Penistone (Mr. Clapham) and for Newport, East (Mr. Hughes), who--unlike many Conservative Members--did what a Member of Parliament is supposed to do: they defended the interests of their constituents, and they did so very eloquently.

When the right hon. Member for Oxford, West and Abingdon (Mr. Patten) was replaced by the right hon. Member for Norfolk, South-West (Mrs. Shephard) as Secretary of State for Education, many saw the right hon. Lady as a lamb going among the educational wolves. She was to be the great conciliator-- the professional whose experience and commitment would correct the imbalance caused by the disastrous tenure of her predecessors. The right hon. Lady came as sweetness and light to the chaos inflicted on pupils, teachers, parents and governors, and her initial input appeared benevolent. She rapidly moved on to ground long occupied by the Opposition Front Bench: she cleared the confusion over the Government's intentions in regard to standard attainment tests and amended the national curriculum following the excessive demands originally made by the Government. The commentators spoke of the refreshingly engaging style of

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the Secretary of State--a person who was at home in the job, far removed from the ideologues in her party who pressed for ever more radical change for its own sake.

All of that was dispelled by the leaking of the Secretary of State's letter to the Chancellor of the Duchy of Lancaster. She was revealed in that letter, which was printed in full in The Times Educational Supplement on 20 January, as--I hope that the right hon. Lady will pardon the pun--not a lamb but, in education terms, a wolf in chic clothing. That missive contained a clinical analysis of the political cost to the Government of the 1995-96 education settlement; nowhere was there a hint of the huge educational loss to our country, the frustration of parents, the undermining of teachers, the disenchantment of governors or the injury to pupils. What the Secretary of State did say, unequivocally, was that--as my hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett) pointed out --up to 10,000 teaching jobs would go, and class sizes would rocket. Even when she wrote that letter, the right hon. Lady knew full well what the results of the Government's parsimony would be. It

"would be seen as provocative",

she wrote; there would be

"a renewed battle with the teachers".

Crucially, she concluded that

"it would be a great pity to lose the ground we have gained and face new disruption in our schools".

How right she was.

It appears, however, that the Secretary of State's political plea has fallen on deaf ears. The long years of confrontation in education were prematurely written off. According to The Times and The Daily Telegraph today, the Government are about to take on not only the teachers but the school governors, which will mean increased turmoil for our children--to the outrage of their parents. Those parents know exactly whom to blame. The Secretary of State herself said:

"Pupil numbers next year will go up by 1.5 per cent., so an increase"--

in education spending--

"of 0.3 per cent. implies a cash fall. The increase could make no contribution towards any pay award: staffing ratios will have to be tightened to balance the books before LEAs even start to consider how to fund the pay settlement".

The Secretary of State said much in her speech today about the bureaucracy which allegedly remained in local education authorities. She had the temerity to quote the Office for Standards in Education, so I will do the same. According to paragraph 224 of Ofsted's report,

"Almost all LEAs have experienced significant reductions in staff numbers in the last five years."

Paragraph 226 states:

"Where budgets were reduced, LEAs generally sought to protect schools by improving economies in their own administration cost". Paragraph 227 states that support services are

"extensively used and generally valued by schools, including grant- maintained schools."

It does not seem to me that Ofsted was condemning LEAs: quite the reverse-- it was giving credit where it was due and praising LEAs which do a tremendous job in difficult circumstances.

Peculiarly, given the way in which the Government have operated historically, the shire counties are likely to be hit most heavily. Essex has had £1.4 million cut from

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its assessment, but faces an extra bill of £8.5 million, which means a £9.9 million shortfall. Northumberland will face a similar shortfall of £5.4 million.

Mr. Jack Thompson (Wansbeck): That figure is correct. Northumberland has a special problem, because it operates a three-tier system. Four fifths of the population live in one corner, while the remaining one fifth inhabit the rural parts. If schools in Northumberland are closed, they will be closed in the rural parts, which are Tory dominated.

Mr. Kilfoyle: It is a sad fact that rural areas will be hit as much as metropolitan areas were in the past, although metropolitan authorities will suffer nearly as much: Birmingham faces a shortfall of £8.1 million, and St Helens a shortfall of £4.9 million. As the hon. Member for Rugby and Kenilworth (Mr. Pawsey), a noted educationist, is present, I will also cite Warwickshire, whose 300 schools have £57 million in unspent balances. Unspent balances are part of the Government's argument, but Warwickshire's balances are unevenly spread: one third of schools have no balances, one third have modest balances of between 2 and 3 per cent., while the remaining third hold sufficient reserves to cater for the worst effects of the 5.8 per cent. reduction in the real value of their budgets in 1995-96 but nothing for 1996-97. The council estimates that between 140 and 200 teaching jobs will go, probably to be joined by 23 section 11- funded jobs. In addition, class sizes will go over the 40 mark.

Croft middle school in Nuneaton represents a microcosm of Warwickshire's dilemma, which in turn epitomises what is happening throughout the country. It is a popular school, oversubscribed by 19--if we take the standard number--with a roll of 299. A special educational needs audit under the new code of practice, using nationally recognised criteria, revealed 134 children--some 43 per cent.--with level 1, 2 and 3 needs. The school has reserves of £14,523, but those reserves are already committed to teaching and support services for the final quarter of the school year 1994 -95--not the financial year. Its budget allocation in 1994-95 totalled £425,385. Its allocation for next year, including the allowance for extra pupil adjustment, will be only £400,235. In real terms, that means the loss of two teaching posts to a middle school in middle England-- 12.4 posts rather than 14.4--and huge classes.In 1994, the fifth year in the school contained classes of 27, 26 and 29; in 1995 there will be two classes of 38 and 39. In year six, there were two classes of 35 and 34 in 1994; those will become two classes of 41 each in 1995. How does that relate to the Secretary of State's proclaimed wish for stability in our schools and the raising of standards?

Reference has been made to the role of the Treasury and the Chancellor of the Exchequer. I hope that the Chancellor will feel able to go along to Abbey Road primary school in his constituency and explain why it will lose £21,000 next year--or perhaps he should visit Cotgrave Highfield primary school, which will lose £20,000. A total of £442,000 will be taken from 41 primary schools in the Chancellor's constituency to fund tax cuts at the next general election. But even that is generous compared with what is happening in secondary schools in the Chancellor's constituency. They are to lose

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£551,000 between them. Does he think that voters' memories will be so short as not to take note of that when the election comes? There will be less chance to address the problems of literacy and numeracy, which were highlighted by the adult literacy and basic skills unit. In recent years, the reading age in primary schools has dropped. The fresh round of cuts will do little to remedy that. If we end up with disenchanted, harassed and undermined teachers, and with even less one-to-one contact with children most in need, the graph will continue to plummet.

It may not be popular with Conservative Members to say so, but the settlement is an unwarranted imposition on teachers and it must be set in the context of other cuts in education, including £20 million from school effectiveness grants and £13 million from the planned inspection budget. As my hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett) said earlier, the reading recovery programme has been scrapped. Discretionary grants are all but a thing of the past. The youth and community service has been decimated. For example, a delegation from Shropshire could not get a hearing from Conservative Members, so it came to see me in Liverpool about 15 mainly rural youth and community projects that were being scrapped in the face of cuts imposed by the Government. Nor are Labour authorities left out: Wigan district council has been forced to dismember its youth and community provision, and to subsume it into leisure services to have any hope of providing any service for some of the more alienated sections of our community--the young and the disadvantaged. The sorry tale goes and on, but I must comment on some of the speeches that were made earlier.

The hon. Member for Gravesham (Mr. Arnold) made a disgraceful attack on Kent county council. He was joined by the hon. Member for Dartford (Mr. Dunn), who in interventions made laudatory remarks about grant-maintained schools. He talked about the waste of money that had been perpetrated by Kent county council. I also had a delegation from his constituency. It came to see me because four schools in his constituency, two of which went grant maintained, were sharing the same playing fields. According to the parents, they could not interest the hon. Gentleman because one of the GM schools had managed to separate off six out of the eight football pitches and to put up a huge fence. While that was going on, the hon. Gentleman sat on the fence--although I hope that he did not literally sit on the fence that the school put around the playing fields as it has been topped by razor wire. That is the sort of education in the community that the Conservative party cares for.

I appreciate the pressures of time, but I should like to mention the attack by a series of Conservative Members, mainly in interventions, on Lancashire county council. They failed to point out two important facts: first, Lancashire has a £2 million shortfall in the forthcoming year; secondly, the cuts in the standard spending assessment per pupil next year mean expenditure cuts of 2.6 per cent. for primary school pupils and 7 per cent. for secondary school pupils. You can go back and explain that to your constituents: those cuts are not down to Lancashire authority--they lie entirely at the door of your own Government.

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Madam Deputy Speaker: Order. I remind the hon. Gentleman that he must address the Chair.

Mr. Kilfoyle: I apologise, Madam Deputy Speaker.

Mr. Mans rose --

Mr. Kilfoyle: I must finish my speech.

The hon. Member for West Derbyshire behaved disgracefully in attacking a neutral civil servant, the chief education officer of Liverpool city council who, so far as I am aware, is a member of no political party, does not live in the city of Liverpool and sends his fourth child to the local school, which is not in Liverpool, but in the constituency of the Chancellor of the Duchy of Lancaster. I believe that that officer's local school is grant maintained. For him to be attacked in the Chamber as an extension of the Labour party is disgraceful.

The hon. Member for West Derbyshire also made a facetious comment about school dinners and pointed in my direction. I am the first to admit that I enjoyed school dinners so much that I used to go for more in the holidays. The reason was simple: when I was a child, local authorities could provide deprived families with school dinners in the holidays. Now local authorities cannot even provide school dinners for kids in need in the towns and countryside of this once great nation. I hope that the hon. Gentleman will take that on board.

I urge hon. Members to support our motion.

6.44 pm

The Minister of State, Department for Education (Mr. Eric Forth): From time to time, the debate has been informative, but the main thing of which the House has been informed is how few Opposition Members have bothered to turn up for their own debate on a subject that they claim is important to them. I have been watching throughout the debate, and I have counted as few as two or three, to often as many as six or seven Opposition Back Benchers in attendance. That illustrates something about their motivation.

That also demonstrates the confusion of thought among Opposition Members. I shall take one example. I made a careful note of the words of the hon. Member for Barnsley, West and Penistone (Mr. Clapham)--I made a note of the few words of Opposition Members that I thought were worth while. His words, however, were instructive. He opened his remarks by saying, "Standards in the maintained education sector have fallen." He followed that a few minutes later by saying, "Things have been steadily improving in Barnsley schools." The hon. Gentleman cannot have it both ways. He should either join us in taking pride in the improvements that have taken place in education consistently in the past several years, or he should maintain the opposite view. He cannot have both views.

Mr. Clapham rose --

Mr. Forth: He will now try to square the circle.

Mr. Clapham: The point that I clearly made, and that the Minister should take on board, is that the siphoning off of resources for the private sector clearly leaves Barnsley having to make up the shortfall because of a lack of funding from the Government.

Mr. Forth: The hon. Gentleman neatly makes the other point that I wanted to make about the debate. He

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epitomises the confusion that exists among Opposition Members about the connection between spending and educational quality. However one considers education, whether in relation to the results in our much-welcomed performance tables, to expenditure per pupil in different authorities, to class sizes or to any other measure, no demonstrable connection exists between money in and quality of education out, or between class sizes and quality of education. The real determinants of the quality of education in this country, as elsewhere in the world, is the quality of teaching, what happens in the classroom and the degree of parental support. It is not simply about money, which Opposition Members seem unable to grasp.

Mr. Blunkett: In that case, why is the money spent by parents on private day education twice as much as the money made available for the equivalent education in the average state school?

Mr. Forth: I have always defended the absolute right of parents to exercise their choice in sending their children to schools. I personally chose to send my children to state schools. I was happy to do so and I believe they received a good education, but I equally welcome those of my hon. Friends, colleagues and others outside who make the personal decision to send their children to private schools, for whatever reason. It is their decision and their choice. We have confusion among Opposition Members. The proportion of primary pupils in classes of more than 30 has fallen from 26.5 per cent. in 1979 to 23.2 per cent. now. The proportion of secondary pupils in such classes has fallen from 9.9 per cent. in 1979 to 5.3 per cent. now. Many of my hon. Friends have quoted the figures about real expenditure in education since 1979. We take 1979 as our starting point because that is the last time Opposition Members were in Government. That is the only way in which we can judge their real commitment to education. On any indicator one may choose, things are significantly better now than they were in 1979.

Mr. Don Foster: If there is no connection between "cash in and performance out", why has the Secretary of State urged her Cabinet colleagues to give more money to the education service?

Mr. Forth: It is clearly one of the functions of Government Departments to make a perfectly legitimate argument for their expenditure, something that the hon. Gentleman cannot and probably never will understand. It is something normal and natural which occurs every year and throughout Government. For the hon. Gentleman to give it such mystical significance shows that he has missed the point entirely.

The real point of the debate is this: it must be understood that local education authorities have enormous flexibility and freedom in the way in which they can determine their priorities and expenditure within their overall totals.

Mr. Rupert Allason (Torbay): Does my hon. Friend agree that it might improve the way in which local authorities set their budgets and publish their figures if they declared precisely which items of expenditure related to statutory requirements and which related to non-statutory requirements? At the moment, when

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constituents look at local authority education budgets, it is very difficult for them to determine which items of expenditure are required by law and which are the result of good old- fashioned socialism.

Mr. Forth: My hon. Friend raises a very important issue which leads me to my next point.

One decision that authorities must make is how to allocate their expenditure. My hon. Friend the Member for Gravesham (Mr. Arnold) gave us a graphic example of this. He told us that Kent had chosen to increase its education bureaucracy by nearly 200 members of staff. In other words, it increased not the number of people in the classrooms but the number in the county council buildings. My figures also show that in Devon, for example, the number of local authority staff has gone up by some 700; in Oxfordshire, numbers have increased by more than 200; and in Warwickshire by nearly 500. My hon. Friend the Member for Taunton (Mr. Nicholson) told us that in Somerset the number of non-education staff--not teachers--has also gone up by some 500.

It is for local authorities to make such decisions, but they cannot at the same time cry wolf and, having increased the number of bureaucrats, say that they are forced to cut the number of teachers. They cannot have it both ways.

I now cite other recent examples, culled at random from newspapers, about priority spending decisions made by authorities across the country. The Birmingham Evening Mail of 3 February carried an article with the headline "City Row On Hyatt Takeover". It stated: "City Labour leaders want to buy a majority stake in Birmingham's luxury Hyatt Hotel".

That seems to be the sort of priority adopted by one local education authority. It is also reported:

"Birmingham schools were accused last year by the National Association of Schoolmasters/Union of Women Teachers of hoarding £17 million in their combined reserves.

One school in Erdington was said to have had a surplus of more than £400,000 stashed away."

The Manchester Evening News stated:

"Schools in Salford are under threat from huge cuts despite the council having a staggering £13.5m in reserves . . . Some members of the ruling Labour group believe the surplus should now be used instead of making devastating savings in town hall departments." However, it is not all bad news. Also in the ever-instructive Manchester Evening News , but on 24 January, I found a good news story entitled "Hard-up heads' £1 million lift". The article states:

"Hard-up headmasters in Oldham are likely to get a surprise £1 million boost for the coming year.

The increase will be recommended to a meeting by the education committee next month by chairman Coun David Jones."

That illustrates a different point. If authorities choose to make such priority decisions, it proves that many could increase the money spent on education if they had made sensible use of their balances and decided to give education sufficient priority.

However, it is not only authorities that can make such priority decisions. Schools also have the same degree of flexibility. Thanks to delegated budgets and the local management of schools, which were eventually praised by

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many Opposition Members, schools have the capacity to order their priorities and make their own spending decisions to a very large extent.

Mr. Dennis Turner (Wolverhampton, South-East): Although the Minister might challenge it, the evidence from the midlands is very different. We have a £70 million deficit; we are going to lose 1,000 teachers; and there is no question but that class sizes will increase. Governors and parents in the west midlands will not accept the Minister's red herrings because they know the reality of the underfunding from which their schools are suffering.

Mr. Forth: The hon. Gentleman is mistaken on a number of points. He has completely forgotten the example of the Hyatt hotel. If one of the Labour-controlled west midlands authorities wants to make that sort of spending decision, it is open to that authority to do so, but it has to account to its electors. The hon. Gentleman should not come to the Chamber and complain about the cuts threatened as a result of that decision.

I have been in the Department for Education long enough to have reached my fourth year of hearing whingeing and cries of wolf. I have heard the story so often that I can repeat it in my sleep. Every year the story is that there will be devastating cuts in the number of teachers. We have yet to see those cuts; every year, the number remains broadly the same across the country.

Mr. Hattersley: If this is all whingeing and cries of wolf, and if there is so much money sloshing around in the system--I see that the Minister nods his head in confirmation--why did the Secretary of State write to the Chancellor of the Duchy of Lancaster to say that without an extra £90 million there would be chaos in the education service?

Mr. Forth: Of course, the Secretary of State has to make her case for her Department, as does every other Secretary of State. If the right hon. Gentleman's memory goes back that far, he will probably recall doing the same when he was a Secretary of State, except that at that time, in 1976, cuts were forced on the Labour Government by the International Monetary Fund which led to deep cuts in spending on education, health and the whole spectrum-- [Interruption.]

Madam Deputy Speaker: Order. The class is getting distinctly unruly. I cannot hear the Minister and I wish to do so.

Mr. Mike O'Brien: On a point of order, Madam Deputy Speaker. You are well aware of the rules governing the making of controversial comments about other hon. Members. It appears that the Minister is saying that the Secretary of State might not have been telling the whole truth when she wrote that letter.

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