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Mr. John Gunnell (Morley and Leeds, South): The Secretary of State has recognised that the change in capital disregards for people in long-term care will have a substantial effect on finances in local government, as we will hear later. Can he guarantee that the disregards will be taken into account for the capping criteria; and that the funds will be adequate? If the funds are inadequate, the Secretary of State will be responsible for the impact on services. What steps has he taken to mitigate the impact?
Mr. Gummer: There have been full discussions on this matter. The announcement and details will be given very soon. I hope that the hon. Gentleman can contain himself till then. If he has further questions, I will be happy to meet him and discuss them.
Mr. David Wilshire (Spelthorne): Is my right hon. Friend aware that Surrey county council has not waited for today's announcement and has been busy telling parents in my constituency that schools in Surrey are likely to receive £8 million less next year? Now that he has announced that the schools will receive £8 million more, how does he rate my chances of an apology from Liberal and Labour councillors?
Mr. Gummer: The chance of getting an apology is poor. Perhaps my hon. Friend should ask his Liberal and Labour opponents to use the same mechanism to circulate to every parent and every school the fact they are getting £8 million more. If they did that, they would not need to apologise, but they might have to explain to parents why they tried to mislead them in the first place.
Mr. Paddy Tipping (Sherwood): Will the Secretary of State consult parents about the settlement? What will he say to parents in Nottinghamshire when they bring to his attention the fact that the county council currently spends 7.5 per cent. or £25 million above the Government guideline on education? The county council will receive, at best, £15 million from the settlement, leaving a budget gap of £10 million. There will be bigger class sizes and fewer teachers, so people will be paying more and getting less. How will he respond to them?
Mr. Gummer: The hon. Gentleman has to say that 3.3 per cent. goes on in addition--it goes straight through. However, he should point out to the leader of his county council that Nottinghamshire is one of the most profligate counties in the country and could give a great deal more to schools if it stopped spending as wildly as it does now.
Mr. Iain Mills (Meriden): Does my right hon. Friend recall our conversation in a similar debate last year, when he admitted that the methodology of the SSA calculation was unfair to Solihull council? Does he now believe that he has corrected that in his statement today?
Mr. Gummer: I am pleased that my hon. Friend reminds me of that occasion, which was not a comfortable one for me because I had real sympathy with Solihull. As he knows, I cannot change individual arrangements as they are made by classes. Solihull is one of a class and the arrangements last year had a particular effect on
Solihull. He will note that the budget can rise by 3 per cent. I have announced an independent inquiry into the way in which we deal with the area cost adjustment, which is particularly important to Solihull. I hope that when it comes through, my hon. Friend will be happier about the arrangements.
Several hon. Members rose--
Madam Speaker:
Order. Despite the fact that the statement has now taken more than a hour, I shall try to call all the Conservative Members who have been standing for so long. Perhaps we can have a reasonably quick exchange as there are two more statements.
Mr. Richard Alexander (Newark):
Would it not be fraudulent of local authorities to use the money directly allocated for schools for some other purpose? Bearing in mind the fact that schools in Nottinghamshire were seriously underfunded last year, surely we should take steps to ensure that the money specifically allocated to schools goes to schools. It is not enough to say that it must be left to parents, governors and local Members of Parliament. We should take a closer interest in ensuring that the money goes to the right quarter.
Mr. Gummer:
My right hon. Friend the Secretary of State for Education and Employment and I will certainly take a very close interest, but there is a difficulty. If one believes in local accountability, local councils must make such decisions for themselves. When I refer to governors, parents and local Members of Parliament, I am talking about local accountability. We have told people quite clearly that they can spend significantly more money on schools. Nottinghamshire can save money in many other ways and spend it on schools, but Nottinghamshire taxpayers will have to press to make sure that the money gets through to the schools. If my hon. Friend knows of any case in which they are not doing so, I shall look at it myself.
Mr. Nigel Forman (Carshalton and Wallington):
Although I warmly welcome the increase of the education SSA by 4.5 per cent. this year, which is generous, has it ever crossed the mind of my right hon. Friend when he was Minister for Local Government or now, as Secretary of State, that the two main weaknesses of the system that we are discussing are its excessive complexity and centralisation? Is it not time that the Government took a long, hard look at those aspects, particularly if my right hon. Friend is sincere--as I presume him to be--in saying that he favours local accountability? Is not the real answer to give local authorities more possibility to take their own spending decisions and then to be held directly to account by their local electorates?
Mr. Gummer:
I have great sympathy with what my hon. Friend says, but there are two problems. First, if local authorities are spending a quarter of the spending of government as a whole, it must have an effect on the ability of national Government to spend. If local authorities were to push up spending, we, national Government, would have to reduce our spending on the national health service, for example, to keep the general economy in shape. There is a real difficulty.
Secondly, money does not necessarily come easily from a local community in the sense that the poorest communities may have the greatest needs but the lowest
rate bases. We need a system that provides a real redistribution of income, which is what the SSA does. There will always be a significant amount of central Government spending, over which we need to have some control. A modest movement, however, in the direction of more money coming from the local community, would be reasonable. In that context I have gone some way towards the Labour party. Its latest policy document, entitled
"Renewing Democracy", states that
Mr. Harry Greenway (Ealing, North):
Has my right hon. Friend taken account of Labour councils such as Ealing, which have substantial reserves from previous Conservative administrations? Will he be pressing for those reserves to be used where that is needed? Does my right hon. Friend agree that following the education settlement for Ealing it will be indefensible for the council to continue its policy of refusing a travel grant to children who wish to travel to schools some way away from home, even if their parents are on income support, on the ground that they could choose a nearer school? Parents have a right not to do so under current legislation.
Mr. Gummer:
I must declare an interest. One of my children attends the local Church school in Ealing. The education provided by that school is very good. I have noticed, however, since Ealing borough council changed hands, that a series of petty and vindictive steps has been taken by the new council, including a step to which my hon. Friend has referred. The council does not like the possibility of parents choosing. I hope that my hon. Friend will join me and other parents to ensure that the money that is provided for Ealing gets through to the schools.
Mr. Eric Pickles (Brentwood and Ongar):
Does my right hon. Friend remember a time when a 4.5 per cent. increase in education SSA would have been welcomed throughout the House? My right hon. and hon. Friends have done even better for Essex, where there will be an increase of 4.9 per cent. That will be worth nearly £26 million, a sum that is larger than some district councils' total budgets. Does my right hon. Friend agree that some of the alibis that we have heard this afternoon-- it has been suggested that there will be no increases--will not wash with parents and head teachers? The councils that do not pass on the extra funding will be rightly brought to retribution.
Mr. Gummer:
It is important for my hon. Friend to ensure that every head teacher, governor and parent in Essex realises that there will be a 4.9 per cent. increase in the funding that should be available for their schools. Essex county council, like Suffolk county council, sought to frighten people by talking about a 5 per cent. decrease. Against that background, Essex county council owes it to parents to write, "Sorry, the figure was not minus 5 per cent. but plus 4.9 per cent.", and to ensure that every penny of the increased funding gets through to schools.
"it would be far healthier for democracy if councils were responsible for raising locally a much higher proportion of the money they invest and spend".
I am interested that Labour Members are prepared to attack any move to increase council tax when they want a "much higher proportion" and we are suggesting a small proportion.
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