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Mr. Dobson: The right hon. Gentleman would prefer "Dear Sir/Madam".

Mr. Gummer: That would be polite, and at least it would not upset the people who received the letter.

I object to the rest of the letter, which shows that, far from extra money being spent on education in Hertfordshire, education will have to make savings. Extra money has been made available, but still savings will have to be made. Much of the money will be used for other purposes.

Local authorities asked to spend more money on education. They said that sufficient money was not made available last time, and that central Government should make sure that it was available this year. We have made additional provision, but Hertfordshire admits that it intends to pinch the money for some other purpose.

Sir Anthony Grant (South-West Cambridgeshire): Is there not another factor in the equation? Not only does Hertfordshire seem unable to run its affairs properly, but it benefits from the area cost adjustment, unlike Cambridgeshire just over the border. Although Cambridgeshire is not a particularly efficient Lib-Lab coalition, or whatever it is called, at least it has the excuse of not receiving an area cost adjustment. I hope that my right hon. Friend will refer to that difficulty.

Mr. Gummer: I congratulate my hon. Friend on finding yet another way in which to refer to the area cost adjustment. I shall refer to it later, and my hon. Friend the Minister for Local Government, Housing and Urban Regeneration will take the point further.

It concerns me that it appears that, all over the country, Labour councils and Liberal-Labour coalitions are taking for granted the figures that their officers give them. They think, "My goodness, we must spend this, that and the other to stay level." They are therefore not accepting that spending is all about priorities. They said that they wanted to spend the money on education, and that they would be responsible in doing so. It will therefore be a real test of whether they say one thing and do another. We shall see.

Mrs. Anne Campbell (Cambridge): Is the Secretary of State aware of the extreme anxiety in Cambridgeshire over his provisional statement that capping in the county would be set at the level of the standard spending assessment? I think that it is only one of two shire counties that have been penalised in such a way.

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I should like to quote Mr. Peter Downes, the head teacher of Hinchingbrooke school in the Prime Minister's constituency. The right hon. Gentleman may be aware of the case. Mr. Downes said:

I am worried about that, and I hope that the Secretary of State is also prepared to express his concern.

Mr. Gummer: The message that the hon. Lady must take back to her area is that Cambridgeshire has the resources to improve its education. If it does not spend them on education, it will be because the Liberal Democrats and the Labour party have misused the money. I understand how difficult it is for her. I would not like to be shackled to the Liberal Democrats. None the less, she is, she chose to be, and she will therefore suffer as a result. Authorities worse run than those run by the Liberal Democrats are difficult to find. I know how hard it is, but all she has to do is give them up. They are not worth associating with.

Sir Peter Emery (Honiton): Will my right hon. Friend consider Devon county council, which is a prime illustration of the terrifying behaviour of Liberal Democrat county councils? It is being given £17.5 million extra, yet in its provisional budget it is allocating only £1.5 million to schools. The rest will be gobbled up by the county council. Is that not disgraceful?

Mr. Gummer: It is not only disgraceful but contrary to what I understand to be Liberal Democrat policy, although I know that that is difficult to define. Although the Liberal Democrats have said that their prime priority is education, they are not planning to use the extra money to fund it. They are planning to use it for a range of other things.

I do not yet know what Suffolk will do, because, like most other Lib-Lab pacts, it has been very careful not to tell anybody in case the schools notice too quickly. I understand that, although it has an allowance of£11.5 million, which it could spend on education, it is planning to spend only £8.4 million on education. I suppose that the rest will go on yet more road signs, since that is the main interest of my local council.

Dame Elaine Kellett-Bowman (Lancaster): As my right hon. Friend knows, Lancashire is a very unpopular county council, and it does not devote anything like as much as it should to education. Unfortunately, although it has received much more money to spend on education this year, it is not spending it on education. Worse than that, money within its education budget does not even go to schools; it goes to staff at county hall.

Mr. Gummer: My hon. Friend makes a fair point, which no doubt she will want to take up with every school in her constituency and in Lancashire as a whole.

Lancashire appears to have a great deal of money to spend on lawsuits. I wonder whether it should spend some of that money on education, rather than on its continual attempts to use the law courts to implement policies that have not been accepted by the generality of the people.

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Sir Irvine Patnick (Sheffield, Hallam) rose--

Mr. Michael Clapham (Barnsley, West and Penistone) rose--

Mr. Gummer: I give way to my hon. Friend, and then I shall give way to the hon. Gentleman.

Sir Irvine Patnick: Is my right hon. Friend aware that, once again, Sheffield states that it will spend more than its standard spending assessment on education, and claims that its 2.1 per cent. is lower than those of the other three districts in South Yorkshire and much lower than metropolitan councils?

Mr. Gummer: I am aware of that, but, on a list of councils, one is bound to be lower than others. I try to apply these objective criteria--[Interruption.] The Association of District Councils agrees that they are objective. The methodology is agreed with all three Labour-controlled councils.

County councils would like to place more emphasis on one part of the methodology than district councils, because they do better out of it. District councils would like another shift, whereas metropolitan councils or the London boroughs would like a different one. That is perfectly reasonable.

The only people who disagree are Opposition Front Benchers, and I think that only one of them does so. That Opposition spokesman does not understand the system, which is why he finds it so difficult to accept--[Interruption.] I shall just have a word with the hon. Member for North-West Durham (Ms Armstrong), who has not been responsible for this subject for very long. I remind her that the hon. Member for Holborn and St. Pancras (Mr Dobson) is always--[Interruption.] I would like her to listen, because I always thought that she was fair-minded, but she has obviously joined the giggling fraternity.

Westminster city council did very much better under the system that applied when Labour was in power than it does under the present objective system. Labour's system was devised by the hon. Member for Blackburn (Mr. Straw), who used, with considerably greater power, to perform the job that the hon. Member for Holborn and St. Pancras now does.

We accept that the system is objective. Sheffield has rather less than others only because the measurement of its need has been lower than that of its neighbours. If only Sheffield was not saddled with the debts that the hon. Member for Sheffield, Attercliffe (Mr. Betts) and his predecessor, the hon. Member for Sheffield, Brightside (Mr. Blunkett), landed it with, it would be able to spend its money on other matters; but despite that, Labour Members tell us how we should run national finances.

Mr. Clapham: The Secretary of State said that the TSS figure of £44.923 is a 3.3 per cent. increase. He will be aware, however, that, when that is deducted from the cost of local government reorganisation, community care and the police, it falls to 2 per cent. As the Government's forecast for inflation is 2.75 per cent. for next year, that works out as a decrease of 0.75 per cent.

Mr. Gummer: The hon. Gentleman knows perfectly well that we certainly expect some savings to be made--the idea that they cannot be made is largely a Liberal one.

31 Jan 1996 : Column 1020

I visited Liberal-controlled Richmond, which said that it had already made enormous savings and challenged me to see whether I could find further savings. The Liberal leader of Richmond council gave me an exhibition of slides on the wall. The first one was designed to show the enormous savings that it had made. In fact, it showed that, year on year, it had made budget increases--the savings were not there at all. When I asked him what he defined as savings, he said, "Not doing something that we used to do." Then they take the money and spend it somewhere else--and that is counted as a saving. The slides designed to show how the council had cut, cut and cut again, showed instead how it had spent, spent and spent again.

When I went through the savings that could be made, it turned out that the council had not even considered the possibility of collecting the rubbish from front doors rather than back doors, or of going out to private contract in many areas in which it was not forced to do so. It had not even looked at a whole range of mechanisms whereby expenditure could be reduced.

The authority really needed to consider those savings, because, as my hon. Friend the Member for Twickenham (Mr. Jessel) has said, it has a real problem, in that it has entered into a very long-term contract for waste disposal, giving it less flexibility there. I only wish that it had found the flexibility elsewhere, instead of saying that it had got everything right and tickety-boo. Even Ealing, unlike Richmond, has discovered some of those savings. That man had been in power in the authority for 13 years, yet he had failed to find even those fundamental and simple mechanisms.

During our discussions with local authorities, we have agreed to add to the figures that I have mentioned additional funds that they will receive through a special grant to offset the income lost through changes to capital disregards for community care provision. The arrangements for that special grant will be laid before the House in due course.

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