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It is ironic that the Bill abolishes grant-maintained schools, yet introduces very similar powers--the same powers in relation to employment--for education action zones. The Government tell us that an individual school cannot set itself apart from the local education authority and cannot remove itself from the strictures of the LEA, although many schools have done that with enormous success. The Government say that individual schools can no longer do that, but if the school gets together with two or three others, they can form what the Government call an education action zone and do that.

In the debate in Committee, we were told--by the Under-Secretary, as I recollect--that the EAZ was a new structure for education for the new millennium, and that we must stop thinking in the old way about schools being under an LEA. We must drop those ideas and start looking

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at new ways in which schools can come together and find new ideas on providing education for the children who choose to go to those schools.

Despite all that, we see from the Bill that the Government are not prepared to go that extra step. They say that EAZs are an innovative model and the new way forward, but they are not prepared to give EAZs all the powers necessary to do whatever they--the EAZs--consider appropriate to improve the standard of education in schools in that zone.

Amendment No. 88 would put into practice what the Government seem to have been saying in the early stages of the debate on EAZs. It will be interesting to hear how the Minister of State responds. The idea of EAZs and the powers given to them in the Bill are at the boundary between new Labour and old Labour. How far are the Government willing to go, to put into practice what they proclaimed about innovation in education for the new millennium? If they are committed to innovation, they will accept amendment No. 88, give education action zones full powers, especially in regard to employment, and enable EAZs to set themselves up as innovative groups of schools that are ready to consider new ways of providing a high standard of education.

Mr. St. Aubyn: I apologise for not being present for the beginning of the debate, but I was present during the Committee stage and am aware of some of the issues involved. I should be grateful if the Minister clarified a particular point. We shall have a debate later on grant-maintained schools. Having spoken at length to representatives of grant-maintained schools in my constituency, I know that they have severe doubts about the option of having foundation school status. We have discussed the idea of those schools forming an education action zone.

Will the Minister confirm that education action zones are not just for areas where the education system is seen to be failing, and that they are applicable to areas where a group of schools are striving for excellence? For whatever reason, those schools may not see control and regulation by the local education authority as their preferred route, and may see an interesting and exciting future in the new EAZ mechanism. Will he confirm that, under the Bill, it will be possible for such a group of schools to undertake that exciting initiative?

Mr. Byers: I shall start by replying to the hon. Member for Guildford (Mr. St. Aubyn). I confirm that nothing in the Bill restricts education action zones to any particular type of school, whether it is underperforming, underachieving, or whatever. The Bill provides a mechanism to allow education action zones to be established.

The Government are looking to establish five EAZs with effect from September, and increasing that number to 25, probably by the autumn of next year. As we consider the applications that are submitted, we shall want to achieve a good geographical spread of EAZs, mixing urban and rural areas, and different types of school. The important aspect of the EAZ concept--this addresses some of the points raised by the hon. Member for Maidenhead (Mrs. May)--is that we see EAZs as the test bed for the schools service of the next century. That is why we want groups of schools, perhaps in partnership

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with local authorities or with the private sector, to come forward with new and exciting ideas. We want to examine ways in which we can empower schools.

Our earlier debate underlined the fact that schools have the primary responsibility for raising standards. If, through the EAZ concept, we can engage and motivate schools of whatever type, the Government are prepared to facilitate that and support schools that want to take advantage of the freedoms that might be made available in the EAZ.

That is why the three Government amendments are important. Government amendment No. 85, which I mentioned in an intervention in the speech of the right hon. Member for Charnwood (Mr. Dorrell), makes the EAZ accountable as an employer for the decisions that it makes in relation to the people whom it legally employs.

Government amendment No. 86 gives the Secretary of State the power to approve or reject applications to disapply the national teachers' pay and conditions document. We consider it appropriate for the Secretary of State to have that power, because we want to monitor carefully a new teachers' contract and a new system of remuneration for teachers. The Secretary of State needs to be involved in that process, so that we can see what works and what does not work so well.

Mr. Willis: That matter concerns many teachers. As my hon. Friend the Member for Bath (Mr. Foster) has made clear, we support the general principle of the Government's proposal, but if, after three or five years of an education action zone, when there has been a disapplication of conditions of service and there are new rates of pay, will the Government underwrite those new conditions of service and rates of pay if the EAZ completes its work, or will it be the job of the LEA to do that? How will we assure teachers working in the schools that will move into those EAZs that their pension rights and future pay and conditions will not be jeopardised by what could be a glorious experiment for Nord Anglia?

Mr. Byers: The Government fully understand those concerns. When we deal with amendment No. 122, tabled by the hon. Member for Bath (Mr. Foster), we shall state clearly that there will need to be proper consultation with teachers, with their representative organisations and with local education authorities as employers about the changes that a forum might want to introduce in teachers' pay and conditions. We want people to be involved, so that they can express views on those pressing matters. We want a system whereby in three or five years, those teachers will be entering a quite different world from that of 1998.

I should be surprised if we did not look differently at teachers' pay and conditions in the light of the experience of EAZs. They are the test bed for the schools system for the next century. Changes will arise as a result of the initiatives that take place in the EAZs.

It is interesting to note that the advice that I have from my civil servants is that amendment No. 88 is redundant because the powers that it seeks to introduce are in the Bill as a result of the powers that we intend to give the education action forums. The point of the education action forum is that its powers are ceded from individual governing bodies. That makes the point that governing bodies are agreeing voluntarily that their powers should be given up to the education action forum. The education

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action forum can then act almost as a collegiate governing body. It will have all the powers that an individual governing body has at present. It could buy in specific services--for example, managing the payroll, running specialist literacy programmes and providing school meals.

Those are modest measures, and if this is to be an exciting initiative, we must go beyond them. It is most important that the education action forum is responsible for determining the aims and objectives of the schools for which it has responsibility; for monitoring and evaluating the schools' performance; for raising standards of educational achievement through determining the schools' strategy for improving performance; and for setting targets and taking any necessary action to support them.

It will be for the education action forum to decide who is best placed to achieve those objectives. If the education action forum takes the view that Nord Anglia or Procter and Gamble--given its good experience in America--is best placed to deliver those objectives, there is nothing in the Bill to stop the education action forum doing that.

Mr. Dorrell: That is crucial to the argument. The Minister is saying that the education action forum will have no powers that are not currently vested in governing bodies, because all the powers of the education action forum will be delegated to it by the governing body. Is he therefore saying that any governing body in the maintained system already has the power, if it chooses, to subcontract the management of its school to Nord Anglia?

Mr. Byers: It depends on exactly what the governing body wants Nord Anglia to do. At the moment, it could put payroll management or specialist literacy services out to Nord Anglia. The framework that we have inherited from the previous Administration places restrictions on exactly what governing bodies can do. As a result of the new framework, an education action forum will have the power from September next year to contract out to Nord Anglia or Procter and Gamble, to deliver those services and to meet objectives. Legally, it will be able to do that.

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