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Mr. Jenkin: We are entitled to point out that the forecasts for the financing proposals for the original channel tunnel rail link were thrown out of kilter by the fire--[Hon. Members: "Oh!"] Oh yes. To be fair to LCR, it should be emphasised that, until the fire, the company was broadly on track in financial terms, but the financing arrangements were thrown off by the fire.
Mr. Caborn: I shall not respond to that intervention, except to say that I think that the hon. Gentleman is being slightly economical with the truth. I shall let hon. Members arrive at their own judgment.
We are determined to ensure that the review takes proper account of the views of all interested organisations. We shall therefore instruct the firm of consultants appointed to consult, among others, the Local Government Association, the regional development agencies, and the Fast Tracks to Europe Alliance, to ensure that the views of the regions are properly represented.
There has been concern about Eurostar's reported plans for the regional trains sets and the drivers whom Eurostar employed to operate regional services. The Government understand and share the disquiet that has been expressed about Eurostar taking decisions that might pre-empt the Government's review. However, I assure the House that, although the trains are owned by Eurostar (UK) Ltd. and decisions on their use fall to the company, the Government have agreements in place that prevent assets from being used outside the Eurostar business without the consent of the Secretary of State. That power may well be used.
The Eurostar business is defined as the operation of international passenger services. We have made it clear to Eurostar that any plans it has for alternative uses of the
regional train sets must be within the terms of the agreements that it has with Government and that it must not pre-empt the Government's review. Eurostar clearly understands that.
One alternative use of the regional train sets that I understand Eurostar is considering is their lease to domestic train operators--a point made by several of my hon. Friends. That option was encouraged by the Sub-Committee in its report, and I understand that Eurostar has already approached Virgin, Great North Eastern Railway, Connex, South West Trains and GB Railways to see whether they would be interested. As I have said, under the agreements we have with LCR, the lease of the regional rolling stock to domestic rail operators would be subject to the Secretary of State's consent. However, I can say now that if Eurostar can come up with a commercial arrangement that would enable the stock to be put to use on the domestic network, pending the outcome of the Government's review, my right hon. Friend the Deputy Prime Minister would not stand in their way.
Decisions on the deployment of Eurostar drivers are, of course, a matter for the management of Eurostar (UK) Ltd. However, I have been assured by the company that its action in no way prejudges the outcome of the review. I understand from the company that, as a result of the delay in the introduction of a regional Eurostar service, it is incurring costs estimated to be about £250,000 per month--getting on for £3 million a year. To ameliorate those costs, the company has decided to offer a voluntary--I repeat, voluntary--severance scheme to the 32 regional Eurostar train drivers.
That decision was taken following consultation with the regional drivers themselves and with their unions. Eurostar tells me that 12 drivers have now accepted the offer of voluntary severance, at a cost to Eurostar (UK) Ltd. of £266,000. Those costs will not be met by the Government; they are rightly the responsibility of Eurostar.
As I have mentioned, the Government are keen to ensure that actions are not taken that might prejudice the outcome of our review. We have therefore asked Eurostar's management whether the loss of those drivers would affect the company's ability to run regional services, should that be decided. I am glad to say that we have received an unambiguous assurance from Eurostar (UK) Ltd. that, in the event that our review leads to a decision to start regional services, any requirement for additional drivers could be met and would not delay the introduction of those services. The professionals estimate that it would take only two to three months to recruit and train a driver to run a regional Eurostar train.
I know that many hon. Members remain concerned about the time that it is taking for the regional train sets to be cleared to operate on the west coast main line and east coast main line. I understand their concern. However, Eurostar regional rolling stock is technically complex, because it must be able to draw from four different traction current supply systems. Early testing revealed significant electro-magnetic induction problems when regional train sets interfered with the operation of track circuits. In lay person's language, that could affect all the signalling on the tracks, which would be extremely dangerous. Neither the Government nor Eurostar will act until we have clear confirmation that it is safe to use the
rolling stock. We hope that clearance can be given sooner rather than later, but uppermost in our mind is passenger safety.
Several hon. Members raised the question of regional Eurostar trains carrying domestic passengers, and I am happy to confirm that security is not a bar to Eurostar running regional services. The Government have always said that, provided procedures are in place that satisfy security requirements, there would be no problem with regional Eurostars carrying domestic passengers, and that remains the case. The Government's review will include consideration of the costs and benefits that might be incurred by Eurostar if domestic passengers are carried.
The decision to abandon European night services was made in 1997 by European Night Services Ltd.--not by the Government--following a commercial review of the services. ENS is a joint venture company comprising Eurostar (UK) Ltd and several European railways. The reason the Government became involved was because the lease agreed by ENS and Metro Cammel in 1992 was underpinned by a Government guarantee, given by the Conservative Government. ENS took the view that it would cost too much to complete the building of the stock; and, as there were no plans to use it, the company decided to leave the partially built stock with the manufacturer and allow the lease to terminate. The lease automatically terminated as none of the rolling stock had been delivered to ENS by the manufacturer.
The problem was that, at that point, LCR, which owns Eurostar (UK) Ltd., had just told the Government that it could not continue with the channel tunnel rail link project, and Eurostar did not have sufficient money to fund its portion of the lease termination costs. Payment would have led to the insolvency of Eurostar (UK) Ltd., which would have caused the collapse of the channel tunnel rail link project. The Government decided to allow the guarantee to be called and, on 1 June 1998, the Department of the Environment, Transport and the Regions paid out £109 million for the security left tous by the previous Administration. However, the Government are entitled to recover the payment as part of the restructuring deal agreed with LCR, the owner of Eurostar (UK) Ltd.
Although the rolling stock is now the responsibility of the manufacturer, Metro Cammel, part of the deal in allowing it to keep the trains involves a profit-sharing arrangement if they are sold on. ENS will get a 50 per cent. share of the profits if Metro Cammel--
Mr. David Chaytor (Bury, North):
I am grateful for the opportunity to introduce this debate. It is the first time in parliamentary history that the town that I have the privilege of representing has had a debate to itself in this place. I had hoped that my hon. Friend the Member for Bury, South (Mr. Lewis) would be here to share it, but urgent business has prompted his return to his constituency. However, my hon. Friend and I speak with one voice about all education matters in Bury.
The purpose of this debate is essentially twofold. First, I want to draw attention to the excellent performance of primary schools in Bury, whose reputation is growing as time passes. Secondly, I want to draw attention to the other noticeable feature of education in Bury: chronic funding inadequacies. That is not a recent phenomenon. If time allows--I know that this is a short debate--I shall give some feedback to my hon. Friend the Minister from teachers in Bury whose views I canvassed recently during a series of visits to primary schools.
Let me outline the nature of the local authority and the schools in Bury. The local education authority, which serves a population of a little more than 180,000, is one of the smallest in the country. Therefore, it has a proportionately small education budget that does not allow for the economies of scale common to larger authorities. It has a little over 60 primary schools and a coherent 11-to-16 system of secondary education, which feeds into two highly regarded colleges--a general tertiary college and a Catholic sixth form college. Although this debate focuses on primary schools, I also pay tribute to the performance of Bury's secondary schools, which are equally well regarded. Their performances to GCSE, in terms of passes at A to C, and particularly A to G, feature at the top of the annual league tables.
The local authority was inspected by Ofsted last year and its report was published in the first week of this year. I shall comment briefly about some of the remarks in it. The chief inspector of schools--whose comments I would not necessarily always quote with such gratitude--described Bury as an authority that
The message is that the local authority and its schools are regarded highly. I pay tribute to the teachers in Bury's schools, without whose skill and dedication those results would not have been achieved. I pay tribute also to
the governors. Being a school governor is a thankless task in many respects, but Bury is fortunate in having a large group of dedicated and experienced governors who support their schools particularly effectively. That has enabled the schools to develop and advance on a wide range of fronts, particularly in their literacy and numeracy strategies, the use of the national grid for learning investment and in many good examples of community involvement.
The facts relating to performance in Bury's primary schools are straightforward. At key stage 1 last year, in all aspects assessed--reading, writing, spelling and mathematics--Bury's primary schools were about 2 per cent. above the national average. By key stage 2, it is significant that Bury was rated as the second highest scoring metropolitan district and the eighth highest scoring local authority in the country. That is because the scores of pupils achieving level 4 and above were 8 per cent. higher than the national average.
In that context, I shall mention some individual schools from my constituency--if my hon. Friend the Member for Bury, South were present, I am sure that he would quote many good examples from his constituency. I must draw attention to the results achieved at Hollymount school, where 100 per cent. scores at level 4 and above in maths and science were achieved as well as scores of 93 per cent. in English, and at Greenmount, St. Mary's, Lowercroft and Our Lady of Lourdes school, which also achieved 100 per cent. in one subject.
Those schools serve catchment areas that are comfortable and, in many cases, very affluent. However, I also draw attention to schools such as Sunny Bank and Guardian Angels, which serve mixed areas, whose scores in English and maths were exceptionally good. I draw attention also to East Ward school and St. Thomas's school, which serve some of the most deprived wards in Greater Manchester. Both those schools obtained results of about 95 per cent. at level 4 and above in science. Some exceptional work is being done in schools that serve very deprived communities: the message is that there have been enormous improvements in various primary schools from key stage 1 to key stage 2.
Having cited the league tables and scores as evidence, I should add a note of caution. Teachers, head teachers and school governors in Bury are a little sceptical about the way in which league tables operate. They know that a small difference in the number of pupils taking the tests each year can result in a disproportionate difference in the end results. They know also that the league tables as currently published reflect mostly the nature of the school's catchment area rather than the value added by an individual school. I plead with the Government to move as quickly as possible--I know that the Minister is aware of this point--to introduce a value-added concept into the league table system. Nevertheless, the fact remains that Bury's primary schools have out-performed schools with similar catchment areas that serve similar local authorities and similar populations in other parts of the country and have shown particular progress between key stages 1 and 2.
On finance, Bury local authority has suffered historically from a low standard spending assessment. That is particularly evident in the impact on education. The aggregated schools budget per capita spend is £100 below the national average for primary schools and £150 below the national average for secondary schools.
That is despite the fact that, based on population, Bury comes in the middle of the social and economic indicators that are used to describe local authorities. The effect on a large primary school of 400 pupils is a deficit of about £40,000 a year and the effect on a small secondary school--a typical 11-to-16 school in Bury--is about £120,000 a year.
The SSA for primary education in Bury is £2,200 and £2,800 for secondary education. That contrasts markedly with the London SSA--I do not want to reopen the debate about SSA differentials between London and the rest of the country, but I must make this point--of about £2,800 for primary schools and about £3,600 for secondary schools. If we compare Bury and London--we all accept that London has special needs and difficulties--we find that a primary school in Bury is worse off to the tune of about £250,000 and a secondary school is worse off by about £640,000.
I know that Ministers at the Department of the Environment, Transport and the Regions are highly conscious of the inequities of the SSA system. I know also that a considerable amount of work was done on that last year and that a change to the children's social services criteria was introduced which benefited some of the poorly funded authorities such as Bury. However, I again draw attention to the fact that we must wait a further three years for the next review of SSAs. The contentious issues of the area cost adjustment and the additional educational needs criteria remain to be resolved. In those three years, Bury and other small local authorities will continue to be funded by a system that is widely regarded as being unjustified and methodologically unsound.
For many years, Bury spent about 11 per cent. above its SSA, which was a measure of the local authority's commitment to education. Unfortunately, that could no longer continue because of the severe budget cuts by the previous Government in 1996-97 which forced the local council to impose cuts of £12 million on the authority. That is not a large sum compared to the budgets of some local authorities, but for a very small authority such as Bury, it is huge. The effect on the education service was cuts of about £5.5 million, of which more than £3 million came directly out of school budgets.
The teachers in Bury's schools, the parents and the local authority welcome the new investment that my Government have introduced since 1997, particularly the total of about £4 million from the standards fund and about £1.8 million from the new deal for schools. That has enabled our primary schools to reduce almost all their infant class sizes--which, before 1997, were among the highest in the country--to 30 or below by the end of the forthcoming school year. That investment has also enabled primary and secondary schools in Bury to start a long-overdue programme of repair and new build.
I thank my hon. Friend the Minister for the interest that he has taken in education in Bury, following his recent visit to Holy Trinity primary school, and his particular interest in the local authority's attempts to get funding through the new deal for the East Ward primary school. I must now declare an interest because that is the school which I attended, but more importantly, it has operated on a split site for 40 years. It serves one of the most deprived areas in Greater Manchester, and the local authority's project for developing the school on one site is part of a
much wider community regeneration project, which can now proceed as a result of the funding under the new deal for schools.
The failure to make significant changes to the SSA system this year means that even the 5 per cent. annual increase projected for the next three years will barely restore the core level of funding to that which applied before the cuts made during the previous Government's last year in office. The difficulty is that even though the SSA will now increase year by year, part of the additional funding received by the local authority must be set aside for the matched funding that it hopes to receive from the standards fund. Even though Bury passports to the schools all the funding that it can, the amount of money that goes to the schools is inevitably reduced.
I do not say that Bury is unique, because I know that many other local authorities in metropolitan districts and shire counties have a similar struggle, but I am not sure that schools in Bury can wait for another three years before there is comprehensive reform of the SSA system. I know that the system is not my hon. Friend's responsibility and that DETR Ministers must grapple with it, but it seems to me that there is now a powerful argument for using the funding that the DfEE has at its disposal--the standards fund and the new deal--to compensate for the inadequacies of the core funding from DETR. There is a powerful argument also for establishing the concept of a minimal level of core funding, below which no local authority and no school should fall.
The 5.4 per cent. increase in Bury's SSA this year was higher than the average increase for metropolitan districts, but that average was lower than the average increase in SSAs for inner and outer London. We welcome this year's increase for Bury and the 5 per cent. increase next year, but for small local authorities, percentage increases serve simply to increase the cash differential. That is why small authorities need a cash injection to compensate for the inadequacies of the percentage increase.
Will my hon. Friend monitor closely the financial situation in Bury, particularly in primary schools, and make representations to his colleagues at DETR about the reform of SSAs? Will he find out whether there are ways in which the standards fund and the new deal for schools can be used to support local authorities, particularly small ones with the lowest levels of funding?
I have been fortunate enough to be able to visit about two thirds of primary schools in my constituency. The messages from teachers, governors and head teachers are clear.
First, the continually low funding makes it difficult to maintain the high standards that have been achieved in Bury. Secondly, the local authority has set demanding new targets to which the schools, after some arm-twisting, have agreed. I should point out that the literacy target for primary schools in Bury is now set at 90 per cent. of pupils by 2000, which is 10 per cent. above the national average target. The numeracy target is set at 80 per cent. of pupils by 2000, which is 5 per cent. above the national average target. It is disproportionately difficult for schools and local authorities that are already performing extremely well to achieve that extra increase. If only 20 or 30 per cent. of pupils are obtaining level 4 or above, it is relatively easy to increase that number by 5 or
10 per cent. The higher the starting point, the more difficult it is for schools to attain those final few percentage points. There is, therefore, a concern about the demanding new targets.
There is concern also about the proposals to reform teachers' pay and the way in which that will be linked to pupils' performance. If the budget is cash-limited, what are the implications for schools that already have a high level of pupil performance? Will they sweep up a disproportionately large share of the overall budget, or will there be discrimination between teachers who, by any national standards, are performing extremely well and wish to go through the threshold?
There is continuing concern about future funding, but there is massive support for the Government's actions through the standards fund, particularly on pupil improvement strategies and the national grid for learning, and the extra investment from the new deal. There is also a welcome for the Government's other initiatives, particularly the numeracy and literacy strategies, but there is concern about the pace of change, especially on the literacy strategy. Having gone through that process, however, most teachers feel well equipped to take on the introduction of the numeracy strategy from this September.
I repeat my point about league tables, about which schools are concerned. Schools at the top of the league tables in Bury express the most concern because they know that their position is due not only to dedicated, skilled teaching staff, but to their privileged catchment area.
I shall summarise my points about Bury's schools. The first related to high performance. The success that has been achieved, particularly in primary schools, between key stages 1 and 2, has been bought at the human cost of stressed, exhausted teachers. There is a question mark over how much more teachers in those schools can give. According to socio-economic data--whether we are comparing levels of unemployment, numbers of single parent households or other indications of poverty--Bury is always somewhere in the middle of the list, yet our funding is always in the lower quartile. The Government need to think of interim measures to help the local authorities with the lowest funding prior to completing the next review of SSAs.
I want to focus on the need to recognise high performance not only in Bury's schools but in those of other local authorities. How will the Government reward and recognise those schools and, in particular, what can be done to help to disseminate that good practice?
That brings me to my final point, which relates to the recent Ofsted reports on other local authorities. We have all read the reports on Hackney and Islington, and I imagine that we shall all read that on Liverpool. It seems odd that, when there is such expertise in certain parts of the state sector, we have not used it in the past to help those parts of state education that are not performing as well.
12.30 pm
"delivers . . . without rhetoric and fuss".
He said that the schools are doing very well and getting steadily better and that the authority
"makes highly effective use of money achieving high levels of service efficiency . . . plans well . . . supports literacy and numeracy, behaviour and attendance very well".
Following that report, the Secretary of State referred to Bury's schools in his speech to the north of England conference on 8 January, praising Bury's effective use of the performance data and baseline assessment to help identify the development needs of individual pupils. More recently, the Department for Education and Employment has particularly praised Bury's educational development plan, saying that it reveals an exemplary process of establishing targets for the LEA and for individual schools.
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