House of Commons Hansard Debates for 30 Jun 1999 (pt 14)

Ms Morris: I an glad that my attack at least brought the hon. Gentleman to acknowledge the improved funding for most of the schools in his constituency and throughout the county since the Labour party came to government. He failed to say that the standard spending assessment in Hampshire has increased by almost £50 million during the first two years of the Labour Government, compared with a 5 per cent. increase over two years under the old county boundaries formula. That means that for children in the hon. Gentleman's constituency there has been a real increase of 6 per cent. for primary schools and 4 per cent. for secondary schools. That is to be welcomed.

When we took power, we were faced with a funding system that discriminated against children. That was not because some children were less important or needed less finance. They were discriminated against because their parents had chosen to send them to schools that did not have a GM label. The hon. Gentleman acknowledged--we must all do so--that, under the Conservative Government, there was a funding differential that was based merely on category of school. That Government had the necessary power and authority, and they could have found the resources to level up. They could have ensured that every school received the funding level that applied to GM schools. However, there was the ridiculous situation of budgets for GM schools increasing year by year in terms of revenue and capital, while real budgets for children in the vast majority of schools fell. I wonder how many angry words were spoken in the House by Conservative Members before the election on behalf of

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the vast number of children who were educated under the previous Government in schools whose funding decreased year by year.

Dr. Julian Lewis: Will the Minister give way?

Ms Morris: Yes, but I give warning that, because of the extra time taken by the hon. Member for New Forest, West, this will be the last intervention I shall take.

Dr. Lewis: I thank the Minister for giving way so that I can get in a completed comment. Is not the problem that the Government have said that they will level up and extend the funding advantages from grant-maintained schools to the rest, even though the effect of those changes is that over half the central funding, which was being distributed by the GM schools, is now being retained--by the county council in our case? That means that the funding environment for the GM schools is less favourable and, thus, the Government's promise has not been fulfilled.

Ms Morris: That is the crux of the argument made by the hon. Member for New Forest, West. I shall deal with that now.

The previous Conservative Government acknowledged that there was an element of double funding for grant-maintained schools--that point was first raised by the Select Committee on Education, which had a Tory Chairman--and, well before the election, they introduced a degree of parity to the funding mechanisms. To some extent, we have furthered that. The argument revolves around the addition that was made for central functions held back by the local education authority.

On the element of double funding, the hon. Gentleman is right to say that that central annual maintenance grant gave schools extra money--I accept the figure of 8.7 per cent for schools in Hampshire--because they would no longer need the services of the local authority on which that money was spent. Hon. Members know that those schools were not charged for that money, but received the same service free from the Funding Agency for Schools. That is the element of double funding--it was delegated to those schools as central AMG, but not charged to them by the FAS. Central Government picked up the tab. We can debate that arrangement, but no hon. Member can justify it as fair and reasonable or as a funding system with which we should continue.

The previous Government remedied the error in the funding formula, and we have continued with that. I take the view that local education authorities need to do certain things, some of which concern managing the funding formula. When local authorities did not undertake such management for GM schools, the FAS did it. Someone has to manage the admissions system and the surplus places and make sure that there are sufficient places for children in LEA areas. That important measure, to which the hon. Gentleman referred, does not come free; it has to be paid for.

Schools do not want to have to manage those services by themselves--indeed, they cannot do so--so an element of what was central AMG has to be kept back by local

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authorities, and that has to be part of the education budget. Much of the dispute is about that remedying of the double funding element of central AMG.

Like the hon. Gentleman, I congratulate Hampshire education authority on the way in which it has delegated funding. Compared with other local authorities, it is to be praised. Although we always want more and are never complacent, I shall not criticise it on this occasion. It has delegated 85.2 per cent. of its funds to schools compared with 82.4 per cent. nationally and 83 per cent. for all shire counties. That increased delegation and the fact that Hampshire has passed the increase that the Government have secured on to the education budget means that every school in his constituency will benefit from increased funding, as he acknowledged.

I have two more points to make. On transitional funding, I admit that it is not easy to move from a funding system that was not fair and just to one that treats children on the basis that they are of equal value and have equal need for funding. Managing that transitional arrangement is not easy. We have acknowledged the contribution made by GM schools to the debate about schools' ability to run themselves. Much of the fair funding formula and much of the work that we have done take the best from the GM system as well as the best from the system of financing maintained schools.

Last year, we offered transitional protection at cash levels based on pupil numbers. Although the hon. Gentleman did not do so at Question Time, I am delighted that he acknowledged today that some of the difficulties of Arnewood school--and of another school, which may be in the constituency of one of his hon. Friends--arise from the difference between the number of pupils who attend the school and the number who were forecast to attend. Against the predictions of the LEA, the FAS decided to fund Arnewood school at such a level last year.

Whatever funding system was used this year, and even if the FAS had been managing the funding arrangement, there would have been a clawback from Arnewood school because pupil numbers were inaccurate last year. Indeed, it has come off better because transitional protection gave it protection based on its funding last year. The money that would have been clawed back in other circumstances was not clawed back. A bit of me says that the hon. Gentleman protests too much on behalf of Arnewood school, although I acknowledge the difficulty that transitional funding can offer.

We have to remember that every school that receives transitional funding is receiving more money than a comparable school in the local education authority area. I say to Conservative Members that that is a criticism not of the funding that we have put into schools and the funding mechanisms that we have employed, but of the funding that most schools had to put up with in the years of Tory government. The key point is that such schools are receiving more than schools in similar circumstances. As we enter a period of increasing education budgets, the funding of all schools will increase to match the level that favourable funding gave to GM schools before the general election and beyond it.