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Mr. Gardiner: I listened carefully to what the hon. Gentleman said about the 10p and 20p tax rates on savings. Is he not aware that one of the Budget measures is that the extension to savings of the 10p starting rate of income tax will now be effective from 6 April 1999? His point is no longer relevant, and the time differential was accounted for in my right hon. Friend the Chancellor's remarks.
Mr. Fallon: I am sure that that is helpful, but what was the point of the 20p rate on savings for those on 10p tax? I would not tax at all those on the very lowest incomes who pay the starting rate.
Like all Conservative Members, I welcome the increase for education and congratulate the Secretary of State and his ministerial team on securing it. As I recall, negotiations with the Treasury are never easy, and it is a good increase. Is it a one-off payment, though, or will next year's Budget--or even the pre-Budget report--allocate similar annual payments directly to schools? Has a precedent been set?
Unless I misheard him, the Secretary of State said that the one-off payments would be targeted. When he publishes the guidance--he said, perhaps by mistake, that it was already available, but I certainly have not seen it--will he make it clear what the payments can be used for? Are schools free, for example, to use them for teachers' pay? Will they be able to use them to fund the new performance-related pay bonuses, or are they restricted to the non-salary element of their delegated budgets?
Mr. Richard Allan (Sheffield, Hallam):
The hon. Gentleman raises an important point. In Education questions earlier, the Secretary of State specifically related the amount of money to the number of teachers employed, and clearly schools cannot go around employing teachers unless they have some certainty for the future, so I hope that the Minister will clarify the matter.
Mr. Fallon:
That is a most helpful intervention. I apologise to the House for not having been present at Education questions. I was speaking to a school group, which I suppose is a better excuse than some. As that intervention demonstrated, if the payments are for the salary side, they will bind schools into commitments that they may not be able to meet in subsequent years.
Mr. Gardiner:
Will the hon. Gentleman give way?
Mr. Fallon:
I am sure that this intervention will be as helpful as the hon. Gentleman's previous one, so I will.
Mr. Gardiner:
Indeed, I intend to be helpful. The Secretary of State said specifically that the moneys were
Mr. Fallon:
In trying to be helpful, the hon. Gentleman is digging the Secretary of State into a bigger hole. If the head teacher can use the money however he chooses and he decides to use it to top up teachers' pay or to recruit an extra part-time teacher, what certainty has he that the money will be repeated in subsequent years? There may be no mystery here, and perhaps the Minister will make it clear that the money is a one-off and head teachers had better look out and not make commitments that they cannot meet in subsequent years, or perhaps he will say that it was always intended that at least that amount and no less should be repeated in subsequent years, but I hope that he will agree that the matter can be easily cleared up at the end of this debate.
As I understand it, the extra payments will be given indiscriminately to every school, irrespective of performance, on the basis of pupil numbers. I have no objection to that, but it is not what the Government said last year, when they produced public service agreements saying--it is all there on page 11--that the money allocated to the Department for Education and Employment would be specifically committed in return for meeting certain performance targets.
That was the whole point of public service agreements. That is the agreement that the Chief Secretary and the Secretary of State signed in blood, but on Tuesday we heard that schools would get their cheques irrespective of whether they had achieved their literacy or GCSE targets. Have the agreements been abandoned? Perhaps the literacy targets have been abandoned. That might get the Secretary of State off the hook, as I think that he promised to resign if they were not met.
The hon. Member for Harrogate and Knaresborough asked what were the Government's intentions towards local education authorities. As it happens, I do not agree with him. He said that one must seriously debate whether one wants Ministers in charge of the system, making all the payments centrally, or whether councillors should be in charge, ensuring democratic accountability. I can only say to him--he has left now, so I say it to the hon. Member for Sheffield, Hallam (Mr. Allan), who may be his parliamentary private secretary, for all I know--that that is not the stark choice. I do not want either in charge of the system.
As I said repeatedly when I was a Minister, and as I have written endlessly since, I do not think that either Ministers or councillors should be in charge of the education system. In the end, parents should be in charge. That is the whole purpose of our free schools policy. Parents should be in the driving seat and able to choose freely the schools that suit their children's particular skills and abilities.
The hon. Member for Harrogate and Knaresborough also tempted the Minister into the field of higher education. He was right to ask for clarification, and I think that he got some, on the fact that the Government do not intend to have top-up fees. He went on to try to draw a distinction between top-up fees and differential fees. I do not think that there is a distinction. I see no objection in
principle to the very best universities being able to devise such arrangements, provided that they are supported in other ways, through alumni and business contributions.
I would start at the other end. The cruellest deception, having expanded higher education, is to pretend that the university at the very bottom is delivering the same quality of research, scholarship and higher education as those at the very top. My only regret about our reforms to end the binary line and bring polytechnics fully into higher education status is that we did not go further and introduce more of a market system by encouraging proper publication of the outcomes so that students are not tempted by anecdote, history or the personality of a teacher or head of department to sign up for courses that lead to a worse outcome, with less chance of getting a job at the end.
It can be said in the Chancellor's favour that at least he did not try to triple count the new money he gave the NHS, as he has done before. We did not hear as much about the £21 billion as we did when it was announced two years ago. Indeed, the £21 billion was not only triple counted, but we were told that it was enough to give the NHS all the resources it needed. The famous £21 billion was announced in 1998 and started to take effect in April 1999. Before the first year of all that extra, triple-counted money has ended, the Government have suddenly said that it was not enough. Now an extra £2 billion has to be found and health service spending must jump from 3 per cent. to 6.1 per cent. a year. Suddenly, the NHS needs wholesale reform. What have the Government been doing for the past three full years?
In return for the extra taxes, the public deserve to see better quality public spending. We heard nothing about a reduction in the welfare bill, which is still rising. Less money should be wasted on dealing with asylum seekers, and that problem should be tackled at source. Less money should be wasted on regional bureaucracy and a tougher approach taken to public spending across the board.
I am a little wary of the various small tax breaks that the Chancellor introduced for business. Of course industry welcomes capital allowances and those who are offered free computers or special deals on the leases welcome that. However, too much of the help announced on Tuesday is spread too thinly. Behind that assistance lies the dangerous assumption that e-commerce is now the only form of enterprise on the table. E-commerce is important, but in many respects it is a means to enterprise, not the only enterprise. The Government are trying to be fashionable in channelling extra money to a sector that appears to have much activity and investment already. Do the dot.com companies need that extra public subsidy? They seem to get a lot of attention without it.
The business postbag in my constituency has a different agenda. Businesses complain about the level of business rates, but I heard nothing on Tuesday about the level of the uniform business rate, which is a huge and--with the revaluation--growing burden on business. Above all, I heard nothing on Tuesday about the Government's so-called campaign to cut red tape. We had a deregulation task force. The Government call it the better regulation task force. That is not just semantics, because we have seen no deregulation. We used to have 30 or 40 deregulation orders a year, but the Government have hardly any.
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