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Independent Schools
3. Mr. Christopher Chope (Christchurch): What the annual net cost or benefit to the Exchequer is of the charitable status of independent schools. [125826]
The Chief Secretary to the Treasury (Mr. Andrew Smith): There are no official statistics, but the Government are working in partnership with the sector, as the hon. Gentleman knows.
Mr. Chope: I thank the Minister for that reply. Can he confirm that independent schools provide excellent value for money to the Exchequer and the taxpayer? They save the Exchequer having to fund some 600,000 school places out of taxation. For every pound received in charitable relief, the sum of £2 is spent on community benefit. Some £180 million is received in foreign earnings each year.
Why are the Government obsessed with making remarks detrimental to the success of independent schools
and universities? Why do they not concentrate instead of trying to improve standards in state schools? Why does the Minister think that the number of pupils educated in independent schools has risen during the lifetime of this Government, rather than declined?
Mr. Smith: The Government do recognise the distinctive strengths and contributions of the sector, which is why we are working in partnership with it. We believe that there are clear educational and social benefits from that collaboration. That is why we have set up our partnerships fund scheme, which this year will benefit 6,000 pupils from both state and independent schools on collaborative projects--part of a £400,000 fund that is available this year. So I dispute the hon. Gentleman's assertion, and repeat that we are committed to working in partnership, drawing on the strengths of both sectors.
Mr. David Taylor (North-West Leicestershire): In the lottery of British life, far too many of the big prizes go to the 7 per cent. of people who are educated privately. Does my right hon. Friend agree that the social costs associated with this far outweigh the small sums referred to by the hon. Member for Christchurch (Mr. Chope)? Does my right hon. Friend agree with the former deputy leader of the party, and myself, in that we can never be a mature and progressive country while the levers of power of our nation are so often exercised by people who have been educated in public schools?
Mr. Smith: The important thing is that this Government and our party stand for opportunity for all, regardless of their background or, for that matter, the school that they go to. However, it cannot be acceptable when, for example, 67 per cent. of those achieving the top grades at A-level come from state schools, but achieve only 52 per cent. of the places at the top universities. That is what our campaign for opportunity for all is about: ensuring that everybody, regardless of background or education, has the opportunity to make the most of his or her potential.
Mr. Howard Flight (Arundel and South Downs): As the Minister will be aware, all educational institutions, as well as charities, suffer considerable tax costs as a result of irrecoverable VAT as well as the £500 million lost on ACT recovery. What plans have the Government for reforming the arbitrary and unjust VAT imposition on charities as well as for compensating for the ACT cost? Those are the two key issues about which charities, and in particular educational charities, are concerned.
Mr. Smith: I note that during the 18 years they had the chance to do something about that, the Conservatives did nothing at all. When we talk about the independent sector we are not just talking about conventional public schools; we are talking about the state schools, the choir schools and the ballet schools, as well as those educating children with special needs and those serving ethnic and religious groups. Those with charitable status are, of course, benefiting from all the measures that the present Government have taken to promote charitable giving, and that my right hon. Friend the Chancellor has just set out.
Employment (North-East)
5. Ms Dari Taylor (Stockton, South): What assessment he has made of the impact of his economic policies on levels of employment and unemployment in the north-east. [125828]
The Chancellor of the Exchequer (Mr. Gordon Brown): In the north-east, as in the rest of the United Kingdom, we have created a sound and credible platform of economic stability; we have also created the new deal and the working families tax credit, which will help us to attain our objective of high and stable levels of growth and employment. Since the election, employment in the north-east has risen by 20,000 and unemployment has fallen by 19,000. There are more than a million people in work in the north-east, the highest-ever figure.
Ms Taylor: I thank my right hon. Friend for that reply. Has any consideration been given to extending the new deal as a training and employment programme? In my constituency, overall unemployment has dropped by 13 per cent.; youth unemployment by 54 per cent.; and long-term unemployment by 57 per cent. It has been without doubt a success. Will my right hon. Friend refute the statement by the shadow Chancellor that the new deal has been an expensive failure? It has been a cost-effective success in my constituency.
Mr. Brown: This is the difference between the two parties: we will extend the new deal to give young people, the long-term unemployed, single parents and others greater opportunities to get jobs. In that way, we are creating nearly a million jobs. The Conservative party would abolish the new deal and the working families tax credit. While it talks about full employment, it is removing the means by which we can achieve it.
It is very interesting that throughout the 1980s and 1990s, the shadow Chancellor never mentioned the words "full employment" as a commitment of the Conservative party. When he was at the Treasury and unemployment was rising, he said nothing about full employment. When he was Secretary of State for Employment, he said nothing about full employment. Even when the election was over and he was criticising the Conservative party for being harsh and uncaring, he said nothing about full employment. Now, as the next Conservative party leadership election comes nearer, he tells us that he supports full employment. If the Conservative party supports full employment, why is it trying to abolish the new deal, which is helping to create full employment?
Miss Anne McIntosh (Vale of York): Is not the Chancellor of the Exchequer ashamed that under his stewardship at the Treasury there have been closures, not least at Samsung in the constituency of his right hon. Friend the Prime Minister and a plant within the Vale of York, as well as Siemens in the north-east? When will he take measures to tackle the high level of the pound, the low level of the euro and record unemployment in manufacturing and farming?
Mr. Brown: The record closures happened under Conservative Governments: 1 million manufacturing jobs were lost in the early 1980s and another 1 million in the early 1990s. The Government are creating jobs--nearly
1 million of them. If the hon. Lady wants to help us to create jobs, she should tell the shadow Chancellor to support the new deal instead of trying to abandon it.
Mr. Jim Cousins (Newcastle upon Tyne, Central): May I draw to the Chancellor's attention a proposal by Sage, an information technology company on Tyneside, to create a new cluster of enterprises centred in the employment area just north of Newcastle, which would bring the benefits of employment to the whole of Tyne and Wear? May I also draw to his attention the proposals of the regional assembly of councils and the regional development agency, which will be published today and tomorrow? They are offering significant proposals to bring about in the north-east of England the self- sustaining growth that we have not had for many years. Will he respond to those proposals with more support and more investment through the comprehensive spending review?
Mr. Brown: I am grateful to my hon. Friend for raising those points. I have visited Sage in Newcastle, and I can say that we shall announce more help in future for the regional development agencies, including One North-East, to allow them to adopt the kind of strategy that he mentioned. In the north-east, 40,000 more jobs have been created during the past year alone. I have examined the unemployment figures for each constituency: since the general election, there has been only one Conservative Member from the north-east, and youth unemployment in his constituency has fallen by 60 per cent. and long-term unemployment by 50 per cent. Jobs are up in the north-east, vacancies are up in the north-east, investment is up in the north-east--all of which the Conservatives would find out if ever they were up in the north-east.
Mr. David Heathcoat-Amory (Wells): Is the Chancellor aware that businesses in the north-east have expressed serious alarm about his decision to impose a new energy tax--the so-called climate change levy--from next April? Businesses have told the Chancellor and the Treasury that that new tax will threaten future investment and jobs. Why does the Chancellor ignore the voice of industry, which produces investment and jobs? Does he agree that the new energy tax is completely unnecessary as the environmental changes to meet our international commitment could be far more easily achieved by other means?
Why is the Chancellor imposing a new stealth tax that all businesses, of whatever size, will have to pay, but which will bear particularly heavily on the manufacturing industries of the north-east, which face international competition? Is the Chancellor aware that the Government's talk of partnership with industry is mere empty rhetoric if he is simultaneously imposing new burdens and taxes on the wealth-producing sectors of the economy?
Mr. Brown: The longer the right hon. Gentleman speaks, the less convincing he becomes. Let me remind him that the climate change levy originated in a proposal from a committee chaired by Lord Marshall, the president of the Confederation of British Industry. The proposal is revenue neutral for businesses and for manufacturing industry. There will be no revenue gain to the Treasury.
May I also remind the right hon. Gentleman that we have done something that the Conservative party never did, by cutting corporation tax to the lowest level in the industrialised countries? We have also cut small business tax to the same level. Given that unemployment is at 1.5 per cent. in the right hon. Gentleman's constituency--and in that of the shadow Chancellor--I should have thought that he would congratulate the Government on creating jobs. In my constituency, the Rosyth unemployed workers centre existed for 15 years under a Conservative Government, but will soon hold an emergency meeting to decide whether to disband because we have created jobs. If the Conservatives want to help us to create employment, they should start backing the new deal instead of attacking it.
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