Select Committee on Education and Skills Minutes of Evidence

Examination of Witnesses (Questions 60 - 79)



  60. We have actually got that saving that was promised, on opening this?
  (Dr Thompson) It is on the budget, yes. I think, from memory, it is £52 million less than the budgets would have been, had we gone on with the old system.

Paul Holmes

  61. The £50 million saving, even though apparently you gave them £25 million extra?
  (Dr Thompson) That is absolutely right, yes.

  62. So you are still saying it is over £50 million, despite the increase?
  (Dr Thompson) Yes.
  (Mr Normington) We said we would do that.

Valerie Davey

  63. I am a school governor, and one came very concerned to my surgery only last Friday. You are the people who hold the purse-strings, and you have just explained how you have faced real problems in adjusting your huge budget. Many of these school governors are volunteers, with huge financial problems, in their perspective, and are really angry at what they are reading and seeing. Do you not understand how difficult it makes life for the voluntary school governor, doing the best for their school, who learns about £1.3 billion; they are desperate for just enough money for another teacher?
  (Mr Normington) I do understand that, because I have experienced it directly several times, and you can tell from the discussion that we have just had, it is very, very difficult to explain why it has happened to a school governor in that position. And I do understand that. I do try to explain it, and sometimes it works, but there is a long gap between the explanation we have given and the experience of a school governor. I hang on to the point that is true, which is that the money that we have, that Parliament has voted for schools, is going to schools and is being spent by schools; but underspends are not principally on schools budgets.

  64. It has no effect at all, to discuss it with a governor who is a governor of a school in a very difficult area, for whom that money would make a huge difference to the life of the children at that school. And I think, quite honestly, you ought to send these people, these middle managers, whoever they are, and the budget that you want to improve, into a governing body meeting, actually to sit with them and understand the pain of the decisions which they have to take, without all the expertise that you have got in your Department?
  (Mr Normington) I do understand that. I have been to school governor meetings, so that I have experienced that myself, and, of course, a lot of our staff are school governors as well. So we do know that, we do get that back. All we can do is go on trying to explain it. But £1.3 billion is a lot of money. We did reallocate some of it at Budget time, and most of the reallocation was to schools; it was a reallocation of money, that was not originally voted for schools, to schools. So I can show them that we are now trying to make sure that if there are genuine underspends they are reallocated in that way, and they should feel the benefits of that, in terms of more support. And two areas of money were more money for capital and more money to support behaviour, truancy and to tackle street crime; those were two particular priorities.

  65. Can I just say, I think this illustrates, at a very specific level, the whole need of a Department, and not just Ministers, to be more in touch with and more accountable to those people who work in the school system; and I take the schools, and we could take FE and we could take higher education. The dialogue between the Department and those people who, in effect, are delivering for you on the ground, has got to be to use a phrase that I do not think is particularly good, `transparent', but there has to be a human dialogue going on. You have been very open with us, in saying that you have been to a school governors meeting; unfortunately, of course, there are thousands of them going round and for every one that you attend or are at. So somehow and I just hope, can you give us any way in which the Department, in future years, will begin to address the need for a better dialogue, a better relationship with those people delivering, and that is not just the teachers, it is the governors, it is the school caretakers, it is the college principals, all those people, who are actually delivering the service?
  (Mr Normington) I am personally absolutely committed to trying to take us further down that road, of talking and explaining and listening to the people who are on the receiving end of what we do, and actually are the ones on whom we depend; my predecessor did a lot in that direction, and I have been trying to build on that. And the only answer to it is that there are 4,000 people in the Department for Education and Skills, and there are millions and millions in the education system. It is absolutely true that, when you sit down with a group of school governors and have a sensible discussion with them, I learn a lot, and so do they, and actually the relationship is immeasurably improved; if we can repeat that ten thousand times we will really make a change. And we have to have the ambition that we can actually make an impact, by at least getting some school governors together, by getting headteachers together, by getting groups of teachers together; we have done a lot in that area, but it is still not recognised, you still meet lots of people who have never met anybody from the Department.

  Chairman: I want to move on to closer scrutiny of the Departmental Report and Estimates. John, would you like to open, on that?

Mr Baron

  66. Just two very quick questions, Mr Normington. In previous Departmental Reports, it is a small point, but individual civil servants' names and telephone numbers have been included; and it appears that they are not in the latest, the points of contact for the public. In this age of greater accountability and transparency, can you explain why that is the case?
  (Mr Normington) I cannot, actually; you can, can you, Ruth?
  (Dr Thompson) Yes. The simple reason is the strictures that were placed upon us, including by ourselves, to keep the thing brief; and we have no possible objection to the names and contact details of Departmental staff being available.

  67. But a few lines, giving telephone numbers, it is not going to add much to the weight of a Report, is it?
  (Mr Normington) We will make sure that they are in next year. Nobody reads the Departmental Report though.

  68. We do, Mr Normington.
  (Mr Normington) You do, sorry. I do, you do, but the public who want to contact us probably do not.

  69. But it will be put right next year?
  (Mr Normington) It will be put right, I promise.

  70. Fine. Very quickly, resource accounting. There are those who believe that the advent of resource accounting is going to give you a lot more, how can I put it, that it is going to improve the quality of information that you are going to be able to supply the Government with, with regard to helping them to run the Department generally and achieve policy objectives. What changes are you making with regard to the way you operate, in order to take advantage of this new resource accounting ?
  (Dr Thompson) Let me start with a slightly cautionary note. Resource accounting, in respect of the Department for Education and Skills, does not make a huge impact on the way in which our expenditure appears, or in the way in which the details of our management information and financial information appear to us. With the sole exception of the student loans area, most of our budgets look rather as they did under the old cash regime; now that is neither here nor there, in one sense. We are going to be making use of the information that we are generating for resource accounts purposes, to report to our Board on a monthly basis about the financial performance of the Department, and we will be putting that next to information about the performance of the Department against its various targets, so that we can draw the appropriate relationships. And this is part of some work that I have been undertaking in the last few months, with a view to having a new system, starting up in April 2003; at the moment, we are in a transitional stage of using the resource accounts information on a monthly basis, which you get at the Executive Board, to report on where we are, and it relates, indeed, to the questions that you were raising earlier on, about underspends. So we are working to improve the use to which we put our financial management information; and resource accounting has made a difference, but not a big difference, in that regard.

  71. To what extent do you think it will make a difference with regard to underspend?
  (Dr Thompson) Resource accounting; it will not make a huge difference in respect of underspends. The principle of resource accounting, as you will understand, means that the expenditure scores when the consumption takes place, not when the cheque leaves the building. But, in the sense that we are already working very much with current expenditure, in most of our arrangements, because most of our arrangements are either direct, current payments to providers of services, or grant payments to major NDPBs, it is not going to make a great deal of difference to the way the profiles work.

  72. But it will improve the quality of the information?
  (Dr Thompson) It will.


  73. This was all imposed by the Treasury, was it; it was inspired?
  (Dr Thompson) It was inspired by the Treasury, yes, it was inspired by the Treasury back in the early nineties.

  74. With regard to resource accounting , do you welcome it, it is a big improvement?
  (Dr Thompson) It is a modest improvement, as I think I have tried to explain; it has not made a huge difference to the way in which we look at the consumption of resources in the Department for Education and Skills. Across Government, in other Departments, where there are big internal Departmental capital programmes, it makes a massive difference to the way they look at their expenditure, and it will improve their systems, it has already caused them to improve their systems and brought very good benefits for them.

  75. This Committee is always interested in what is a good idea somewhere else; it comes down as red tape and bureaucracy when it actually hits the people that implement. So I wondered if it was a bit of a taste of your own medicine, in the sense of...
  (Dr Thompson) I do not think it is felt like that in the Department.

  Chairman: Right. To carry on in this vein, David Chaytor.

Mr Chaytor

  76. Can I come back to the question of the Standard Spending Assessment, and earlier you told us the variation between the different numbers for local authorities, between about 3 per cent and 10 per cent. What do you think is a reasonable level of variation?
  (Mr Normington) I do not know, honestly, I think that is too wide.

  77. Less than 7 percentage points?
  (Mr Normington) I think it would be. Actually, as I explained, the Government has introduced damping to reduce that variation; so I think the floor is at 4 per cent, at the moment, to make sure that everybody has a 4 per cent uplift. I think that is right. So that is a signal, in a sense. It depends why the variation has occurred, and whether there is more confidence in the formula that leads to that variation. I think that is the right way to approach it. As we head for this very important next few months, when we try to redraw the formula for education, it is at that point that we will judge what factors it is right to take into account which lead to that variation; and I mentioned too, it is clearly right that there are some deprivation factors and it is clearly right that there are some cost factors related to living costs. How you measure those and how you ensure that they are real is the big issue, as it has been for quite a long time in local authority finance, it is the great issue.

  78. The consultation paper will appear in the next few weeks?
  (Mr Normington) That is what I am expecting, yes.

  79. Will it be before July 24, or soon after July 24?
  (Mr Normington) I do not know, actually. I think my briefing told me it was likely to be in the middle of July, and I do not know more than that, the middle of July, but not a precise date.

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