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11 Apr 2003 : Column 520—continued
Mr. Green: The second half of the hon. Gentleman's statement is complete nonsense. On the first half, I advise him to talk to his colleagues, and not just the hon. Member for Croydon, Central. If he had been here for education questions yesterday, he would have heard the hon. Member for Hendon (Mr. Dismore), a Government Back Bencher, attacking the Government for the cuts they have made. Whether Labour Members believe it or not, the Chancellor's tax on jobs is a tax on teachers. It will cost schools £170 million this year, not
to mention the money that it will take from colleges, universities, non-teaching staff and local education authorities.What the Government give with one hand, they more than take away with the other, because, on top of the national insurance increase, there has been an increase in employers' contributions to the teachers' pension fund and, of course, a monstrously unfair local government settlement.
The Secretary of State's former employer, Neil Kinnock, had his finest hour when he talked about his disgust at a Labour council sending taxis around Liverpool to make council workers redundant. What an irony that we now have a Labour Government sending redundancy notices around the whole country to teachers and teaching assistants. Things can only get worse. The local government settlement will bite over three years, getting tougher by the year, which threatens the so-called historic work load agreement of 15 January. Already, the National Union of Teachers has refused to sign it, but now, because of the funding crisis precipitated by this Government and this Chancellor, the National Association of Head Teachers is threatening to pull out as well. Last week its general secretary, David Hart, wrote to the Secretary of State saying
- "It would not be an exaggeration to say that there is an unmanageable crisis in funding in a number of areas. Members are talking about this as the worst position they have faced for years."
The Government's incompetence and double-dealing over the financing of schools will cause damage in the long as well as the short term. It is not just that they have failed to make the money actually arrive in schools; they have failed to bring about the reforms that they promised—a pattern of failure that is repeated throughout the education system. The work load agreement is crumbling and schools face the worst funding crisis for years. One child in four leaves primary school unable to read, write or count properly, and more than 30,000 leave school with no qualifications at all.
Ten thousand children have been completely lost by the system. The gap between the best and the worst, the richest and the poorest, is growing. The number of teacher vacancies has doubled. Hundreds of thousands of children are trapped in failing schools. Nearly two thirds of companies report that their staff lack basic skills. That adds up to a picture of failure in which millions of young people are robbed of their opportunities and their chance to get on in life.
Mr. Kelvin Hopkins (Luton, North): Will the hon. Gentleman give way?
Mr. Green: I am sorry, but I am trying to stick to the deal that I made with the Secretary of State in the interests of Members on both sides of the House.
There is an alternative to the way in which this Government run our education system—an alternative that offers better education for all, built on the twin pillars of trust in teachers and empowering parents. We need a complete reversal of direction. The modern
centralisation of education was initiated in 1976 by Lord Callaghan's Ruskin speech, which set in train the reforms of the 1980s and 1990s and, indeed, much of what the present Government did during their first term. Many of those reforms were necessary, given the state of English schools in the 1970s. A national curriculum, the Office for Standards in Education, regular testing and the publication of performance results all helped to raise standards by shining a light into the walled garden that education had become, and letting parents know what was going on within the school walls.That process of centralisation, however, has gone much too far. It is doing more harm than good. I do not blame the current Secretary of State—I suspect that his instinct is to give schools more freedom—but his hands are tied by those in the Treasury, notably the Chancellor himself, who cannot allow anyone else to make an important decision. One of the central failures of new Labour is over-centralisation. If we are to allow our schools to meet the challenges that they should be meeting, we must spend the coming decade setting them free and giving more choice to all involved in education, from teachers to parents.
The current system is broken, and a sea change is necessary. It is not possible to have excellent schools without well-motivated heads and teachers. If we do not give the professionals freedom to decide how best to get their pupils over the hurdles that parents and society demand that they jump, we will create a resentful profession that approaches each task wearily, in the spirit of "What does the Minister want this week?" rather than that of "What can I do for these children?". Too many members of the teaching profession are perilously close to that approach.
If parents are given some choice and some power, they will demand higher standards, and those demands will be as strong in the inner cities as they are in the leafy suburbs. That belief underpins the policies that we have announced. Our state scholarship scheme, starting in the inner cities, would give parents their first opportunity to break the cycle of underachievement and choose good schools for their children.
We will allow good schools to expand, to give more children the benefit of a high-quality education. We will not abandon schools that are in difficulty. It would be wrong to turn our backs on them, but when it is not possible to improve them we will encourage parents and organisations to set up publicly funded schools, as is done in many other countries. No child will be condemned to a poor education.
We will trust professionals to deliver high quality. We will slim down the curriculum, giving heads and teachers more power to judge what is in the best interests of their pupils. We will cut bureaucracy, and the number of funding streams. We will scrap the independent appeals panels that are undermining the ability of heads to set standards of behaviour in their schools. Legally backed home-school behaviour contracts for all schools that want them will receive our fullest support.
We will go much further than the half-hearted attempts at decentralisation to be found in existing legislation. If a school wants to become autonomous and meets transparent criteria for standards of performance, discipline and governance, it will be able to make that choice. Our guiding principle will be that
schools run schools best. We will create a system in which once again the expertise of professionals, not the agenda of central Government, is the driving force behind improvement. Our system will be built on fairness and guided by accountability.The Government's policy of investment and reform has been wrecked on the rocks of centralisation. The Government have increased spending, yet schools face funding cuts and students will pay higher fees to universities that will be under ever more Government control. More money is coming from the taxpayer, yet everyone in education feels worse off.
The test of any Budget is whether it leaves the country better or worse off. This Budget has left our education system weaker than it was, with demoralised teachers, angry parents and disillusioned children. For that reason, alone history will judge it harshly, and the House should vote against it.
Madam Deputy Speaker: Order. I remind hon. Members that Mr. Speaker has imposed a 12-minute limit on all Back-Bench speeches.
10.26 am
Mr. Kelvin Hopkins (Luton, North): I had hoped to make this speech yesterday, so it does not particularly concern the skills agenda. I hope that that is acceptable.
I want to make three main points in my brief speech. First, I want to consider the possible course of the economy, both national and international, in the near future. Economic forecasting is notoriously difficult, and despite Britain's relatively good performance and my right hon. Friend the Chancellor's cautious optimism, there is still a possibility that the worldwide economic downturn will be severe.
My right hon. Friend's forecasts may well be accurate, and I hope they turn out to be so. This morning's IMF news was certainly quite good. He will know, however, that there are many examples of hopelessly wrong forecasts from the recent past. In 1979, blinkered monetarist zealots were forecasting that the new economic strategy of Mrs. Thatcher and Geoffrey Howe would lead to faster growth and falling unemployment. In fact, we saw unemployment rise by 2 million in 18 months and one fifth of British manufacturing disappear before Nigel Lawson was installed as Chancellor to reflate the economy in the 1980s. The exchange rate mechanism was another calamitous story.
In his Budget speech, the Chancellor was right to contrast Britain's relatively successful performance in recent years with the performances of other developed countries, especially those within the eurozone. Many of the world's major economies now face serious economic difficulties, and there is a real possibility that Britain, despite its good performance, will be dragged down by the rest of the world. There is a serious deficiency of demand in Asia, the United States and, in particular, the European Union, the destination of 60 per cent. of British exports.
If Britain's economy were seriously affected by a world economic downturn, I would have no qualms about our Government's increasing borrowing
substantially, both to fund the cyclical effects of recession and to pay for a substantial programme of public spending and investment to stimulate recovery and growth. The Chancellor has successfully avoided a repetition of the Tory "boom and bust" cycle, and I want him to retain his good reputation by borrowing and spending to sustain our economy in what may be difficult times ahead. The Institute for Fiscal Studies gives more pessimistic forecasts about the Government's likely fiscal deficit, but that should not worry us: the Chancellor has plenty of headroom.At around 32 per cent. of gross domestic product, the Government's gross debt is far below that of other major economies, miles below the Maastricht limits and substantially lower even than the Chancellor's self-imposed ceiling of 40 per cent. In gross terms, the Chancellor therefore has at least £80 billion to play with, and his 40 per cent. ceiling is in any case simply an arbitrary level chosen by the "finger in the wind" method.
Domestic consumer demand will be hit by the pricking of the house-price bubble and the stock market slide. Consumers are already drawing in their horns, and the Government will need to use their own spending power to stave off recession. Monetary policy will also need to remain relaxed. I urge my right hon. Friend the Chancellor to remember his Keynesian youth and ignore the sirens of sound money who would lure us on to the rocks of deflation if they had their way.
Lower interest rates will also have a beneficial effect on the exchange rate, with a depreciation helping domestic manufacturing and to deflect demand away from imports towards the domestic economy. The Chancellor may need to be bold with both fiscal and monetary policy, and he has plenty of scope to do just that.
I hope, too, that if the Chancellor needs to relax fiscal policy still further, he should focus on spending rather than tax cuts. Boosting state pensions would help. Most pensioners have a high propensity to consume: that is to say, when they have extra money they spend it because they need to. That drives demand directly and immediately into the economy, whereas tax cuts tend to find their way into the bank accounts of the better-off, stimulating demand much less. That also has the benefit of helping the poor rather than the rich and it is socially just.
My second concern is in a way to help the Chancellor with his spending policies—to help him spend Government money more wisely and most effectively. Privatisation and private finance initiative schemes have largely failed, some disastrously. The railway privatisation has seen the cost of railway maintenance rise by more than three times and the cost of laying a mile of track increase by four times in the space of just nine years since privatisation. It has been a catastrophic failure and the railways are still in deep crisis. Taking the whole system back into public ownership in an integrated publicly accountable system would save the Exchequer billions and bring us better railways into the bargain. With more time I would be happy to speak in praise of British Rail, whose only real weakness was that it was starved of funds for decades.
In the education sector, of the 10 privatised education authorities, five have been rated as poor by the Office for Standards in Education, three unsatisfactory and only
one satisfactory. In Southwark, W.S. Atkins is pulling out of a £100 million contract to manage the borough's schools because—surprise, surprise—it was not making anything like as much money as it had expected.All the privatisation, PFI and public-private partnership schemes will cost the Exchequer more than would similar schemes funded by public expenditure. The reality is that private borrowing costs much more than public borrowing, and of course compromises have to be made because profits have to be made on top of borrowing costs.
The Chancellor has rightly drawn attention to Britain's long-term low interest rates.
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