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Mr. Clarke: Perhaps I could visit the hon. Gentleman in Harrogate this summer and lounge on the beach while I consider what to do. On the other hand, I might find that people come up and shout at me, having been inspired by the hon. Gentleman.
I am delighted by hon. Gentleman's warm welcome for the substance of our proposals, particularly on the two-year deal, the standards fund and the extra resources. It is a shame, however, that he had to hide it under a great shower of rhetoric that did not add up to much.
I have acknowledged throughout, and continue to do so, that mistakes were made in relation to the shared responsibility of my Department and local government for funding schools. I have said that in this House and in the Select Committee, and I have sought to analyse why and how it happened. It is precisely because we need to rectify those mistakes that I am making this statement. It is important that schools are well managed—that is why recovery plans to deal with deficit budgets and suchlike are necessary. It is not the case that a tap of money is turned on and schools spend, spend, spend. The situation has to be well managed and well directed, and that is what we will do. We are modelling the proposals in detail; I was at pains to point out the various consultations that I intend to have with local government, head teachers and others.
On the hon. Gentleman's remarks about the funding formula, it is not necessary to withdraw a proposal that I never made.
Joan Ruddock (Lewisham, Deptford): I welcome my right hon. Friend's statement, which contains much to encourage us. I particularly thank him for the additional money for children's social services, as we had been greatly concerned that that might be badly affected by his ring-fencing. Can he clarify how the baselines will be established? Many schools are adopting deficit budgets, and unless they get back to where they should have been, an increase for 2004–05 will not be sufficient and may lead to redundancies, which we have managed to stave off for the moment.
Mr. Clarke: I am grateful for my hon. Friend's general support. Having discussed the situation with many of her colleagues in the London borough of Lewisham, I am well aware of the pressures that her local schools have experienced. I want to make two points in response. First, I have been told by many schools, governors and local education authorities that the single most important thing to sort out at this stage is certainty about the future and stability. That is what I sought to offer in the statement.
Secondly, I acknowledge what my hon. Friend says—we have discussed it outside this Chamber—about schools that have spent from reserves or from devolved formula capital, or where deficit budgets have been set. I also acknowledge that in some cases resolving those issues could be beyond the capacity of individual
schools and LEAs. In those few cases, I will be prepared to consider limited transitional support to avoid damage to children's education and consequences such as those that my hon. Friend describes. However, that must be part of a locally agreed recovery plan. The local authority—in her case, Lewisham—and schools must discuss among themselves, then agree with us, a plan that will deal with such problems. That is the responsible approach, and it allows stability for the future.
Mr. Andrew Turner (Isle of Wight): The Secretary of State is welcome to come to the Isle of Wight to lounge on the beaches, where he might meet the 40 or so staff who have lost their jobs as a result of this year's schools funding crisis. He said in his statement: "LEAs, heads and governors will work together through their schools forums to agree the funding baseline to which the guaranteed per pupil increase will be applied." Does that mean that this year's increase might be based not on the actual funding, but on a lower figure?
Mr. Clarke: That depends entirely on pupil numbers and the overall situation. I accept that, as my hon. Friend the Member for Lewisham, Deptford (Joan Ruddock) said, there are issues involving deficit budgets. We will take those into account in the way that I set out.
Mr. Peter Mandelson (Hartlepool): In warmly welcoming my right hon. Friend's statement, I suggest that he needs not only to ensure that there is a stable and predictable funding system in future, but to provide ample flexibility for individual schools to experiment with new teaching methods and innovative use of resources on their premises. In that context, I commend to him the online learning system that is being pioneered by Manor college of technology in Hartlepool. The point is that without greater freedom and flexibility being permitted for individual schools, such innovative teaching advances are likely to remain restricted in the future.
Mr. Clarke: I entirely agree with my right hon. Friend, which is why I so energetically rebut the suggestion from the Opposition Front-Bench spokesman that I am interested in micro-managing schools. The truth is exactly as my right hon. Friend says: not only Manor college in his constituency but a large number of schools in the country are behaving in an innovatory way in an entirely outstanding application, for example, of information and communications technology, with different partnerships outside the school, which is all focused on raising educational standards. That can be done only if there is freedom and flexibility at the school level. That is what this statement is designed to offer.
Mr. Peter Luff (Mid-Worcestershire): As many Worcestershire schools have welcomed the increased capital money made available by the Government to local schools, I am sure that they will welcome aspects of today's statement. They will be concerned, however, that the Government have brought forward no proposals at all to address the growing gap between Worcestershire's funding and the English national funding average, despite teachers being paid on a
national pay scale. When will the Government address the iniquity of schools in similar situations in similar local education authorities getting wildly different sums of money, which is forcing counties such as Worcestershire to charge their council tax payers considerably more than the Government think that they need to?
Mr. Clarke: I, too, represent a shire county in which the kind of issues that the hon. Gentleman raises are real. We have asked the School Teachers Review Body this year to look at whether there is a case for regional variations and so on, which is part of my remit letter that I published last Friday. To be blunt, the key area in which that is so important is London and the south-east, where there is already a whole system of extra pay to deal with those circumstances. It is a bigger factor there than in some other parts of the country, including Worcestershire. It is important to make an assessment, however, for the reasons that he states.
Glenda Jackson (Hampstead and Highgate): Could my right hon. Friend help me by giving a little more detail about how the budgets for the following years will be defined? Despite my local authority, Camden, passporting all Government money to our schools, and despite finding an additional £1.8 million from other budgets for education, it is still facing a shortfall of £1.5 million. That is resulting in a loss of teachers and classroom assistants, deficit budgets, of which there have been 14 to date, and capital projects are being lost as well as certain educational programmes. Will he help me by saying what will be the minimum budget, given that there can be no argument that Camden has always passported, and will continue to passport, all Government money, and has always found additional funds for education?
Mr. Clarke: I join my hon. Friend in paying tribute to Camden council, which has had substantial discussions with my officials and schools within the borough to address the problems there. As she knows, Camden is relatively well funded, being the seventh highest-funded education authority in Britain, but it has had serious issues that it has been seeking to address in a constructive way. For the reasons that I gave earlier, I am not prepared to put a figure on the amount of money that we are talking about until we know the pay review body settlement in particular, because that will be important. One of the issues this year was that the pay review body recommended, and I then agreed, a significantly greater pay increase in inner London, in boroughs such as Camden, than across the country, for the reasons that were referred to in the question from the hon. Member for Mid-Worcestershire (Mr. Luff). I agreed that but it put greater pressures on the budgets of schools in inner London. That is why I am not prepared to give a figure for next year until we know exactly what the situation will be on teachers' pay.
Sir Sydney Chapman (Chipping Barnet): Whatever the merits of the right hon. Gentleman's statement this afternoon, he seems not to have addressed the real crisis that exists at the moment. That can be no better explained than by looking at what happened in Barnet, where the Government, through the revenue support
grant, gave an additional £8.1 million to cover all services, but required the LEA to pass on £14.5 million to the schools, which the local education authority has done, causing a huge hike in the council tax. He has admitted that there have been failures, and that problems exist, and Barnet brought in an independent consultant who totally vindicated the LEA. Will he look at how, this year, he can immediately redress the injustice and help Barnet to cover this deepening crisis?
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