Draft Contracting Out (Local Education Authority Functions) (England) (Amendment) Order 2003

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Mr. Phil Willis (Harrogate and Knaresborough): Mr. O'Hara, may I also welcome you to the Committee—but briefly, so that we can move on?

I support many of the comments made by the hon. Member for Wealden (Mr. Hendry) and want first to draw the Minister's attention to the issue of confidentiality and impartiality and how that will relate to the appeals process. The admissions service carries out a relatively simple task. It is purely administrative. However, administering the appeals service in relation to the voluntary-aided, foundation, controlled and community school sectors is a very difficult job, which might be open to all sorts of accusations.

Will the Minister clarify why the order is necessary? We will not oppose it, but great play was made of the fact that under the Education Act 2002 local authorities would be able to apply for the powers to innovate. In that context, I would imagine that if a local authority wanted to innovate by contracting out administrative services, it would be able to do so. I therefore wonder why the Minister is not allowing local authorities that want such powers to go through that process instead of the one under discussion. Perhaps we could be saved from coming back if there are in fact other powers that the Minister wants to extend to local authorities.

Thirdly, could the Minister clarify whether the contractors in areas where the Government have ordered that all education services be contracted out—for instance, in Islington, Southwark and Bradford—already get all the relevant powers? Will those local authorities retain the powers that he is allowing to be contracted out?

With that, we are happy to support the proposals.

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2.56 pm

Mr. David Drew (Stroud): I shall be brief, but it is a delight as always to serve under your chairmanship, Mr. O'Hara.

I should like some reassurance from my hon. Friend the Minister. The hon. Member for Harrogate and Knaresborough (Mr. Willis) said that the issue was relatively uncontroversial and relatively straightforward. Well, I wish that it were in Gloucestershire too. In fact, it is incredibly controversial, because although we do not have a huge number of appeals, those who fall foul of the system feel very aggrieved, to the extent that some people in my constituency are still keeping their children at home, because they do not feel that they have had justice.

I seek reassurance from my hon. Friend the Minister on the way policy interacts with process. We are, quite simply, for ever reorganising the policy on admissions. The system is a preferential system, and I try to persuade my constituents that it is not a system of choice; however, despite that, they do not necessarily understand, and feel that where there is, as I see it, flagrant abuse of that system, there is a need for someone to have some control. To use one example, a school outside my constituency has continued to recruit from within my constituency even though it has sufficient parents from its own catchment area, which causes problems, because the children of parents who for whatever reason choose to send them to that school are unlikely to get into it. The parents then of course expect their second preference to be met, but that does not necessarily follow.

I know that we are reorganising our policy once more next year, and perhaps it will be that much better. However, I should like an assurance that there will be some separation and that a contracted-out organisation will not present even more of a difficulty in terms of being able to hold the line and say to certain head teachers and governing bodies that they should be fair and honest, and not recruit where there is very little opportunity of being offered places. If that is not the case, the situation will be made even worse. On that short note, I hope that my hon. Friend the Minister will give me some reassurance.

2.58 pm

Mr. Miliband: I thank all hon. Members for the reasonable points that they have made. I shall probably leap at the suggestion of the Member for Wealden that I write to those hon. Members whose questions I cannot answer in to their full satisfaction.

The hon. Gentleman asked about the percentage of LEAs that have used the power in the past year. I cannot give him percentages, but I can point to Surrey, Lincolnshire and East Sussex, all of which have used the powers to varying degrees. We have not done surveys or used other bureaucratic means of finding out percentage returns, but if he is interested, I can write to him with further details on those examples.

Most of the questions focused on the co-ordination of admissions, and perhaps the biggest issue was the relationship between the policy making and the

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processes. I strongly reassure my hon. Friend the Member for Stroud (Mr. Drew) and the hon. Members for Wealden and for Harrogate and Knaresborough that there is no question of the contractor for the co-ordinating of admissions encroaching on policy-making areas, especially not on sensitive areas such as appeals, to which the hon. Member for Harrogate and Knaresborough referred. Those will remain matters for the LEA. The regulations relate to the co-ordination of admissions, and specifically to the administrative arrangements relating to that, such as the issuing of consultation letters, the collating of responses and the management of the data, to which I referred in my introductory remarks.

Before the debate, I asked for examples of variations in the costs of these activities across LEAs, which are really quite striking. For example, the cost of organising admissions varies from about £1 per pupil in some LEAs to about £21 per pupil in others. That must partly reflect the size of the LEA and the complexities of its arrangements. None the less, that is a striking variation in cost. I am sure that we all agree that the priority should be to invest as much money as possible in teaching, learning and schools, rather than to spend it on administrative processes.

The larger figure for central administration, which includes admissions and insurance, varies from £1 per pupil to £78 per pupil. There are therefore large variations in the cost base. The Department can take steps to help LEAs to squeeze the unproductive costs. We have, for example, recently sent LEAs a benchmarking table of what different processes cost in different LEAs to help them to work out where they are spending more than the regional or national average so that they can do something about it.

The hon. Member for Wealden asked what factors the LEAs should consider when taking their decisions. That is entirely up to them. The order is about LEAs taking, and justifying to themselves, decisions on the basis that an administrative process or contracting out a particular function can save them time and money and allow them to focus on their core functions. As I said, they can contract out to another LEA as well as to a voluntary or a private sector organisation. That reminds me of the hon. Gentleman's question whether the contracting out has so far been to the private sector or to other sectors. We have examples of contracting out to the private sector and to the non-profit sector. We do not yet have examples of contracting out to other LEAs, although I know of one LEA in which that will be done.

On confidentiality, the simplest answer is that the same rules would apply to a contractor as they would to an LEA. There are clear national guidelines and legislation relating to issues of confidentiality. Any breach of them would be a very serious breach of contract.

The hon. Member for Wealden also asked about child care and what sort of audit would be carried out. I shall write to him with the details. The order relates to an auditable child-care provision in an area, which the child care information services are designed to assist.

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The hon. Member for Wealden also asked if I believed that the future of LEAs was as ''contract managers''. I do not. They are democratically elected local bodies, and our clear view, first set out in a 1998 Green Paper and subsequently in speeches by successive Secretaries of State, is that LEAs are there to help to support school improvement and to ensure that those pupils not in schools receive appropriate provision to support their attainment in education.

The hon. Member for Harrogate and Knaresborough asked me three questions. One related to appeals, which I hope I have answered.

The second question was whether the power to innovate would be a more appropriate vehicle. The power to innovate is directed much more at teaching and learning in schools than at administrative functions. Each power to innovate requires an application to the Secretary of State. The order gives LEAs the freedom to take decisions in one go, rather than having to apply to us every time they want to contract out a different service, which, I am sure the hon. Gentleman would agree, would not be sensible, given that the legislation now covers 106 LEA functions.

I am afraid that the hon. Gentleman's third question has escaped me.

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Mr. Willis: Where an authority has contracted out all its services on instruction from the Secretary of State, has it also retained the administrative services, or has it already contracted them out?

Mr. Miliband: The short answer is that they have already been transferred out. When all an LEA's functions have been transferred out—Hackney is one example—the administrative functions are also transferred out. I shall write to the hon. Gentleman if that is wrong in individual cases. If there has been whole or partial contracting out, the contractor can in turn make contracts with the LEA or the council for certain functions. My understanding, however, is that they would have been contracted out already.

I believe that I have answered all the questions that were asked, including that of my hon. Friend the Member for Stroud. I hope that hon. Members are content to affirm the order.

Question put and agreed to.


    That the Committee has considered the draft Contracting Out (Local Education Authority Functions) (England) (Amendment) Order 2003.

Committee rose at five minutes past Three o'clock.

The following Members attended the Committee:
O'Hara, Mr. Edward (Chairman)
Cawsey, Mr.
Drew, Mr.
Fisher, Mr.
Hendry, Mr.
Miliband, Mr.
Ruddock, Joan
Skinner, Mr.
Twigg, Derek
Watson, Mr.
Willis, Mr.

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