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18 Dec 2007 : Column 776

Finally, I turn to the issue raised by my hon. Friend the Member for Ribble Valley (Mr. Evans). It involves every Member from the three main parties and probably has the support of the two minority parties represented in the Chamber today. At the last election, every Member elected from one of the three main parties stood on the platform that we would hold a referendum on the EU constitution; yet notwithstanding the fact that Giscard d’Estaing, who wrote the constitution, and everybody else on the continent, says that the reform treaty is exactly the same as a constitution, the Government, aided and abetted by the Liberal Democrat running dogs and their new leader, are reneging. They say, “Oh, we didn’t mean it”. Politicians are told that they lack integrity. I deny that—I hope I have some integrity; indeed, almost all Members of this place have integrity and want to stand by their word. That is important. What will the British public think of those who stand on a manifesto that states, “We will have a referendum on the EU constitution” and then change their mind? It is not acceptable.

I believe in parliamentary democracy and am not a great fan of referendums. However, I stood on that manifesto, and I demand that the Government stick by their promise and that the Prime Minister, who is in charge of the manifesto, sticks by his promise and that we hold a referendum. I hope that every hon. Member who stood on such a manifesto will support a referendum on the EU constitutional treaty.

Mr. Mike Hall: I am grateful to the hon. Gentleman for giving way and for his generous words about my contribution. If there was a referendum, how would he vote?

Mr. Robathan: I should most certainly vote against the constitution, but that is not the point. The point is that I promised my constituents that I would support a referendum on the treaty, as the hon. Gentleman promised his constituents—unless he had an opt-out.

Mr. Hall: It was not about the treaty.

Mr. Robathan: If the hon. Gentleman asks anyone in the Chancelleries of Europe he will discover that everybody thinks that it is.

If we want to restore the public’s faith in this place we must stick by our promises, and I am astonished to see that the Prime Minister seems to have lost his moral compass in this case. I do not know whether he will find it, but I hope that everybody will bear these points in mind when it comes to a vote. We said that we would have a referendum, so we should have one and fulfil our promise to the British people.

Madam Deputy Speaker, I wish you, everybody else in the House and all the servants of the House—the Serjeant at Arms Department, security personnel, people who work in the kitchens and the cleaners—a very happy Christmas.

3.53 pm

Dr. Ian Gibson (Norwich, North) (Lab): I agree with the last point made by the hon. Member for Blaby (Mr. Robathan) and disagree with almost everything else he said, although I do not have time to go into it— [ Interruption. ] Happy Christmas.

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I have lived in Norwich in Norfolk for some time, and it is a delight. With its big skies, the Norfolk broads, its beaches, its wildlife, and of course its people, Norfolk is a magical place. It has unique cultural values, with a heritage that goes back to the Romans—people are always turning up Roman towns and coins—which gives us a richness and feel for history that I really appreciate.

Last year we survived floods. We have one railway line between Norwich and London, and I hope the train will be on time tonight, although I doubt it. Last week the Evening News described the line as a “fine mess”, with signal failures, trees falling on the line, and even greenhouses falling on the line—that takes a bit of believing. There have been suicides, strikes, landslides, the derailment of a train with nuclear waste—unique—and closed tunnels. I can add to that list, with overhead cables and foxes on the line. It is a really exciting Michael Palin whirligig on that trip. We hope that something will be done. The cows on the line are quite appetising: none of them has any kind of disease as far as I can see.

I look forward to the continuing debate on the first academy in Norfolk—in Norwich, in my constituency, on the Heartsease estate. I quote again from the local paper—this time from a member of the public, who spoke of

He goes on:

That has not been refuted, as far as I can make out. A petition was raised on the estate. In the first trawl, over a couple of days, 400 people said that they were against the installation of the academy. There is no question about arguing the principle. They do not want the academy on this improving estate. I hope that Ministers will find time to meet me, and some of my constituents, in the not-too-distant future, before the decision is made.

I want to talk about the consultation on the location of complex needs schools and special resource bases in mainstream schools. That, of course, is the arena of special educational needs. It is often implied that people do not like change and always protest. I guess that there is some truth in that, but in this case people do want change. They want more to be happening and are prepared to get involved, if consulted properly. Norfolk county council is not famous for its consultation exercises, as I mentioned in relation to the academy. People want a genuine consultation.

I have various letters, all saying the same thing in their own way. A constituent of mine, talking about her granddaughter, says:

That is reflected in the views of many other people who have written to me.

The school is in central Norwich. It does a good job and is hugely oversubscribed. We need more schools like Parkside in Norfolk. Some children have to travel one and a half hours to the school from parts of north Norfolk. Why do we not have some sense of adventure and some ideas from the county council about developing a school in the northern half of the county? It is said that children who are at the school already will probably stay there, but that will happen only if the school is not closed, following the amazing consultation denoted by the glossy document that I have in my hand. My constituent went on:

in fact, it finished last week—

Parkside is a unique school for children with mild to moderate difficulties. Changing its remit to complex needs will completely change the school. Reducing the numbers will result in a loss of teaching staff and an inability to follow the curriculum in the same way. Many Norfolk schools are merely satisfactory, or are described as inadequate. Parkside is not one of those. It has an excellent Ofsted report. I cannot see why the county council would even consider changing a school that has such a success story. The council lacks foresight and an understanding of the problems.

There are various ideas in the document, and people are supposed to choose between them. Alternative options are presented, yet there is no mention of the Bercow or Ofsted reviews, which it is hoped will radicalise the whole field. Moreover, we have plenty of evidence that the teachers have not been involved in the process every step of the way.

We have already heard about cynicism today, and in this story there is a final point to be cynical about. We find that long after consultation has taken place on the academy, it has suddenly been decided that autism is a new issue, and some autistic children could be placed in that academy. It turns out that the person working in the county council who has made that decision is greatly pro-academy. I think that he is running the whole campaign on children with special needs.

Amazingly, we are told that Norfolk has few children in special school places. While the population of Norfolk has risen over the past 10 or 15 years, the number of special school places has not. We can talk about statistics, but the true figures have never been looked at. Despite Norfolk’s increasing population—it will continue to grow, with increased housing and so on—the number of young people who will have autism, Asperger’s and other special needs has never been determined. We will see new illnesses and diseases unfolding, so more children will need special care and attention in our schools. All
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those emotional and behavioural difficulties are being sidelined. Mainstream schools cannot cope with some of those problems, yet schools such as Parkside, which I have visited, are amazing. They have turned things round and given people a start in life that will, I hope, allow them to get jobs at the end of the day.

I do not believe that Bedfordshire can possibly have as many as four times the number of children with special needs as Norfolk. If anyone wants to change anything, they should get the true figures before they start the consultation. The document shows that the same number of children will be catered for, albeit spread around the county. The consultation might show that there is some sense in taking some children out of the middle of Norwich and sticking them out in the west of the county. For example, it is important to cut down journey times and to have a good local school. However, we would not be dealing with the problems, which would be shovelled aside into people’s houses. An amazing, and scandalous, number of carers in Norfolk look after not just the elderly, but young people who cannot get into the special schools.

We must talk to head teachers, staff and parents before the consultation results come out. There is an impression that far too often, the view of Norfolk county council is that everything has been decided and—to heck with the consultation—it will happen. The exercise excludes many of the key issues. It puts good schools at risk and does not consider future needs. Norfolk’s managerial system has a lot to learn from Alex Ferguson, who, for all his ways, is a great manager who gets things done successfully. Without vision, the people perish—and we are sitting on the edge of a volcano when that could happen to the many dozens of young people who require a specialist influence in their schooling at such a critical stage of their lives.

4.3 pm

Stewart Hosie (Dundee, East) (SNP): The Barnett formula concerns funding for the Scottish Parliament, Wales and Northern Ireland, and it has an impact on everyone in those nations, and in the Province. I wish to raise the subject because although the Barnett formula has been raised many times in the House over the past year—it was the subject of a Westminster Hall debate—and is often mentioned by commentators, the debates and discussions rarely concentrate on the Barnett formula itself. Barnett is used as a proxy, or shorthand, for other issues. It is used as a proxy when people discuss the imbalance in English regional spending, which I shall address. It is also used as a proxy for the West Lothian question, or the English democratic deficit, which is summarised by the ongoing situation of Scottish MPs—mainly, but not only, Labour MPs—voting on English domestic matters when this House cannot have any impact on decisions taken on those same matters in Scotland and Wales.

I do not want to defend the Barnett formula—far from it. It is, after all, designed as a convergence formula, and will, over time, squeeze the amount of money spent in Scotland compared with that spent in England. In the May 2000 document on Barnett produced by the Scottish Parliament, Professor Neil Kay said:

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In effect, a 4 per cent. increase for an English spending Department would be converted to an absolute sum of money, and when that was applied to the Scottish baseline, which was higher for historical reasons, the percentage increase would be less than the increase in England. It is therefore a convergence formula.

That is important, because it is all that the Barnett formula does. It is a means of allocating spending increases to Scotland on the basis of spending increases in England, but they are not comparable in percentage terms because the baselines are different. The Scottish Parliament has the authority to spend the block allocated, but the Scottish National party and I would prefer it to have the responsibility to set tax rates and collect tax.

I sympathise greatly with those, in the House and elsewhere, who are from parts of England where regional spending is perceived to be much lower than the English average, or significantly lower than the London or south-east average. However, from where I am standing—from the Scottish perspective—because Scotland has been in surplus for the best part of the last 30 years, even if its identifiable expenditure is higher than the average in some English regions, every last penny has in effect been raised from Scottish taxation.

The use of the term “identifiable expenditure”, or “net identifiable expenditure”, brings us to one of the key flaws in the argument that people use against Barnett. They base their analysis on net identifiable expenditure alone. There is rarely ever a glance at the imbalance in non-identifiable expenditure, which is heavily weighted to London and the south-east, and there is rarely mention of the other side of the balance sheet—the revenue side. To try to put the matter in some kind of context, in 1997, the then Chief Secretary to the Treasury, William Waldegrave, made it clear that Scotland had been in surplus from 1978 to 1995. In 2002, the work of the independent constitution unit proved the same point, explaining that Scotland had had an average surplus for the 20 previous years. Other work was done until only a few months ago by Oxford Economics. It told us that in the last year of its assessment, which was a few years ago, the figures were £9,600 per head in revenue, and £9,600 per head in expenditure. That broadly mirrored our figures for the same year—just shy of £50 billion in, and just shy of £50 billion out.

Even if identifiable expenditure or total expenditure was higher than any UK or English average, there would be no justification for a reduction in Scottish spending, even if the formula for funding were changed, because the spending is fully funded by Scottish tax returns. The bottom line on Scottish spending compared with English spending is that, according to the Library’s figures for the last full year in which it carried out an assessment, Scotland spends 41 per cent. of gross domestic product on public spending, while the UK average is 41.3 per cent. That is marginally higher but broadly in line.

The second and more basic flaw that opponents of Barnett make is to assume that different spending priorities are somehow indicative of a subsidy to Scotland. They are not. If hon. Members and commentators outside the House believe that English regions are not being properly funded—as I do—they should ask why, rather than point the finger at the Barnett formula, Scotland or the Scottish Government’s priorities.

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Let us consider why the Government have been unable to invest properly in some of the English regions where there is such a spending imbalance. First, the UK has an enormous black hole. A cumulative deficit of £540 billion is forecast for this year, and the borrowing requirement for this year is £38 billion. That debt was almost wholly built up over the past 30 years, when Scotland has been in surplus. The UK cannot borrow any more without stretching its already taut fiscal rules to breaking point.

Secondly, the Government cannot raise much more tax without people beginning to notice. The total business tax take is up, the total personal tax take is up, and council tax is up.

Thirdly—this will be important in the year or two ahead—the Government cannot get away with hiding hyper-expensive private finance initiative projects off-balance sheet in order to deliver the public expenditure that many hon. Members want to see. In the past three years, according to the July spreadsheet, the taxpayer’s liability in connection with PFI projects has risen to £179 billion for £53 billion of capital projects. That is a rise in the past three and a half years of some £55 billion—a rise in liability greater than the total sum of every PFI deal signed before the table was published in July. That route to more investment is finished.

There is an imbalance in English regional spending, but because the Government have borrowed too much, taxed too much and paid far too much for PFI, all that many people—including commentators outside the House—have left to do is to attack Scotland and the “subsidy” that we receive, which is, of course, a myth. Here is the rub: to cut Scottish identifiable expenditure to the English average would increase the amount spent in England by £150 per person, but it would cut Scottish spending by £7.5 billion—a quarter of the entire Scottish Government’s budget. That would be a ridiculous thing to do. Fortunately, few people argue for it, but we need to ensure that some of the siren voices that are always screaming about subsidies to Scotland do not get in the way and butcher public provision in Scotland.

As for regional imbalances in spending, it is worth pointing out that the PFI figures show that of the £53 billion for capital projects, £24 billion will be spent in London. Almost 50 per cent. of all PFI deals signed were allocated to London. If hon. Members are concerned about the imbalance of spending in their areas, they might first like to investigate the way in which PFI has been used.

Another factor is damaging the Government’s ability to invest: the trade gap. It is very important, although it is a subject that we do not often talk about these days. It affects our ability to invest because the tax take is down. We are seeing a reduction from where our GDP increases should be, because of the trade deficit. The impact of trade on GDP fell by 0.5 per cent. in the years from 2000 to 2004, and by 0.25 per cent. from 2006 to 2007. The total impact in money terms of GDP growth lost because of the trade deficit is approaching £30 billion. In Scotland, at £2.5 billion, that equates to almost £1,000 lost GDP per household in the past few years.

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