Select Committee on Children, Schools and Families Minutes of Evidence

Examination of Witnesses (Questins 1-19)


9 JANUARY 2008

  Q1  Chairman: Secretary of State, it is a pleasure to see you. We have been limbering up, exercising, jogging—the whole team has been out jogging in the morning—and doing all sorts of interesting and zen exercises to limber up for this day, so we are really on our mettle. I am sure that you have been doing the same. We are ready to go. I did say that I would give you a chance to introduce today's discussion, as long as you are reasonably brief.

  Ed Balls: I will be very brief. May I say that it is a great honour to appear for the first time before the Select Committee, and to be the first Secretary of State in the new Department for Children, Schools and Families to appear before this new Committee? I know that there are a number of new Committee members, but that a number of members have served for years. Given your length of experience and knowledge, Chairman, I have no doubt that you will know far more about pretty much every subject that we discuss today than me. That might be true of some other members of the Committee.

  Q2  Chairman: Are you trying to stop me asking hard questions?

  Ed Balls: May I introduce David Bell, my Permanent Secretary, and Stephen Meek, who is the Director of Strategy and Performance at the Department. He has been responsible for the co-ordination of the Children's Plan and for our discussions on the spending round and spending review over the past year. There are two things that I want to say very briefly. First, our discussions today are around the Children's Plan, which was published just before Christmas, and related issues. When I made the statement, Chair, you asked me how we would be reporting on the Children's Plan, and I made a commitment that we would make a formal report back on progress in a year's time. Within the Children's Plan there are some areas where we have set out very clear and detailed actions, with money to start from this April. For example, there is the roll-out of our youth services investment, children's play and investment in children's playgrounds, nursery places for two-year-olds, and a number of investments in work force development. There are some areas where we have said that because of the consultation that we have done on the Children's Plan, we now need detailed reviews. One area, obviously, is the review that I am now doing jointly with Alan Johnson into children's mental health services—into CAMHS—which is very much a product of the consultation. The Byron and Bercow reviews are going ahead. There is a third area of policies that I would highlight to the Committee where we have set out in the Plan a detailed direction of travel, but where there is still a lot of work to be done and consultation to take place. I would, for example, cite the ways in which we want to engage parents in more detail and more systematically in schools. There are plans for masters degree qualifications for teachers. We could also add to that list our direction of travel on exclusions policy. I know that this Committee has had a tradition of scrutiny and also, in some ways, of pushing forward the policy debate and the policy agenda. Those areas, and also the co-location of children's services in the 21st century school, could be areas in which the Committee might want to do work or make inquiries that can actually contribute to the development of that policy. That is obviously a matter for yourselves, but I think it would be very positive if we could have future dialogue in more detail on some of those areas. One particular review that we announced in the Children's Plan is the Rose review into the primary curriculum, and this morning I have taken the opportunity to put a Written Ministerial Statement before the House. I have also put in the Library a detailed letter to Jim Rose, which I believe was circulated to the Committee in advance, setting out in more detail the terms of reference for the Rose review: the importance of more space in the primary curriculum for reading, maths and writing—for the basics—the requirement for a modern language to be taught, and the ways in which there can be greater continuity in and out of primary schools from early years and then into secondary schools. Another issue that I have highlighted for Jim to look at is summer-born children, because evidence from the work of the Institute for Fiscal Studies and other areas shows that summer-born children can be set back because of starting school late, or because of their age when they start school, and those effects can last through their school life. I have asked Jim to look at how the primary curriculum can be tailored to meet the needs of summer-born children and also to respond to the views of a number of parents in our consultation who said they would like more flexibility so that their children would be able to start in September, even though they are summer-born, to start mid-year, or even to have the opportunity to start a year later. I have asked Jim to look at that issue of flexibility in entry as well as the curriculum with regard to summer-born children. That is one example of a review that will take place over the next year. We are hoping to have an interim report by October 2008 and a final report by March 2009. I am sure that the primary curriculum will also be an area on which the Committee will take a particular interest as we implement the Children's Plan over the next year.

  Q3  Chairman: Thank you for that, Secretary of State. May I ask how long you think you are going to be in the Department?

  Ed Balls: I have no idea. I know there were a number of Secretaries of State in the previous Department. Obviously, I am the longest-standing Secretary of State for Children, Schools and Families that there has ever been. I have always believed that a good rule in politics is to ensure that you plan your strategy five to 10 years ahead and never assume that your security of tenure will last the day. It is important to be conscious about not making mistakes. You always need to have a short-term awareness of the importance of being on your mettle and also plan ahead. Today, my ambition is to get through this morning.

  Q4  Chairman: When I describe the situation in the Department, some of us are worried. If you describe the Department, there is a constant churn of leadership, middle management and all those elements that we have seen over the last few years. If it were a school, it would be put on special measures—David Bell is smiling there—but the Department is not on special measures. David Blunkett was in education for a full four years and one month and was followed by someone who was there for one year and two months. They were followed by Charles Clarke, who was there for just over two years, and then by two others for one and a half years. There is instability in the education job. Does that instability allow the Department to build and develop itself and to deliver on its strategy?

  Ed Balls: In some ways, the broad range of responsibilities that we have, and the fact that I am working closely with, and in some areas have joint responsibilities with, a number of other Departments is helpful to me. In the area of children's health, I am working with a Health Secretary who was Education Secretary last year, and in the case of the Home Office, I am working with a Home Secretary who was recently Minister for Schools. On transport and school travel, I am working with a previous Education Secretary. The fact that there is a range of expertise in schools and children's policy across other Departments is a help to me. When I started this job, I said that I thought that it was the best job in the Government. Nobody would want to give up the best job in the Government quickly, and I would like to see through the implementation of the Children's Plan and the Rose review, and there are a number of different things that I want to do over the next few years. I am not agitating for any change of job but, as you know, these things are above my pay grade. Whether I stay in any particular job, or indeed whether I stay in any job at all, is not my decision.

  Q5  Chairman: What I was trying to get at was the situation for the staff—the people who actually deliver in the Department, out in the schools and colleges, and across the educational sector. This instability in leadership would not go on in the private sector, or in a college or school. I was suggesting that a period of stability might be quite a good thing in the new Department.

  Ed Balls: It was an advantage to me that the two Ministers of State for children's policy and for schools policy stayed in the same job following the last reshuffle. Having spent 10 years at the Treasury preaching the message of stability, I am happy to say now that stability in education, schools and children's policy would be a good thing.

  Q6  Chairman: Okay, let us get started on the real questions. Ten years ago, a Labour Government were elected and said that education was their great priority—remember the reiteration of the education theme? In subsequent general elections, education was again of the greatest importance. Is that still the case, even when we know that the money that will flow into education will start to plateau and not be as much as it was over the last number of years? Is education still the top priority of the Government?

  Ed Balls: I would say undoubtedly yes.

  Q7  Chairman: What evidence can you give us that that is the case, if the budgets flowing to education are declining?

  Ed Balls: We have two Education Secretaries in the Cabinet instead of one. A landmark piece of legislation is being introduced on Monday with the Second Reading of the education-to-18 Bill. The Children's Plan is involving other Departments in the education of children agenda in a much more intensive way than has been the case until now. Even though the overall profile of public spending has slowed for all Departments in this spending round compared with the last one, this Department has one of the fastest growth rates of spending. It is rising not only in real terms, but as a percentage of gross domestic product in the economy. When, in the pre-Budget report, extra resources were being found for public spending, they were found for health and for education. Any Prime Minister who wants a strong economy and a fairer and more socially cohesive society must tackle issues such as crime, but if he also wants to ensure that there is opportunity for all and not just some, he knows that education and schools and children's policy must be at the centre of the Government. That is reflected in the new Department.

  Q8  Chairman: How do you react to the statistics from the Office for National Statistics that seem to suggest that the most productive years for education spending were the last couple of years of the previous Conservative Administration and the first two or three years of our own Administration? Those were days of less resources, rather than more. Those statistics seem to be saying, or some people interpret them as saying, that, in terms of measuring productivity, as enormous amounts of money started to flow through education, the management capacity to deliver on that investment was not there. Do you share that concern?

  Ed Balls: I do not. I think that measuring productivity is difficult in an area such as education. In the case of manufacturing or the productive part of the economy, because of technological change and new innovations that can save labour and allow more efficiency, there is an assumption that productivity should accelerate through time and that productivity growth can be faster. In the case of a public service such as education, it is not clear that you expect a similar kind of thing to occur. Going back to the period around 1997, if we are honest, we had had quite a few decades in which spending had been quite low and we had also made very little improvements in standards in test results. Therefore, in the early years of the Government, the fruit was relatively easy to pick. I think that we have raised standards over the past 10 years and that we have gone from being below average to above average, with still some way to go. As you raise standards, it becomes harder, not easier, to make progress because you are either dealing with more entrenched disadvantage, or having to tackle children with learning difficulties. For those children to make progress, they are going to need more intensive support, smaller class sizes and more teaching assistants in the classroom. When measured by the rather simplistic view of productivity, if you have smaller class sizes or more teaching assistants, it means that productivity has gone down. That would mean that you would have less output per person employed or less output per pound spent, but actually, in terms of the results and the progress for children, you are achieving much more by helping those children to make progress than if you are simply helping the average child to make progress. It is perfectly natural in education for measured productivity to fall as standards rise. That is because you have to have more intensive effort on the hardest-to-help children so that they can benefit from excellence.

  Q9  Chairman: We will drill down on productivity a little later. In terms of the balance of the Department and its delivery on its mission, the schools side of the Department looks reasonably well organised. You have inherited that bit—it is there and a solid foundation. The children's side is much more difficult. We on this Committee are finding that side more difficult because you are not the only Department involved. If you go back to Work and Pensions questions on Monday, the first question was on child poverty. If you want to know about obesity, children's mental health and teenage pregnancy, you go to the Department of Health. Then you go across to the Ministry of Justice if you are looking at young offenders, the conditions of young offenders institutions, and the lack of education and skills of young people who come out of those institutions and of a real programme for them. So, it is a very disparate and different role compared with the schools side. How are you going to get a handle on it?

  Ed Balls: What you describe is the reality on the ground for head teachers and directors of children's services as well. If you, as a head teacher, want to drive up standards for all children, you must rely on what influence parents are having on children's learning at home, and you need the support of children's mental health services or social services. The quality of housing also makes a difference to children's ability to learn. The best head teachers are working in partnership with different public services with different budget lines. Every Child Matters at the local level—the idea of a children's trust—is an attempt to bring together that range of different services and different budgets and to make them work together. At the national level, we have tried different ways to make that work in the past 10 years. We have tried children's Ministers and children's committees. What we are doing here is by far the most radical attempt to make this work, through having a set of overt joint responsibilities. I am jointly accountable to Parliament and this Committee, with Jack Straw, for every aspect of youth justice and youth justice policy, even though most of the budget for youth justice is in either the Ministry of Justice or the Home Office, rather than my own Department. I am jointly responsible for children's health, even though most of the budget spend is with the Department of Health. That means that we need to use our influence in every way that we can to try to drive performance. We have invested a huge amount of time and effort, through the Children's Plan, in putting together our new Public Service Agreements via the Machinery of Government in Whitehall to make a reality of those joint responsibilities. There is much more intensive, cohesive working between different Departments on children's outcomes than I think that we have had before in Britain. I think that we are also leading other countries in trying to do this. As you say, it is about influence and leverage, rather than simply the allocation of your own departmental budget.

  Q10  Chairman: When the previous Committee conducted a major inquiry into Building Schools for the Future—Sustainable Schools—we drew some significant lessons about how important the visioning process was in every local authority in England. It is absolutely crucial because this is one opportunity for a local authority area to say, "This is the kind of educational provision for our people into the middle, and perhaps even to the end, of the 21st century". Certainly, the Committee got the feeling that that was of the utmost importance. Very rarely do you get the opportunity to say, "We applaud the fact that local authority areas were given that chance." Would you agree that if every partner in that delivery of education in a local authority area is not part of that process, it is a much weaker one?

  Ed Balls: I would, and I think that that is the conclusion of the Children's Plan. I spoke to the Association of Directors of Adult Social Services and Association of Directors of Children's Services annual conference a few months ago—early on in the job—and said that I thought that sometimes in the past the Government had not sent a clear enough message to local government about its role. I think that local government has an important strategic role in the delivery of education and children's services, and in driving performance. One very important part of that is planning school and wider services' infrastructure. When we talk about the co-location of services, it is not about only schools and education. We are saying in the report that we want Building Schools for the Future to create expectations and to remove any barriers that get in the way, in local areas, of being able to plan schools and wider children's services in a more co-located way. That could only be done from the local area, based around a director of children's services working closely with schools.

  Q11  Chairman: Does it worry you that a very important part of the faith community—the Roman Catholic Church—seems to have taken a very different view from that at the time when we visited the Academy of St Francis of Assisi in Liverpool? We saw a successful Academy—a joint Anglican and Catholic Academy—and many of us thought that it was a model to be looked at and perhaps used in other parts of the country. Is it not disturbing that we are told—certainly I have been told—by many of the leading Catholic educationalists that that experience will not be repeated and, secondly, that in certain areas of the country, the local authorities are finding it difficult to engage with the educational hierarchy of the Catholic Church in their diocese?

  Ed Balls: When I arrived in the job, I inherited an advanced piece of work called Faith in the system, which was about the role of faith education in our country. My experience, from the work that I did with all faiths in the final preparation of that document, including the Catholic faith with Cardinal Cormac Murphy-O'Connor and also the Archbishop of Birmingham, was that there was a commitment in the Catholic faith, as in other faiths, for those schools to play their proper role as part of the wider community. That can be through individual multi-faith Academies, which I have supported myself, or more generally through faith schools playing their part in the wider community and the delivery of children's services. If messages are being sent, within any faith, that individual schools should go it alone, I would certainly be concerned.

  Q12  Chairman: Thank you for that. Lastly, have you seen the Runnymede research? It is not complete yet, but you have certainly had the first draft. It suggests looking at a school system that includes faith schools successfully and prepares young people for living in a multicultural society. However, the initial research suggests that faith schools can have a negative effect on community cohesion. How do you react to that research?

  Ed Balls: I have not studied the details of that research, although my officials will have done. I know that a year ago there was substantial concern about whether faith schools were playing their proper part in promoting community cohesion, and my predecessor had discussions on that. As a result, alongside Faith in the system, we made a commitment to produce guidance for all schools on how they should promote community cohesion. One thing that came out of that work was many examples of faith schools that were leading efforts to promote community cohesion in their areas. There are therefore some very good examples in both the non-faith and faith systems of schools that are promoting community cohesion. I want that best practice to apply to all schools, and that must mean all faith schools as well as all non-faith schools. The obligations regarding community cohesion should also be mirrored in, for example, fair admissions. In my discussions with faith leaders, they all agree that the admissions code has an important role to play and that they have an important role to play in ensuring that admissions policy is fair across all schools, including all faith schools. I know that in recent weeks you have expressed concerns about sex and relationship education, and that is also an area where I think it is important that, consistent with the views of individual faiths, all children in all schools, including all faith schools, are being given the proper support and guidance.

  Chairman: Thank you for that.

  Ed Balls: May I say, to be absolutely clear—there is sometimes confusion about this—that it is not the policy of the Government or my Department to promote more faith schools? We have no policy to expand their numbers. That should be a matter for local communities. In some local communities, there is support for faith schools and in some there is support for schools moving from the independent sector into the state sector. In other areas, from contact that I have had with both faith leaders and local Members of Parliament, I understand that faith communities are clear that faith schools are not the right thing for their communities. We want to support those communities to make their own decisions, but we are not leading a drive for more faith schools.

  Chairman: Thank you for those opening answers.

  Q13  Mr Chaytor: Secretary of State, in the 2004 Comprehensive Spending Review, the Department was required to make £4.3 billion of savings by the end of this financial year. Is the Department on track to make those savings?

  Ed Balls: In some areas, as I understand it—David is more of an expert in the detail than myself—we have actually exceeded our expectations. For example, we have used the expansion of support staff as a way of enabling schools to do more within their budgets and that has helped us. Next week is the five-year anniversary of the partnership agreement between the Department and the unions and employers. That partnership is a very striking example of effective work between Government, employees and employers. It is a very strong asset for our Department and a major reason we have been able to make progress on efficiency over the last four years. The partnership has enabled workforce reform that has released substantial resources to be applied within schools. In use of technology, we have made significantly faster progress in introducing efficiencies in technology in schools than we expected in 2004. Also, a number of schools have been using specialist leadership, for example school bursars, as a way of releasing substantial amounts of money. One by-product of the reforms around trust schools has been a number of small schools or primary schools seeing that one reason to come together in clusters or to have trusts around a pyramid is because you can make substantial efficiency savings in non-teaching expenditure, rather than duplicating across a range of small schools in an area. So I think the answer is that we have exceeded our expectations.

  David Bell: Yes, we are ahead of trajectory at this point in the programme. Because of the change in departmental arrangements, we have split the responsibility for the £4.3 billion between ourselves and the Department for Innovation, Universities and Skills, although the bulk of it remains with our Department. We are ahead of trajectory and the examples the Secretary of State gave are good examples of the progress we have made. There are two other elements of the efficiency programme. One is in relation to staff numbers within the Department and Ofsted and we have now achieved that target ahead of the end of the year. The other is a relocation target of 800 posts outside of London and the South East by 2010 and we are well ahead of trajectory. We will hit the 2010 target because of relocation of organisations like the Training and Development Agency and the Qualifications and Curriculum Authority.

  Q14  Mr Chaytor: May I ask another point of detail on the trajectory? The Autumn Performance Report said that by September 2007 you would have achieved £2.8 billion of savings. It then said that £1 billion of that is cash savings and £2.6 billion is recyclable savings. Surely £1 billion plus £2.6 billion equals £3.6 billion. How does that square with the claim that you have saved £2.8 billion?

  David Bell: I will have to check the detail of that, but we know the efficiency programme is put together as a combination of real cash savings and non-cash savings. The restructuring of the teachers' pension scheme involves real cash savings. The technology programmes the Secretary of State mentioned or the use of teaching assistants to give teachers more time involve non-cashable savings. But I can assure you we are ahead of the trajectory. What we will not be able to do, because of the time lag involved in gathering the data, is to say on 1 April 2008 that everything is secure, because we need the data returns into the Autumn of 2008 before we are able to confirm the programme. However, I understand that the report from the Treasury to the Chancellor and the Prime Minister has given our programme an "amber green" rating; in other words, we are expected to achieve the programme.

  Ed Balls: Shall I write you a letter setting out the latest position in terms of progress on efficiency on the 2004 and 2006 commitments? I would be happy to do that.[1]

  Q15  Mr Chaytor: Perhaps you could clarify it, because to the casual reader £1 billion plus £2.6 billion does not equal £2.8 billion—I refer to page 48 of the Autumn Performance Report.

  Ed Balls: It is a moot point how many casual readers would have seen that page. For the expert reader it has obviously left a question, which we will answer for you.

  Q16  Mr Chaytor: May I ask a more general question? You are now going to require schools in the next CSR period to achieve 1% efficiency gains. It is the first time that schools have been asked to do this. Will the definition of efficiency for schools be the same as that applied to the Department? That is, will the 1% be partly cashable and partly recyclable?

  Ed Balls: We are saying that within the overall funding supplement for schools we think that they can meet all their needs and all our priorities on the basis that within that overall sum they release resources equivalent to around a 1% rise in the budget a year.

  Q17  Mr Chaytor: Is that all cashable?

  Ed Balls: They are all recyclable within the school. It is a matter for the schools to decide the balance of cashable versus recyclable. It is not something we are dictating from the centre. Obviously, if they do not make any efficiency savings at all they will have less money to spend, but that can either be through money that they cash and then spend or recycle. Is that right?

  David Bell: Yes.

  Q18  Mr Chaytor: As we move forward into the next CSR period, what is the balance between spending on schools as against spending on post-16 or post-19 likely to be? In the last couple of years we have seen a tilting away from schools and children towards adult skills and the university sector. Will that trend continue, or do you envisage that the balance will now move back towards children, schools and families?

  Ed Balls: We have split our budgets between the new Department for Children, Schools and Families, which spends up to 19, and the new Department that spends post-19. In a sense, for the next three years the money to spend is as set out in the pre-Budget report, which set out those numbers. I am sure you have them, but we can easily give you the breakdown of exactly how those budgets were split. I am not sure that I have the precise split in front of me.

  Chairman: We do not need that.

  Ed Balls: For me, the issue is more how we choose to allocate expenditure within the 0-19 group; the split between pre and post-19 will be a matter for the next spending review post-2011, but up to 2011 it is now determined by the split between the two Departments.

  Q19  Mr Chaytor: In terms of projection up to the age of 19, what is the relationship between the spending plans and the allocation over the next three years and beyond and demographics? Does the Department have projections of the likely number of children in our schools over the next 10 years—that is, the period of the Children's Plan?

  Ed Balls: Yes.

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