Examination of Witnesses (Questins 1-19)
RT HON
ED BALLS
MP, DAVID BELL
AND STEPHEN
MEEK
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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