Public Expenditure - Children, Schools and Families Committee Contents

Examination of Witnesses (Questions 1-50)


21 OCTOBER 2009

  Q1 Chairman: May I welcome the Secretary of State and the Permanent Secretary to our deliberations. It seems an awful long time since we saw you. That is because of the summer recess, I am sure. As you know, this is our regular meeting. The first part will be on public expenditure and the second part will be on matters relating to the White Paper.

Ed Balls: Can I say, Mr Chair, it is a pleasure to be here for the fourth sitting that I have had with the Committee in this parliamentary Session alone. I think from the fact that you still have people coming through the door, we have a rather larger turnout from the press than usual. A thing that surprised me, arriving earlier, was that we also have a considerably larger police presence outside the room than on any of my previous appearances. I don't know why that is, but we have five officers here today with us, so we will see how it goes.

  Q2 Chairman: It's interesting you should say that. They tried to stop me coming in, which I thought was amusing. This is about two very substantive pieces of business, but it would be wrong of us not to very quickly allude to the discussion we have had in various ways on the post of the Children's Commissioner. Can I just put it on record that there has been some discussion that this Committee, and the Chairman in particular, have undermined the reputation of the person who was put forward. Can I say that in all the deliberations, in all the interviews I have done, I have tried to go out of my way to say that this woman is highly qualified, highly competent, and, for many jobs, if I had been sitting on the panel, I would have hired her on the spot. But this Committee did have reservations about her rightness for this particular role. We at no time tried to undermine this woman's reputation. Can I put that on the record today. That is not our intention and never was our intention. For us, we had reservations about this particular role, and that came out of the questioning. Perhaps the questions fell badly for her, but we were sitting here and we discussed it, and, as you say, nem con, we decided to advise against. But the one thing that has come out of this, and would you clarify this, Secretary of State, is that none of us in the briefing we had from the Clerks—you know how knowledgeable the Clerks are—knew about this Cabinet Office guidance, which you allude to in paragraph 2 on page 2 of your letter: "The guidance also says that there may also be occasions where a candidate's performance in front of the Select Committee is considered relevant to the post in question, but these occasions will be exceptional." When the Prime Minister introduced this innovation, which we all welcomed, we thought that that gave Committees a lot more power. I understand this was the 15th or 16th time a Select Committee had reviewed a candidate and ours was the first where we decided in the negative. Could you explain to the Committee, Secretary of State, what kind of exceptional circumstances could there ever be that a Select Committee recommendation would be accepted if it differed from the Secretary of State?

  Ed Balls: I welcome what you said about the Children's Commissioner post and also Maggie Atkinson. I started my response to you by noting the fact that you had actually praised her high professional standing, and you did so in your report, and I mentioned that in the House of Commons as well.

  Chairman: I am referring to a letter that I had from Dick Caborn.

  Ed Balls: I have not seen a letter from Dick Caborn.

  Chairman: I'll let you have a copy.

  Ed Balls: The difficulty that we had on Monday was not comments made by members of the Select Committee, yourself or myself about Maggie Atkinson. But in the House of Commons in the afternoon, the shadow Education spokesman referred to her as a "Labour establishment choice" and "either pliant or conformist". That was where the difficulty came. The concern that I had over the weekend, when you were releasing your report at midnight on Monday, was that I knew the danger was that other people would choose to make those kind of comments about her standing or political allegiances. That was my concern. But I never thought that was coming from—anyway, on to the point that you raised.

  Q3 Chairman: Can I just mention that it always sounds as though it is a bit mysterious. We always do our release at midnight for the Monday.

  Ed Balls: And that's fine. I think on this particular occasion we had the report on Friday. I had spoken to you on Wednesday. I was studying it over the weekend with our response and your office told us that you were publishing it at midnight on Sunday. The judgment that I had to make was, given that I had to respond, whether I should do so later in the day and allow others to make those kinds of extremely unfair and unwarranted attacks on the Children's Commissioner. That is why I acted in the way that I did and tried to make sure that we were as clear as possible.

  Q4 Chairman: So we are clear what the Committee said and what other people said.

  Ed Balls: I think that it is really important to make that distinction. As I understand it, the Committee quite properly praised her professional standing, but raised some questions. Having raised those questions, you chose to say that you could not endorse. That was your judgment. But you had raised questions that were legitimate and that is a perfectly proper role for the Committee to play. It was others who then referred to her as pliant, complicit or a patsy—all those kinds of things—which was totally unfair. To be honest, the same people also say publicly that they would not be keeping the Children's Commissioner role at all. That tells you part of the agenda that has been going on here, which is nothing to do with me, the Committee or Maggie Atkinson. On the particular issue you raised, I was only aware of the guidance when I was nominating Maggie Atkinson in the last few weeks and therefore writing to you. The guidance was published in August by the Cabinet Office. I presume that this has been discussed between the House officials, Select Committee Chairs or the people who lead for the Government on such matters. I have no knowledge of those discussions, but I am sure that they have taken place. I attached sections 7.1 to 7.3 to the letter to you on Sunday. It explains how Ministers should respond to a report. It mentions "relevant considerations", which would be, for example, "an undisclosed conflict of interest or other information relevant to the candidate's application, which was not declared during the selection process" and "relevant considerations do not include any comments or recommendations of a partisan nature or which are not directly related to the person in question." As you said, there is no suggestion that that has happened in this case. It then says, "In the vast majority of cases where an open and transparent process has been followed and the candidate selected on merit, the expectation is that the Select Committee will agree with the appointment of the Government's preferred candidate. However, there may be occasions where the Select Committee recommends against the appointment of a candidate. In such cases, Ministers should give very careful consideration to the Committee's reports and the reasons why the Committee considers the candidate to be unsuitable." On the issue of the interview, it says, "There may also be occasions where a candidate's performance in front of the Select Committee is considered relevant to the post in question, although this should be exceptional." Presumably, that is an occasion when the candidate appears before the Select Committee and, despite the full selection process which has gone on, exposes something about themselves, their attitude, and their abilities that cast into question the judgment of the independent Nolan process. I presume that is the case. The judgment you had to make and the judgment that I had to make was whether we should overturn that independent process—in this case, on the basis of that evidence. You clearly felt that there were questions. The judgment that I had to make was whether there were sufficient questions in order to reject the unanimous, independent recommendation that I received.

  Q5 Chairman: You did it quite quickly, considering that this woman will not take over until February.

  Ed Balls: But the difficulty that I had—as I explained to you—was that the job for me was to consider carefully your report. I read your report on Friday. I produced over the weekend what I thought was a pretty substantial and thorough response to the Committee. I went through all the points you had made and explained my thinking behind that. Your judgment—which, as you said, is your normal practice—was for this to appear on the news wires at midnight on Sunday night. The Guardian newspaper was also telephoning on Sunday. The judgment that I had to make was whether I waited some hours or days to respond and, in the meantime, allow—as we subsequently saw in the House of Commons that afternoon—people who are badly motivated towards the post of Children's Commissioner or who are trying to play partisan politics with this, to then jump in and say, "She's pliant. She's a conformist. This is Ed Balls trying to rig the process for political reasons." My judgment was that that would be hugely damaging to the post of Children's Commissioner and, to be honest, massively unfair to the candidate in question, who had done no wrong and had only accepted an offer subject to the hearing, following an independent Nolan process. I did not see why I should leave her in that position overnight, which is why I published my letter when I did.

  Q6 Chairman: We understand that. It is good background, but the question really for all Chairs of Select Committees is whether these hearings, for which we had pretty high hopes, are meaningful in that for the very first time—the 15th or 16th has taken place—we make a negative resolution motion and are overruled. Can you see any Secretaries of State using that and listening to Select Committees or is it all a bit of a charade and a sham?

  Ed Balls: First, in your Committee issues were raised about the powers of the Children's Commissioner. Those were good issues to raise in the hearings, although to be honest it was not very fair on the candidate or the selection process to make that an issue for deciding in this instance, because it was about the powers in the 2004 Act. However, those are legitimate issues that came out in the hearings. There were also questions about the UN convention on the rights of the child—Ms Brooke asked some tough questions, and rightly so—but the answers given, as I read from the transcript, were consistent with the approach that we have taken as a country to the UNCRC. But there is a legitimate debate there. It is also the case that if someone has not got the skills, cannot do the job or—as was open to me—is appointed even though they are not the first or unanimous recommendation of the Nolan process, that can emerge during the Committee hearing, or subsequently. I think that there is a really important role for the hearings, but there are some people who clearly felt that they did not like the policy regime. Some people felt that they did not want someone with expertise; they wanted more of a frontperson with more PR experience. To be honest, there are others in the wider debate who do not really believe in the role of a Children's Commissioner at all. Probably it is important that those issues were aired, but I do not think that we should appoint not the best person to be Children's Commissioner because of those wider issues.

  Chairman: Secretary of State, we have loads of other business but, Paul, you wanted a quick one.

  Q7 Paul Holmes: It's on the same question as the Chairman's last one. I asked you on Monday afternoon in Parliament, but obviously that is more knockabout. Here we are supposed to be more in depth and reasoned. It was the question that we have just been discussing. What is the point of pre-appointment hearings if the candidate has already been selected, already been told that they are selected and already handed in their notice to their other employer? The guidance says it would be very exceptional for anything the Select Committee says to have any effect on that decision. It is an experiment. There have been about 14 of these so far, which is about 14 hours of Select Committee time. If in the next 10 years there are 200 or 300, will that be a total waste of Select Committee time if their deliberations have no effect whatsoever?

  Ed Balls: I don't think that these hearings have no effect, although I think that this is a legitimate question for us to debate. There is no doubt in my mind about making the decision to nominate. Under the regime that we have, we make a nomination and then there is a hearing. In making the decision to nominate, of course it is in your mind that this person will have to have a pre-appointment hearing. Perhaps the Permanent Secretary will say something on this, but I had discretion as to whether I accepted the first person, or the unanimous recommendation. I could have, under the rules, gone for someone who would have been lower down the list, but in my mind I am thinking to myself that this person needs to go through the scrutiny of the Committee and I will have to be held to account myself for how we made the decision. So, there is no doubt that it affects you in advance in making your decision as a Minister, the fact that there is going to be a pre-appointment hearing. It is also the case, as the guidance says, that a new conflict of interest may emerge—we know from the American experience that that sometimes happens. That is then a real issue that can sometimes be brought out by this wider scrutiny. And if, exceptionally, they do badly at the Committee then that is another issue as well. However, what we do not have is a system with a veto. It is my responsibility under the 2004 Act to make the appointment. The rules do not say that there is a veto. In fact, they say that even in the exceptional circumstances where you would make a recommendation not to endorse, then you did not reject—you said, not endorse. I had to think about it very hard, and I did. To move to a veto system would move us to a different place. That is a legitimate debate to have. It is not a debate that I was able to have in this instance, because I was working with the rules and guidance that we have got.

  Q8 Chairman: But this power for Select Committees was launched by the Prime Minister as a rejuvenation of parliamentary democracy. It was seen to be a keystone of renewing our parliamentary powers. It seems as though those powers are not really very strong.

  Ed Balls: It wasn't, it isn't and I don't think it was ever described as a veto for the Select Committee over an appointment. It is a legitimate debate as to whether there should be a veto, but that isn't the position that I was in. What I had to do was to justify whether I would overturn the Nolan recommendation, in the full knowledge, as you saw on Sunday and Monday, that this candidate was believed to be the most independent candidate and fiercely supported by the whole of the wider children's world. I would have been in a very difficult position if I overturned the Nolan recommendation. It would have also substantially undermined the Children's Commissioner position, especially when—as we knew subsequently in Parliament and as I knew, because I was aware of what was being said last week and the week before—the main Opposition party are going around telling people that they would not continue with the Children's Commissioner post if they were elected. That is the danger of the Select Committee being drawn into what others use for partisan reasons.

  Chairman: We will draw a line there. Annette wants to put something on the record and then we will move on.

  Q9 Annette Brooke: Secretary of State, I am sure that you will not object to me putting on the record that the Liberal Democrats are absolutely committed to a Children's Commissioner and, in fact, have campaigned for many years to achieve one.

  Ed Balls: And actually would like more powers.

  Annette Brooke: And we would like more powers.

  Ed Balls: It was clear in the 2004 debates, when the Conservatives were not persuaded of the role of the Children's Commissioner.

  Chairman: Secretary of State, draw a line under it. Let us get on with the next business. It is very important business. We will look at the money, which is quite important as you know. As a backdrop, there is no doubt that the figures we have looked at show a very consistent growth in spending: public spending on education, as a percentage of GDP, running through from 1997-98 to 2008-09, starting at 4.6% and rapidly building—steadily moving—at present to 5.8%. We have the backdrop. We have where slightly more money has been spent and slightly less. We know the background reasonably well, but we want to drill down into some of the detail and Andrew is going to start that process.

  Q10 Mr Pelling: It is quite an achievement to increase the percentage of GDP spent on education when there was such strong economic growth. I suspect that with a shrinking economy, the 5.8% might well go up. What is your expectation regarding the current share of GDP on spend on education? What is your expectation of what the percentage of overall public expenditure will be on education? That must obviously come in the context of your discussions with the Treasury on future spending. I know that you have said that 2011 is the year when particular economies are appropriate. What are you arguing about with the Treasury in terms of giving equal priority to schools and children's services?

  Ed Balls: I think it's important to put this in the context of this spending round. The Chairman talked about the change in the percentage of GDP in education. The average spending rise in real terms for education, up to 2007-08, is 5% a year. That compares to 1.44% between 1979 and 1997. In the current spending round, that percentage is lower than 5%; it is 3% between 2007-08 and 2010-11. However, even with that lower rise, the percentage share in education—which as you say is a big achievement—has gone up from slightly below 5% in 1997 to 5.8% in the last financial year. It continues to rise over the next three years to 6.1% as a percentage of GDP, because of that 3% real terms rise, and because of the fact that we have been very clear that we will not cut the education budget this year, next year, or in 2010-11. With this Government there is a clear commitment to keeping that expenditure share rising all the way through to 2011—up to 6.1%.

  Q11 Mr Pelling: How practical is this £2 billion worth of efficiency savings that you have floated?

  Ed Balls: You obviously are jumping then into what happens after 2010-11, where I have been clear the percentage of GDP is rising until then. So, it is not just going up in real terms, it is rising faster than the growth of the economy and rising to 6.1%. The question is what happens in the next spending review. The thing I have said very clearly to the schools world is that we have to start thinking now, as a Government, but also more widely with our colleagues—head teachers, governors, school leaders—about how we will prepare for the spending settlement which we will have to negotiate with the Treasury at some time over the next year and a half from 2011 onwards. I absolutely want to see education rising. I would like to see education spending rising in real terms, but in the tough fiscal regime we are going to be in we are not going to have the 5% real increase that we have seen over the last decade. We are going to be dealing with tougher budgets. The issue will be how to continue to support priorities at the front line—teachers, teaching assistants, one-to-one tuition, school building, extended schools, all of the things that are very important—within a settlement where education spending will rise, I hope in real terms, but not as fast as in the past. The only way to do that is to start a discussion now about the kind of savings we will need to make within overall budgets after 2011, so we can release resources and keep them going to the front line. These decisions will be made in the main by head teachers and governing bodies. This is not about me imposing from the centre that this is what you must do. The right thing is to start this discussion now. I commissioned some independent advice a year ago to help my thinking before we started these discussions. We started discussions with all the teachers' leaders before the summer. The areas where we should definitely look are: procurement; ways in which we can have schools working together which could release resources; school balances; business managers—different ways in which schools by collaborating can drive up standards and release resources. The £2 billion figure is not one I have ever used. What I have done is point to some individual building blocks—which I am happy to discuss in detail if you would like, Mr Chair—around procurement, partnership and school balances. Were you to release those savings in every school across the system, you would be releasing substantial sums of money to keep spending on teachers and teaching assistants when times are tougher. The reason I am cautious about saying, "Here's my number" is because at this point we should be asking schools and governing bodies themselves to think about the kind of savings they can release. It is not about mandating a reduced head count here. It is not about saying, "You must make this saving." It is about saying that if we are going to make sure that in the classroom we keep our 40,000 more teachers and our 110,000 more teaching assistants, we are going to have to work together to remodel the school system so that we can be more efficient.

  Q12 Mr Pelling: The investment in school capital and school buildings has been spectacular. That is partly a reflection of the strength of the economy, I suppose, and also some fairly expensive PFI projects. Can that investment really be expected to carry on? You said in the past that there was an economic value in terms of stimulating the economy by making such spend. Has the Department done any work to prove that it is more stimulative to the economy to build school buildings rather than other public expenditure? Are some of these schemes proving to be cheaper in the current difficult economic environment?

  Ed Balls: I am grateful for your endorsement of what we have done on school buildings. We have had more schools opening this September than, we think, since the Victorian era. That is a huge achievement. To have had 4,000 schools rebuilt or refurbished already in 10 years is brilliant. All of us in our constituencies see the transformation that is having. You also make an important point that school building is only part of what drives school improvement. The thing that makes the biggest difference is what happens in the classroom. The quality of our teachers and head teachers is the most important thing and our biggest achievement, rather than school buildings. You are right that having good, modern, environmentally friendly buildings is important and we have to do that more efficiently. The Building Schools for the Future programme, compared to the previous regime of more individual procurement and some of the early PFIs, is releasing substantial savings in the procurement process. We are seeing 10 to 15% savings in procurement. One of the things I said on the wider efficiency point is that at the moment, given that schools in general are procuring about £7.8 billion of services every year, if you could achieve that 10% saving in wider procurement that we have already shown we can do through BSF, that is £780 million. That is getting quite a long way to the number you were talking about, just within procurement alone. Of course, we have to try to be more efficient. In the next spending review there are going to be some tough discussions. We have a commitment to rebuild or refurbish all secondary schools and half of primary schools over the next decade and I am keen to keep making progress. I know there are many local authorities around the country keen to get into BSF wave seven and eight. I know there are probably many of your colleagues who are in waves seven, eight and nine who are hoping that the schools capital will keep rising and that it is not going to be diverted to fancy schemes here, there and everywhere or cut.

  Q13 Chairman: Isn't the Chancellor saying that public sector capital spending is going to fall by £50 billion between 2011-12 and 2013-14? So are you going to be free from the Chancellor's predictions?

  Ed Balls: The Chancellor set out a deficit reduction plan, and tax plans and spending plans. As we all know, those plans are continuously looked at in the light of what happens to the economy, and some tough discussions are going to be had about where the priorities are for capital spending for the future. It is not appropriate for me to pre-empt them. All I can say is that I want us to keep moving forward on our school building programme because it is vital for the future of our country. We as a Government—not all share this view—think that to continue to invest is important for growth and jobs, and in the past couple of years school building has been a vital support for the economy through the downturn. I think that it will be a vital driver of the economy, but also an investment in our children's education for the future, but we will have to wait and see.

  Q14 Mr Pelling: I have some micro-questions about this year's and next year's budgets. There was a slight shift towards the under-fives within the budget. As a former chairman of an education committee, I know that there is always tension between different parts of services. Is that trend going to continue? Will any particular priority be given to the different sectors going forward? Is there going to be any overspend or underspend in this year's budget—and if there is an underspend, will it end up being transferred to the Treasury?

  Ed Balls: On the first point about the trends, I was looking at these numbers because I was interested in your question and wanted to find out the facts for myself. You are right: over the past decade there has been a small upward trend in under-fives spending. Under-fives spending was 9.6% of overall expenditure in 1997-98, and rose to 10.5% in the 2006-07 out-turn, which is the last point for which I can break down those numbers. That probably reflects Sure Start children's centres and the free nursery care for three and four-year olds, and the fact that within the overall rising budget we have really prioritised a big expansion of under-fives provision. We now have 3,000 children's centres; we have a high take-up of nursery care for three and four-year-olds and are extending that to two-year-olds. Will that trend continue? Probably. While we will keep the focus on the under-fives in the coming years, the big trend over the next five, six, seven years will be the rise in participation of 16 and 17-year-olds as we deliver education for all 18-year-olds by 2013. One example—we haven't discussed this before the Committee and I am happy to do so—is that we had an issue in the budget with delivering our guarantee for every school leaver this September. We found £650 million of savings across our budget and switched that money into paying for 55,000 more places for 16 and 17-year-olds this September. I anticipate that in each of the next few years we will need to have more school places—probably more college places, more importantly—more training places for 16 and 17-year-olds and about 50,000 more apprenticeship starts. If the trend in the past 10 years was with the under-fives, I would think that an important trend would be with 16, 17 and 18-year-olds over the next four or five years. We have made a down payment on that—without cross-party support as yet, despite 11 letters to my opposite number. But I have not given up hope yet.

  David Bell: As the accounting officer, I have to ensure that we keep within our budget, and if you look at the trend over the past few years we have got our underspend right down. Last year it was 1.09%. Just to put that in context, it often feels to me as if we are trying to land a jumbo jet on a sixpence, given the size and scale of our budget. So, we have to keep a really close eye on it during the financial year. I think that we have got better. Five years ago perhaps, when our underspend was nearly 5%, whether we were doing our financial forecasting properly was a legitimate concern. We are trying to get that more and more accurate. Quite properly, all the incentives are to stay on the right side of the line, because even a penny overspent would require a qualification of our accounts, and I certainly do not want that to happen.

  Chairman: Can we move on to Paul, who is going to drill down on efficiency savings.

  Q15  Paul Holmes: Before doing that, may I ask a precise question that does not really fit anywhere, although it probably fits best at the end of the first section. Last week, we took evidence on home education relating to the Badman report and we were told that before January your Department was going to clarify its advice to local authorities about claiming pupil funding to make it clear that that includes money that could be used for home education. People who home educate could apply to the local authorities to access this money. Home educators tell us that almost uniformly across the country local authorities say that there is no such money, but your Department seemed to be saying that there is. Is that new money that will be made available from January or is it money that is already there that local authorities have not made available?

  Ed Balls: Local authorities have a responsibility to provide support for children with special educational needs. That responsibility applies to all children. In some cases, children are home educated because parents have had difficult experiences with schools—sometimes because of bullying, sometimes because they could not get the place they wanted, but sometimes because they did not feel that the special educational needs of their child were being properly addressed in that school setting. Point one is that local authorities should be making sure that they are addressing those concerns for parents who want to keep their child in school, but in no sense should a child being home educated take away the responsibility of the local authority to meet the statement of special educational needs of a child. So, I think I am right in saying that this is the local authorities' responsibility. They should be doing it and I really encourage home educators to take up those offers or to press for that support because a child with special educational needs requires special and sometimes professional support.

  Q16 Paul Holmes: So the money is already there but it is the SEN budget that we are talking about. Some of these children have been bullied at school, have dyslexia, or have a special educational need of some kind, but equally there are plenty of children who are home educated not because of SEN but because they or their parents have chosen not to use mainstream schools. Can they access any money for exam fees? It can cost £1,000 to enter for GCSEs, for example.

  Ed Balls: The announcement that the schools Minister Diana Johnson made before appearing before your Committee last week was precisely that we would be providing that extra financial support for exam fees, and wider support if home educators chose to take it up. I fully support the right of home educators to educate their children at home if they choose. I know that not everybody supports that right, but I support it if that is what they choose. But it is really important that children who are home educated are getting the help they need, and sometimes the extra support for a special need or to do exams. There is also—this is unpopular with some home educators—a balance to be struck between the rights of the parent, which I support, and the rights of the child. Our responsibility is to make sure that they are safe and making progress. Following the Badman review, I think we are getting that balance right. Some educators disagree because they do not think that there is a responsibility of wider society to make sure that children are learning and safe. On that point I disagree with them.

  Q17 Paul Holmes: Just to clarify that, home educators should be able to access the SEN budget that already exists where relevant and new money will be made available to cover exam fees and that sort of thing, or is it money that is already there?

  Ed Balls: The announcement that Diana Johnson made to the Committee a week ago was that we would provide extra support not just for children with special educational needs but where exam fees were a barrier. I do not have the exact details of her announcement.

  Chairman: We are slightly off piste but we are getting him back on to public expenditure.

  Ed Balls: I am hoping it will be welcomed by home educators around the country. That is an optimistic hope.

  Q18 Paul Holmes: On efficiency savings, what is the exact figure that the Department is looking at for efficiency savings in 2009-10? How does that split as a proportion between education and children's services?

  Ed Balls: The efficiency savings for 2008 to 2011 were all agreed in the last spending review. On the basis of my figures, for 2009-10 we have a total of £209 million of efficiency savings. That splits between savings on demography, the 1% a year savings in the overall DSG settlement and some smaller savings as well. The bulk of it is happening through 1% efficiency savings in schools, because obviously that is the bulk of our overall budget, but within that there is also a 5% expectation for efficiency savings from non-departmental bodies as well, so there are savings across our agencies too. Obviously, schools are the bigger part of our budget, so they make the biggest savings, but I think that it is fair right across our budget lines.

  Q19 Paul Holmes: So it should be in proportion—children's social services, education—to what the balance of spending is anyway?

  David Bell: Absolutely. We had to agree with the Treasury, under the spending review for 2007, on how that would be broken down. I am more than happy to make that available to you because it is just, in a sense, a line-by-line breakdown.[1] The key issue for us, of course, is to achieve those savings over the spending review period. You might recall that in previous appearances we have had some time-lag difficulties. We cannot necessarily clock the saving because it has to be recorded out in the school system. That is all broken down over the three-year period. You are absolutely right; it is broken down across all of our responsibilities. As the Secretary of State said, largely, the big numbers have to be around the school side because that is a very large proportion of our budget.

  Ed Balls: For example, there is a confirmed saving in 2008-09 from the QCA of £4.5 million, £1.5 million from the NCSL and £600,000 from CAFCASS, and even £83,000 from 11 Million, so our NDPBs are also delivering savings consistent with that 5% efficiency target. There was another thing that I was interested to know and thought that I would let the Committee know. I looked up our departmental headcount, and the total full-time equivalent DCSF posts under the old regime in 2002-03 was 4,300 posts. As of this year, April 2009, it is down from 4,300 to 2,700, and by April 2011 we expect to have reduced our full-time headcount to 2,484, so we will be at around half the staffing level that we were at.

  Q20 Paul Holmes: How far is that offset by consultants and by almost fully funding the Specialist Schools and Academies Trust, which is supposed to be a charitable body but is about 90% funded by the Department?

  Ed Balls: Look, there are times when we use consultants in the DCSF but I think that those headcount numbers have real significance.

  David Bell: If you recall, under the 2004 spending review there was a direct headcount target for the Department, which we exceeded. Under the SR07, there is not a direct headcount target, although the numbers have been going down, but there is, crucially, a 5% year-on-year administration reduction target, which is part of the spending review agreement. As the Secretary of State said, the numbers have gone down. That even takes account of the fact that we lost some of the staff under the machinery of government transfers, so even when you take account of that, our numbers have gone down quite dramatically since the beginning of the century.

  Q21 Paul Holmes: But if you give about £300 million—from memory, I think that is what it is—to the Specialist Schools and Academies Trust so that it can employ whole teams of advisers for schools, is that not just a way of shifting your figures and pretending that you have lost staff?

  Ed Balls: I do not think that the numbers that I have given you reflect, in the main, shifts of the same people being employed under different auspices, but, yes, we fund the SSAT to do some important work in schools. We fund the National Strategies to do that as well. I do not think that we have been doing more of that and I think that in central administration terms we have been doing less.

  David Bell: I can confirm that those efficiency savings that the Secretary of State referred to on the NDPBs will include staff reductions, so, in a sense, everyone is having to take the pain when it comes to staff reductions.

  Q22 Paul Holmes: One specific piece of commentary from the Department was that, in terms of making efficiency savings in the next year or two, economies of scale arising from the growth of post-16 learner numbers over the next two years will mean that learner places can be delivered with greater efficiency after this year. Sixth-form colleges, which are in the FE sector for funding, are less well funded than sixth-form places in schools, but they get better overall A-level point scores, for example. However, certainly until a few years ago, the Government had a policy that any school that wanted to open a sixth form should be encouraged to do so. How do we balance those conflicting policies?

  Ed Balls: It is also our policy over time to narrow that funding difference, and it is important that we continue to try to do that. That is always tougher where there are tougher budgets. We had a decision to make at the time of the Budget about efficiency savings. As I was saying earlier, we had to find what we estimated to be about 55,000 more places for 2009-10 and 2010-11 for school and college apprenticeships. On top of the spending review, we found what we thought was a deliverable extra £650 million of savings, which we could then use to pay for those extra school and college places. Within that £650 million, there is a 1% extra efficiency expectation that goes right across schools, sixth forms and FE colleges. In general, across the piece we are saying that in order to provide more places, we will have to find ways in which we can do that with slightly less per pupil funding. To be honest, that is the only way to deliver on the scale of the guarantee. It is tough, but necessary. As I said, I am hoping that at some point the Conservative party will support those proposals. I have written to Michael Gove 10 times and he still won't reply. I will keep writing.

  Q23 Mr Stuart: What?

  Ed Balls: It's 11 times.

  Mr Stuart: That's what you said five minutes ago.

  Ed Balls: I am very happy to make it 12 times.

  Chairman: Graham, I will call you in a minute. Paul.

  Q24 Paul Holmes: On 20 September, you said that your Department could make £2 billion of savings to help meet the national deficit. You gave a specific example of schools federating and having one super-head, for example. At the moment, if four schools get together and have one super-head, they keep the money that they are saving. It is within the school budget. Are you suggesting that in future, if schools federate and have one head and fewer deputy heads, you will get the money rather than the school keeping it in its budget? In which case, what is the incentive for the schools to federate?

  Ed Balls: I am not mandating that a school must have a particular form of school organisation and give us the money. That is not what I am saying. There are some areas where there will be decisions that we will have to take together. For example, there will be decisions to be made about public sector pay. This year, I am supporting the three-year pay deal for the pay review bodies, but there will be a question about pay for the future. In the case of procurement, schools cannot individually release the scale of savings that we are talking about. We will have to think about how collectively we can deliver the procurement savings. On the issue of school balances, we think that there is about £500 million of excessive school balances, and there is a real question for local authorities as to what they do about that. I am afraid that leaving that individually to schools will not reduce those balances. On the issue of federations, we are not saying, "You must federate or work together", and we are not saying, "You must do so for savings reasons." We are not saying that we will take the money away. However, some work has been published today by the National College. Federations work because they raise standards. That is the first and most important reason for having them. Schools that work together collaborate in soft or hard federations. That raises the exam results for all the schools, and that includes a stronger school supporting a weaker school. That is a reason to do this, and we said that very clearly in the White Paper. It is also the case that schools that are doing this find that as well as making leadership go further forward in driving standards, they can also find economies. I gave two examples in September. One was a Northumberland partnership between five schools. They had managed to save what averaged out to be about £20,000 per year per school from collective procurement of caretaking, ground maintenance, cleaning and refuse collection. At the time, I said that were we to replicate those kinds of savings across a third of our schools from collective working on those services, that would get about £160 million. If all schools did it, it would be £500 million a year. I also talked about a partnership in Cambridge where there were three schools hard-federating—two secondaries and one primary. It is perfectly consistent to say that they are doing this for school standards reasons. Each school can have a head teacher, but across the partnership the leadership team can be shared. You could have subject heads that work across the schools, or SENCOs or assistant heads that play a role in more than one school. So, where you have three large leadership teams, you can bring them together and have some roles that work across more than one school. I think that that is an area where we could look to drive great leadership, but also, over time, make savings and keep our teaching and teaching assistant numbers at the front line. What I am not saying is that I am going to mandate that and that I am going to take the money away. What I am saying is that within tougher budgets—I hope they will still be rising, but they will be tougher—what does a school leader do? They are not going to have to give the money to me, but they are going to get a smaller increase than they are used to. So they either lay off the teachers and the teaching assistants, or they find other ways to reduce some of their other costs so that they can themselves switch money across, as I have done with the £650 million from efficiency into 55,000 more school places. What I want to do is support school leaders to face up to some of the tough choices that they will have to make. I am not saying that I am going to mandate.

  Q25 Paul Holmes: So you are going to push schools into federating and reduce the number of heads and senior staff because you want to cut the budgets and that would be the only way of covering the deficit?

  Ed Balls: That is a rather pejorative way of putting it.

  Paul Holmes: That is what you have just said effectively.

  Ed Balls: I think—I said this in September—that every school needs a head.

  Q26 Paul Holmes: So not a federation then?

  Ed Balls: No, because it is perfectly consistent to have a head in each school or to have an executive head. If you are following that model, you would have two heads, but, as you know, schools have head teachers, deputy heads and assistant heads, so they have quite a depth to their leadership teams. The question is: do you need to duplicate all of that depth of leadership across each individual school, or are there ways in which you can have leaders playing a role across more than one school? It is really important to say that today's National College report—I didn't know that it was going to produce it today, but it has—

  Q27 Chairman: I thought that it was School Leadership?

  Ed Balls: I think that we are supposed to call it the National College now, because it is the National College for Leadership of Schools and Children's Services. The report states that the primary reason for doing this is because it raises standards. I have not met anybody in a federation who is not doing it because it is a better way to deliver a broader, more effective education for their children. But I have also not met anybody who has gone through a federation who does not also say, "By us working together, we can actually do that more efficiently as well." I think that both those things are quite consistent, and that it is wrong to say that this is simply a cuts exercise to damage, reduce or undermine leadership. To be honest, federating is what great leaders do.

  Q28 Paul Holmes: Would you have said it if there was a big example of saving £2 billion?

  Ed Balls: I didn't say £2 billion. What I said was that we have examples of schools themselves saving money and driving up standards. If schools together across the system do that, which I think they should, they will be able to release savings for the front line, as well as drive up standards. I think we have to face up to the reality and start having some difficult conversations, but the big choice is going to be whether you release savings within rising school budgets after 2011, or whether you start cutting school budgets next year and the following year. That is the big political choice we will face at the next election.

  Chairman: Okay. It has been a very good relationship between you two, but I have to break it up only because we are running behind time.

  Q29 Mr Chaytor: The Secretary of State said earlier that the rise in school funding will continue until 2010-11 and that it will be 6.1% in 2010-11. Table 8.3 in chapter 8 of the departmental report shows the figures for total education spending up until 2010-11, and shows a year-on-year reduction of 0.3% How do you reconcile your assurance that school spending will rise by 6.1% in 2010-11 with the overall reduction of 0.3% indicated in the departmental report?

  Ed Balls: By clearing up the misconception that underpins the position of those who have tried to use this as an attack. What happened was that we made a decision at the time of last year's Budget. We knew we had to do more to support the economy in the downturn, so we brought £800 million for planned spending for 2010-11 forward and said to local authorities around the country, "We will give you the permission, ability and freedom to bring £800 million forward from 2010-11 and spend it a year earlier." If you say that the average contract involved—for example, in primary or secondary capital, for the kind of money that we are talking about—might be £250,000 for a new roof or a new sports hall, £2 million brought forward would mean about eight contracts of a substantial size for local small businesses in the downturn, and at a time when there are fewer private contracts being let. I challenge local authorities around the country to bring forward money in that way. I am pleased to say that the large majority of local authorities did so, although some—certainly fewer than 40—refused to bring forward money. Of that 40, almost all were Conservative, which disappointed me. But bringing that money forward from 2010-11 to 2009-10 will of course mean that the 2009-10 budget becomes bigger and the 2010-11 budget gets a little bit smaller. Therefore, it looks like a fall. But it is the same money being spent over two years; we are just spending it a year earlier to try to help small businesses in the downturn.

  Q30 Mr Chaytor: Was the departmental report not published before the year?

  Ed Balls: No. June 2009.

  Q31 Mr Chaytor: So the figures in the departmental report absolutely reflect the consequences of those changes?

  Ed Balls: Absolutely.

  Q32  Mr Chaytor: Do the figures in the departmental report only reflect the consequences of those changes?

  David Bell: I will just have to check the timing of that. Obviously, the tables for the reports are pulled together before the final publication, but I am happy to clarify that.[2] But the explanation is what the Secretary of State has given.

  Ed Balls: It states here that "total expenditure figures are projections based on the information at the time of the Budget 2009." As I understand it, that reflects a bringing forward of money.

  Q33 Mr Chaytor: There are two separate issues. First, does the table reflect absolutely the decisions on the re-phasing from 2010-11 to 2009-10? Secondly, does the figure here only reflect that, or is there some other changed plan for 2010-11 that is reflected here as well? Clearly, if schools spending is predicted to go up by 6.1%, what are the predictions for non-schools spending? The table includes figures for DIUS, so we cannot speak about that necessarily here. But my next question, therefore, is: what are the implications for non-schools spending in 2010-11, after taking account of the 12-month bringing forward of the figures that you mentioned?

  Ed Balls: If you take the year-on-year real-terms rises, 2007-08 was a 4.7% real-terms rise, 2008-09 was a 3.9% real-terms rise, and 2009-10 is 5.8%—an almost 6% year-on-year rise in 2009-10 over 2008-09. Within an overall settlement, which is 3%, in 2009-10, you have a real-terms rise year-on-year of 6%. The reason for that big jump in 2009-10 is that, rather than going for £66 billion in 2008-09, £69 billion in 2009-10 and £72 billion in 2010-11, we brought forward the total amount of money from 2010-11 into 2009-10. That is why the profile ends up being 3.9%, 5.8% and then -0.3%—it is simply spending the same money a year earlier. There may be some other things going on, but to be honest, the extra £650 million of expenditure for school, college and sixth-form places will probably be reflected in there as well. I would think that that number should be in there, too.

  David Bell: I can answer my own question about what the tables include. If you look at the top of page 174, the text states: "Table 8.3 shows that DCSF's planned expenditure has been affected by the advancement", which the text goes on to explain.

  Q34 Mr Chaytor: What is the consequence, therefore, for the original targets of efficiency savings for 2009-10? As the Permanent Secretary had said in the two previous sessions on departmental reports, there were some doubts whether the Department has met its efficiency savings targets. My understanding is that the original target for 2008-09 was £1.6 billion, and by the end of that period, only £200-plus million had been identified, because of the phasing problems that he mentioned before. But by the end of 2009-10, a total of £2.9 billion had to be achieved. Will the Department make that saving of £2.9 billion by the end of 2009-10, or has that been affected by the bringing forward of spending from 2010-11?

  David Bell: Let me just take the two parts of your question. I think, when I expressed some concern about the previous spending review efficiencies, it was entirely to do with the time-lag issue. We had a target of £4.3 billion in the last spending review and actually met £4.88 billion of efficiencies, and met all the other targets. As I indicated to Mr Holmes earlier, we have a very detailed breakdown of the spending efficiencies we have to make in this period and, yes, the milestones along the way assume certain savings being made in each of the years of the spending review. I think that we are still pretty confident that we'll achieve where we need to be by the end of this financial year, but I think my point is that I can't give an absolute sign-off on that, often, until about six months later, because of the data that come back from the schools system that we can't get at the end of the year. But I'm pretty confident, because we've really got this one under close scrutiny. Whether the impact of the bring-forward will make much difference: probably not, because actually most of the savings that we're assuming within the efficiencies programme are revenue savings, rather than capital additions.

  Ed Balls: Just to clarify, so we don't have to send you the detail, it actually says in the departmental report that capital investment will rise from £1 billion in 1997-98 to £5.8 billion in 2010-11, while £6.5 billion—so, higher than £5.8 billion—will be spent in 2009-10, following the advancement of a number of programmes to support the Government's fiscal stimulus to the wider economy. So that advancement of resource from 2010-11 into 2009-10, I think, is explained in that profile.

  Q35 Mr Chaytor: Presumably, it still does mean that, in 2010-11, there will have to be some additional reduction elsewhere to compensate for the fact that the budget has been brought forward to 2009-10. It's not going to be in schools, because you've committed to maintaining a 6.1% increase in schools. Where is it going to come from in 2010-11?

  Ed Balls: This is basically the primary capital programme and other capital spending programmes, so this is money which they were planning to spend in 2010-11, and they'll spend less in 2010-11 than they were planning, because they're going to spend more in 2009-10. What you're getting at is a deeper issue, which is that this is obviously important for the base line going forward; but in terms of the actual number of teachers employed, or buildings built in 2009-10 or 2010-11, there won't be any change; it's just that there's going to be a little bit of it done earlier.

  Q36 Mr Chaytor: And in terms of revenue spend for 2010-11?

  Ed Balls: Well, the £650 million of efficiency savings that I announced in the Budget, that is revenue efficiency savings; all of that is going back into the school and college system to pay for 55,000 more places. By the end of the day, I'll have written to Michael Gove about for the 12th time, following Mr Stuart's helpful prompt. But that's revenue, whereas the bringing forward of 2010-11 to 2009-10 is mainly capital spending—almost entirely capital spending.

  Q37 Mr Chaytor: Just one final thing: Secretary of State, you said earlier that, in the first five years of the next decade, the focus may well have to switch from under-fives to over-16s, with the policy on increasing the participation rate up to 18. Isn't a common funding formula from 14 to 19 the obvious way to make the kind of savings that you're going to need?

  Ed Balls: I didn't quite say what you said, Mr Chaytor. What I said was that, in the past 10 years, there had been a big rise in the share—well, a rise anyway—because of three and four-year-olds' nursery care, and Sure Start, and we obviously want to lock in, and go further if we can, on three and four-year-olds. We are trying to extend free nursery care to two-year-olds. We'll have 3,500 children's centres from next year, and we're looking, over time, to get more graduate-trained people into early years.

  So the focus will continue, but in terms of number of places we have a big challenge to produce a lot of extra places for school and college apprenticeships by 2013 to 2015. I wouldn't want it to be seen as a downgrading of under-fives at all. But I think there's going to be a new focus for raising the participation rate by about 10 percentage points for over-16s. And a common funding formula for 14 to 19 is not currently on our agenda, and we said that in the White Paper clearly around our discussions for the school funding review for the autumn. But at the same time, there is clearly a case for it, and it's something which we'll continue to think hard about as we introduce the Young People's Learning Agency and increase collaboration across the schools and colleges sector, to deliver new qualifications; the case will grow.

  Chairman: We are up against it; so quicker questions and answers.

  Q38 Mr Stuart: Secretary of State, can you clarify the £2 billion reduction? You seemed to deny that a little earlier. Can you tell us what you did say about that?

  Ed Balls: I think that I answered the question before you arrived, Mr Stuart.

  Q39 Mr Stuart: Okay. Moving on then, within the context of efficiency savings, children who are falling behind will have an entitlement to one-to-one support. I am wondering, given the fact that class sizes have barely reduced in the past 12 years, how is one-to-one tuition going to be paid for. Can you tell us how much will be spent and where we will be able to identify that money within the system?

  Ed Balls: In 1996-97, there were around 30% of children in Key Stage 1—five, six and seven-year-olds—being taught in classes over 30. That number has come down from 30% to about 1.3%. So there's been a huge fall.

  Mr Stuart: The average has reduced very little.

  Ed Balls: There has been a big fall in class sizes for five, six and seven-year-olds, which was our policy. There has been a fall in class sizes generally. You have a choice to make—haven't you?—in terms of how you use your resources. Do you say that you'll have one adult in the class with a smaller class size? Or do you, as we have done, have a class size—which has come down and could have come down more—with a teacher and often two teaching assistants in the class, supporting children with special needs or behavioural issues or just with extra learning, so that the class can keep learning? The 40,000 extra teachers and 110,000 extra teaching assistants could have been used, if heads wanted smaller class sizes.

  Q40 Mr Stuart: Secretary of State, could you answer the particular question about one-to-one support? What money is being provided?

  Chairman: I assume this is the second part of this. Could you hold that. We can get to the White Paper when we get through this first section. Graham, I will call you as soon as we get on that topic. Annette.

  Q41 Annette Brooke: I start by declaring an interest. I want to ask about the reform of the formula for school funding, and the two authorities that I represent are both in the bottom 40, both Conservative—one campaigning really hard, the other one not even bothering to supply evidence to you or to pay the subscription to the F40. I want to know, is the Department committed to a full reform? Are you going to go with it this time?

  Ed Balls: I am also an MP representing a constituency in the bottom 40. I spoke at the F40 conference earlier in the year by video link, rather than in person. It was held in my constituency. I don't know whether it was by chance that they happened to hold the conference there or whether someone decided it might be good idea. It would be fair to say that this is something on which my mind is regularly focused. We will make sure that the school funding review is good and thorough. The work is still going on. We set out important principles in the White Paper which are going to guide our approach to the review when it comes out, in particular around the way in which we allocate resources for deprivation to make sure that the money is getting through and that the proportion of deprivation funding grows within the overall total. Obviously, the current funding formula and the fact that it is based on the 2005-06 spend—because we have a spend-plus system—means that we have traded stability and predictability on the one hand for some authorities feeling that it is not as fair to them as it should be. The issue is how to get the balance between a proper focus on deprivation, which is really important; a proper focus on the extra costs where you have rural schools, for example, and, within that context, how to ensure stability and predictability that is also fair. We are thinking hard about this, as we prepare for the funding review.

  Q42 Annette Brooke: Can I just ask you directly. Obviously, if there is a change there will be gainers and losers. I suppose my question again is: are you going to go ahead with the recommendations? If you introduce floors and ceilings, the problem will never be addressed properly.

  Ed Balls: As I said, you are completely right in challenging me. I would say that there is a balance to be struck between stability on the one hand and a proper focus on need in a fair way on the other. It is easy to draw up a formula; it is very hard to get consensus, but even if you have consensus, it could be very jarring and destabilising along the way. We have to make sure that we get this right. I have not seen recommendations yet from the review. We are expecting to get those later in the year. We will obviously need to have a very full and substantial consultation on any proposals we have for the future. I do not want to pre-empt its outcome. You are right to challenge me, but it is quite hard.

  Q43 Annette Brooke: Can I just ask you specifically about this. You mentioned deprivation and rural areas, and we probably should also put special needs into the pot as something that definitely needs addressing. Does the report look into the area cost adjustment, which has peculiar boundaries from my perspective?

  Ed Balls: I understand. I do not think that we have ruled out anything we have looked at. So I will wait to see the report.

  David Bell: I can confirm that one of the major areas that we have asked the review to consider, along with some technical advice, is area cost adjustments.

  Chairman: Thank you, Annette. We have been through this before when Charles Clarke was sitting there. There is a feeling of deja vu. We will expect blood on the floor in future.

  Ed Balls: Maybe that is why the police are outside. There has been no blood on the floor this morning, Chairman.

  Q44 Helen Southworth: The detailed breakdown of expenditure by function gives far more detail for the education part of the Department's responsibilities than it does for the other aspects of the Department's duties. In particular, there does not appear to be anything in there that is a congregated children's services line. It is extremely hard to identify what growth there is, what savings there are and what actually is happening.

  Ed Balls: Chairman, Miss Southworth is known for her forensic approach to challenging policy. That is why she often succeeds in her campaigns. She is a new member of your Committee, and she exposes a real gap in our knowledge and information. We will make a commitment today that next year's departmental report will substantially improve the data that we can provide on this. It is a very fair point. We have policy responsibility for children's social care, which transferred in the past. The data in the past were collected by the Department of Health, and we have some budget data from what is called the section 52 return, but it is not very good information. We do not think that it is reliable, and we ought to be able to do better. So we will provide much better information in next year's departmental report. If we can provide that data more quickly, we will do so.

  Helen Southworth: If we can get an update, that will be very good indeed.[3]

  Ed Balls: As I said, this is my first point where I am totally on the defensive.

  David Bell: This is partly a result of the funding for children's social services going through the local government settlement. Of course there are particular responsibilities that fall on departments in the accounting terms for the departmental report. One of the things that I will do as a result of this query is raise the question with the Treasury and my counterparts to see whether we can ensure that we get a proper report within our annual report. That is the funding that is going out through our budget line, as opposed to some of the children's social services lines. I cannot imagine that my colleagues in the Treasury would be opposed to this, even if it was replicated information that appeared in another departmental report. These functions fall on us as a lead Government Department, but the funding goes out through a different funding stream.

  Ed Balls: The problem is that we know there has been a 6.1% real-terms annual rise in children's social care. It is up by about 90%, but we do not really know where that money is being spent in a more detailed and finer breakdown. We should, so we will.

  Q45 Chairman: But is it not our job to scrutinise taxpayers' spend, and this is a really big issue?

  Ed Balls: You have asked me a tough question, and I have told you that I cannot answer that today.

  Chairman: I don't think we can wait for a year. You are going to have to come back earlier.

  Ed Balls: The commitment I made was that we would definitely do it by next year's departmental report, but the sooner we can do it, the better. That depends upon how we can get the information collected. But, look, I have the same reaction as you. I want to know and I want to know the detail. It is not really good enough, and we will improve it quickly.[4]

  Helen Southworth: I was going to go on and ask a series of questions about how that was going to be improved and what was going to be done, but we are going to come back and have another look at that.

  Mr Stuart: Perhaps she should write to Mr Gove as well.

  Q46 Helen Southworth: There is something specific that I wanted to ask the Minister about, because during the summer, I have been receiving a lot of representations from young people in care. I have undertaken to bring two specific issues to you, to ask you on behalf of young people who are approaching leaving care, or who are just leaving care, who want to have the opportunity to stay with a foster parent or to have good support and who are not currently able to. They are not happy. They want to ask, like any young person in that situation would, their parent for support, and we are their corporate parent, so I really want to ask the Secretary of State whether he can take up that issue personally and make sure something happens quickly for those young people.

  Ed Balls: In my own constituency, the leaving care advisory service for 16 to 24-year-olds is run by Barnardo's. I have met them a number of times. I know the challenges that are faced, and these young people deserve better and longer support from us. I think that we have substantially improved the way in which we are supporting young people going to university now, but there is more that we can do. Hopefully, the legislation, which has just been taken through the House in the past year or so by the previous Children's Minister, Beverley Hughes, improves the legislative framework and the expectations on local authorities. But the key thing is to make sure that translates into change for young people on the ground. Maybe the right thing to do, Chairman, would be for me to have a meeting with Miss Southworth as part of her Committee work, and then she can report back to you once we have had those discussions.

  Helen Southworth: I have one additional question.

  Chairman: Very briefly.

  Q47 Helen Southworth: Minimum standards of accommodation are something that this Committee has taken up and taken to the Minister. The young people during the summer were saying they need them now. Can they have them now?

  Ed Balls: As I said, the responsibility for the delivery of those services is for local authorities, but we have to make sure that they are resourced and challenged and expected to deliver those standards of care, and that is about the quality of the buildings and also the training of staff. We place huge responsibilities and expectations on care workers working with looked-after children going through probably the most turbulent time of their lives. I am not sure that we always do that with the high enough expectations of what we should be doing in terms of training and support for those care workers, and that is one part of the wider question of children's social work, which a social work taskforce is looking at. I am very happy to make sure that that particular issue is being addressed as part of the social work taskforce. But, as I said, we place very high expectations on some of the care workers and so do the kids in their care.

  Q48 Lynda Waltho: Secretary of State, I want to look at the objectives in the public service agreements and targets. Despite efforts to reduce the number of performance-driven objectives and the PSAs, a number remain in place and, indeed, it would appear that several new ones have appeared. How does your Department work, in conjunction with the other departments—for instance, the Department of Health—to ensure consistent delivery? And if that delivery does not occur or is not consistent, who takes the rap for that?

  Ed Balls: I think that it was very brave of the Government back in 1998 to commit to publishing and being made accountable for public service and output targets—the original PSAs. There is no doubt that to begin with we had too many. Sometimes, we hadn't understood how to deliver this. It had never been done before. There had never been in the British Government in the previous years any focus on outputs for public services at all. I think that we now have a really good set of sometimes individual but often shared objectives. I would not want to see a reduction in the number of PSA targets for our Department. I think that would be the wrong thing to do. And you're right that, in order to deliver many of them, they have to be for more than one Department. Teenage pregnancies are a very good example. What's happening in schools and what's happening in the health service are both absolutely vital, and obviously leadership of the local government is as well. You can explain that for many of the other ones as well. In many cases, we now have direct joint policy responsibility. For example, in the case of children's health, I have joint responsibility with Andy Burnham. In the case of youth justice, the Youth Justice Board and youth custody are jointly sponsored by myself and Jack Straw. So I feel as though I have responsibility and accountability for some PSAs, which, traditionally, you would have seen as health. When it comes to healthy eating in schools, obviously, that depends very much on the wider active work being led by the Health Department. A Cabinet Committee meets every quarter—I think that I am right in saying that—and we look at all these PSAs. Ministers turn up. Where we are worried, we then get officials together to report back to us on whether or not there is sufficient joint work and joint challenge. As we've discussed before, there is a question for Parliament as to how it chooses to scrutinise where there is joint responsibility. I think that you've led the way, Chairman, in the way in which you scrutinise the child poverty objective, which is a joint PSA, but there are other PSAs which are equally deserving of scrutiny and where there is one more than one departmental responsibility for delivering them.

  Q49 Lynda Waltho: Do you know of any PSAs that have been dropped from the Department in 2009-10?

  Ed Balls: No.

  David Bell: No, the original structure of PSAs that was agreed at SR07 allocated PSAs 10 to 14 to us, and that still remains the case. To deal with the additional point to the Secretary of State, each PSA has a management board involving the relevant Departments. I chair an oversight board, which essentially reports into the ministerial committee that the Secretary of State has described.

  Q50 Chairman: Culture, Media and Sport is an unusual one, but you do have some joint responsibilities there—I am thinking of obesity. Do you think Ben Bradshaw's idea of freeing up product placement on commercial television would be good for child obesity and child health?

  Ed Balls: We have, with DCMS, joint responsibility for children's play, but we certainly make sure that our voice is heard on any issue which is about children and young people. On the particular issue of product placement, I think that we need to proceed with great care.

  Chairman: Thanks for that. We are moving on to the second session. David Bell is leaving us. Thank you, David. It was nice to see you again. Vernon Coaker and Jon Coles are joining us.

  Ed Balls: The Permanent Secretary has just said to me that this is the fist time that we have had a meeting without his wearing a jacket. He has managed to survive.

  Chairman: He is breaking new ground. He will turn up not wearing a tie next.

1   See Ev 17. Back

2   See Q33. Back

3   See Ev 17. Back

4   See Ev 17. Back

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