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Lord Sewel: I accept that the Government, in going down the road of vouchers, believe that it will increase provision and increase choice. I believe that there is a very real chance that it will fail on both counts. I can illustrate this by notional figures.

Let us assume that there is a local authority nursery, which is at the boundary of financial viability with, say, 20 children. I use the figures purely for the sake of illustration. If it gets all the vouchers for those 20 children it can continue and maintain its financial viability. The Minister argues that if the local authorities are successful in retaining those presently attending local authority nurseries, local authority provision has nothing to fear. Let us assume that five children are taken out of local authority nursery provision and that their parents use the voucher to gain entry to the private sector. They use the voucher and use the top-up fees, because all the evidence we have received indicates that

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it will be necessary to top up the voucher if you move to the private sector. The Minister shakes his head, but all the evidence we heard in Glasgow from those who are providing private provision indicated that, even to recover the recurrent costs, let alone the capital costs, it would be necessary to charge top-up fees. So the five children move out of local authority provision and the local authority is left with the income from 15, which takes the total amount of income below the level that allows the local authority to provide the nursery povision on a financially viable basis. The local authority, faced with that, withdraws from nursery provision in that area. It simply cannot afford to maintain it with the loss of income.

At the end of the day the sum total of the effect of the voucher scheme in that particular example, and it is a valid example, is that five pupils move across from local authority provision into the private sector and 15 pupils have no nursery provision at all. In other words, there is a decrease in provision and the choice exercised by the five denies provision for the 15. That is one of the fundamental weaknesses of this scheme.

Lord Addington: Clause 23 brings in Part II of the Bill which everybody has been protesting about. Part I of the Bill is something which we would all, generally speaking, welcome and the other parts of the Bill do not inspire the same amount of protest.

When we bring in this voucher scheme we are bringing in something which can potentially, if not actually, cause division. It is bureaucratic; it is wasteful. In certain parts of Scotland it certainly has the potential for undermining pre-school education, which works. With that in mind, if we had the opportunity to divide on this I would certainly be supporting those noble Lords who have spoken because this is not the best way forward and it is that, and only that, on which I base my opposition to the clause.

Baroness Carnegy of Lour: It is very interesting that we continue to have coming from the parties opposite this intense dislike of putting the power to choose into the hands of local people; the power to choose something which is run by the local people or something which is run by somebody else. The arguments remind me of when Parliament discussed the question of choosing a school. There was intense suspicion that it would not work and it would upset all the arrangements. There have been problems, one of which is addressed in the Bill but, on the whole, it has worked very well. From the very start in Tayside people were allowed to choose their school, there was never a problem. I remember saying that in Parliament when we were discussing how necessary it was for everybody to have a choice of schools, and nobody believed it.

Lord Ewing of Kirkford: I apologise for interrupting the noble Baroness. The Bill, if enacted, would amend the position. Parental choice in choosing schools is not working. The amending provision is in the reserved places part of the Bill.

Baroness Carnegy of Lour: I am sorry. I did not quite hear what the noble Lord said.

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Lord Ewing of Kirkford: The Bill, if enacted, would amend the parental choice legislation to which the noble Baroness is referring because it did not work.

Baroness Carnegy of Lour: I have just said that. There have been problems and one of them is addressed in the Bill. Of course there have been problems but, on the whole, it has worked extremely well. The fear of this system is the fear of something different. As I hear the noble Lords opposite speak, New Labour seems to be very like old Labour: there is the fear of innovation, the fear of allowing people to have a say in what they are doing.

It will be very interesting to see, as the pilot develops, how people react to it. One cannot tell whether there will be time before the next general election for people to know enough about the possibilities. One seldom has a single issue playing a great part in the result of a general election but it will be very interesting to see whether people want to have a voucher for nursery education. I hope that will come through and that, whoever wins the next general election, people will have some confidence about this scheme as a result.

It is very sad to be quite so negative and to be following the producers all the time instead of listening to what people want. They want to choose, they want more nursery schools and they want more nursery schools in rural areas. Although we do not bet in this House on the outcome of legislation I should have thought that one would win if one bet on an increase in nursery education in rural areas as a result of the scheme. I am increasingly certain of that. There will of course be problems to be ironed out, and there will be changes in the way the system works as it is developed. But as a general principle and as a way of expanding nursery education, it seems that the providers are wrong, and the parties opposite are wrong in being so fearful of it. I hope it will go ahead.

Lord Goold: I am surprised at the pessimism of the noble Lord, Lord Sewel, with regard to the ability of local authorities to keep their pupils. I should have thought that, with the voucher system, people would want to spend their vouchers, that people who are not at present taking the benefit of local authority nursery schools would want to use their vouchers and that the numbers in all nursery schools would increase, in addition to new ones starting up.

Lord Sewel: That goes also for the evaluation, but there will not be time to take it on these issues.

The Earl of Lindsay: I was grateful for the intervention of my noble friend Lord Goold who makes the extremely good point that the opposition of noble Lords opposite to this clause and to the principle behind Part II is in part driven by pessimism and in part driven by some less attractive qualities than pessimism. Just 56 per cent. of four year-olds in Scotland currently receive nursery education and so 44 per cent. of Scotland's four year-olds will be in a position to request and purchase nursery education with the advent of the voucher scheme. There will potentially be a huge expansion in the provision of pre-school education because of this initiative.

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We believe that parental choice should be the driving force. The noble Lord, Lord Ewing, has an extraordinary definition of parental choice if he prefers a system whereby he would make parents go to collect their vouchers--for what reason I do not understand, and why that should represent better parental choice I do not claim to understand. We want to deliver those vouchers to the parents themselves without making them trail round the country to pick them up. Of course vouchers can get lost among the mess in the kitchen, but whether you pick the voucher up by car or whether it has arrived the post, will not make it any more likely to be lost.

We are convinced that this route will increase nursery education provision and increase parental choice. It breaks new ground and therefore outside this House I am not unsympathetic to some of the concerns people have. This is a scheme with which they are not familiar and therefore one tends to entertain the darkest notions when one is not quite sure what is coming one's way. But I am astonished at some of the deliberate scaremongering that is coming from noble Lords opposite, particularly as it can only undermine the confidence that some parents will have in the prospects which this initiative hopes to offer.

The Domesday scenario pictured by the noble Lord, Lord Sewel, is technically possible but, as I said, with a huge increase in the demand for nursery education in Scotland resulting from nursery vouchers it is very unlikely that a local authority school which is offering decent nursery education will start losing children. There may be another provider of education nearby which attracts five children from the school that the noble Lord, Lord Sewel, was imagining. However, at the same time there will be many more children in that area who suddenly, for the first time, have access to nursery education. If that school is providing a service of some quality it has no need to fear. If it is providing a service that is inferior to the service being provided by other competitive providers then it does have something to fear. But beyond that, there is a huge increase in customers and consumers who will be requesting and demanding education.

I return to the point made by the noble Lord, Lord Goold. On the whole, local authorities have a good record, especially in some areas, of providing nursery education. They will find that their market of potential customers is about to increase significantly and therefore there will be winners and not losers.

I would like to stress a point that I made earlier. The Audit Commission studied the position in England and Wales and it confirmed that the voucher value enables a taxpayer to meet either the whole cost, or nearly the whole cost, of provision of all kinds. We see no reason why the commission report on England and Wales should not have a relevance to the circumstances in Scotland.

I could defend Clause 23 at length, but I shall not do so because we more or less covered the ground in the debate on the various other amendments. I summarise by stressing our fundamental belief that we want to see nursery education expanded; that parental choice should be the driving force behind it; and that not only

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increased quantity and diversity of education from local authorities, the private sector and the voluntary sector should ensue but, indeed, quality will also be a watchword of the Scottish initiative on nursery vouchers.

We realise that there is no issue of principle as regards the clause and this part from noble Lords opposite. Pessimism is the less attractive feature of the Opposition as regards the principle. It is the absolute determination to prevent parents from being the principal point of choice that I find much more uncomfortable and much more unattractive. No doubt we shall return to debate Clause 23, Part II, at the Report stage when we can cover this ground again, but at the moment I would commend to the Committee that the clause stands part of the Bill.

7 p.m.

Lord Ewing of Kirkford: Before I beg leave to withdraw my Motion that Clause 23 shall not stand part of the Bill, I give notice again that we will return to this matter on Report. I am always interested to hear Government Ministers, particularly for Scotland, complaining that Opposition politicians are distorting their case. I think I have said before that when I was a Minister at the Scottish Office there were nine or ten press officers. There are now around 35 or 36--almost four press officers for every Tory MP in Scotland--and they cannot get their case across; and we get the blame for that. There is nothing between the Minister and myself on Labour-controlled authorities, and they are all more or less Labour-controlled in Scotland now. There is nothing between us on the desire to expand nursery education and to involve parents in the decision-making process--nothing between us on that at all. Our objection is to this divisive voucher scheme and to the dangers that it holds. That is why it will not be introduced under a Labour Government. I beg leave to withdraw the amendment.

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