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Lord Henley: My Lords, as I believe I made quite clear earlier, we do not believe it is right that central government, or for that matter local government, should make the various choices that, quite obviously, parents should make. The gentleman in Whitehall, as someone once said,--or, for that matter, the LEA--does not always necessarily know what is best. We have never said that the choice to which we are looking should immediately lead to automatic entitlement. We look to a growth of provision over time. We want a diversity of provision to build up in response to the needs of parents.

However, having said that, nothing in the Bill prevents a local authority putting together an early years strategy for expansion of nursery education. None of this prevents local authorities working closely with the private and voluntary sectors. Any local education authority can put together a development plan, or a strategy, for a particular element of its provision and, in doing so, can consult interested parties.

Of course social services departments and local education authorities have a duty under Section 19 of the Children Act 1989 jointly to conduct and publish a report on a review of day-care provision for children under the age of eight in their area, at least every three years. Such reviews cover services that they run themselves and those in the private and voluntary sectors. Although the legislation as such does not require the review of nursery or primary education facilities, the social services department and the LEA will need to inform themselves about the quantity and availability of such services. Let us be clear that nothing

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in the voucher scheme in any way affects local authorities duties and responsibilities under the Children Act 1989.

With that background, I hope that there will be some agreement--indeed, we seek that from the noble Baroness--that there is already legislation ensuring that the provision within an area is being looked at, and that there is nothing to prevent an LEA putting together a development plan of any description to inform its own actions and to help parents understand its plans more clearly.

There is no need to require LEAs to draw up a strategy under the provisions of this Bill. In summary, we believe that the manner of the expansion of nursery education should be determined by parental choice, not by LEAs.

Lord Ponsonby of Shulbrede: My Lords, it may be of interest to the Minister to know that it was my noble friend the late Lord Jay who said that the gentlemen in Whitehall sometimes do know best. I believe that the Minister was misquoting him.

Lord Henley: My Lords, I was aware that it was the late Lord Jay who made that remark. I was just transferring it into a form which I believe is certainly more acceptable to most of us; namely, that the gentleman in Whitehall does not necessarily always know best.

Lord Dormand of Easington: My Lords, if a local authority did not undertake the kind of consultation that is included in the amendment, would the Government encourage a local authority to do that in any way in view of the undoubted merit of the scope of the amendment, which covers a wide range of people like, for example, members of health authorities, and so on? In other words, would the Government remain completely neutral on the matter?

Lord Henley: My Lords, with the leave of the House, we are getting somewhat out of order at Report stage. I tried to remind the House--and I advise the noble Lord to read what I said--that there are certain duties on a social services department and on an LEA under the Children Act. They have a duty there, but we do not think it necessary to extend it in the way suggested by the amendment. We believe that it is better to leave the matter to LEAs to do so if they so wish.

Lord Dormand of Easington: My Lords, with great respect, that does not answer my question. In those circumstances, would the Government do anything about it or would they remain neutral?

Lord Henley: My Lords, with respect, that does answer the question. We believe that this is a matter for the LEAs but, as I said, there are certain things that they have a duty to do.

Baroness Farrington of Ribbleton: My Lords, I am often reminded, as a Member of your Lordships' House, that different political gatherings bring together different

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experiences of life. I have talked to Conservative colleagues, independent colleagues, Liberal Democrat colleagues and Labour colleagues in different parts of the country. The idea of local education authorities, together with voluntary-aided, voluntary-controlled, special-agreement schools, trying to increase the level of provision of nursery education for pre-school children in order to force on parents who do not wish to exercise the choice that provision and give them no alternative is something which is quite remote from the reality of life. Therefore, I find it difficult to understand what is the combined experience of Members of Her Majesty's Government that leads them to view nursery education in that way.

Secondly, there may be a group of parents out there, as yet undiscovered, who do not wish to have nursery education provided by the local education authority. But in that case, as I said on an earlier occasion in our debates in Committee and today on Report, there is absolutely nothing to stop the Government coming up with a scheme which offers parental choice to parents who wish to take a voucher from the Government in order to purchase something else.

But it is not the reality of life in the average community in England, Wales, Scotland or Northern Ireland that parents actually want to turn down something which is in danger of being offered to excess. In the next-steps document the Government aim to offer to all parents who want it for their children nursery education at the age of four. If that aim is to be met, 150,000 new places will have to be found.

In rural communities and in some of the more impoverished, difficult communities, it is only by co-operation and bringing together the community that it is possible to have development plans. Frankly, it is only when the Government are able to look at a collection of such development plans that they will be able to measure whether what they are prepared to say is their aim in election literature is actually being delivered in the country.

It is late and I shall not seek to press this matter to a Division at this stage. But it is a fundamental criticism of the Government's approach underpinning the whole of this Bill. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 6 [Power to borrow]:

Lord Tope moved Amendment No. 17:

Page 3, line 8, at end insert ("as does not fall within the meaning of the "core assets" of the school as prescribed by regulations made under section (Core assets) of the Nursery Education and Grant-Maintained Schools Act 1996.").

The noble Lord said: My Lords, in moving this amendment, I shall speak also to Amendment No. 18. At this stage we move from consideration of the nursery education provisions of the Bill to the provisions relating to grant-maintained schools.

We dealt with the question of core assets very briefly in Committee. I return to it today, and the purpose of the amendment is to try to tease out a little more from the Government about exactly what they propose and to what extent they propose to define the term "core assets".

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Since the Committee stage, the Minister has very kindly written to me a very helpful letter with more information on the Government's views. Towards the conclusion of his letter, he says that he very much shares my concern about the importance of protecting publicly-funded assets. I entirely accept that statement. The difference between us is as to how we see the best way to protect them. It is my view and the view of the supporters of the amendment that they are best protected through regulation so that the position is clearly stated and defined. The matter is then clear to the schools, which will want to know what is the position when they first come to consider it, and it will be known also to the funding agencies which will have to consider the applications.

I am sure that the Minister will tell us in a few moments that his view is that the matter is best left to the administrative discretion of the funding agencies and that that should be done on a case-by-case basis, perhaps a basis of merit. That is the difference of view between us. I suspect that it is for those reasons that the Minister will not be able to accept the amendment. If that is the case, it is all the more important that we press for more details of what is to be in the remit letter. In his letter to me the Minister said:

    "This guidance will take the form of a remit letter and it will be based on the consultation paper which we published last October".
But he then went on to say:

    "It will also reflect commitments we have made during the passage of the Bill".
I hope I may press the Minister to be a little more specific when he replies about exactly which commitments he has in mind that should be included in the remit letter. For instance, he went on to say in his letter to me that when the funding agency has to make decisions about what assets schools should be able to use as collateral it would have,

    "two simple rules of thumb:

    A. is the asset essential to allow the school to meet statutory requirements?

    B. is the asset essential to its functioning in other respects?

    In practice, this means that for school land, there will be a reasonably objective way of determining what is core; schools will not be able to mortgage playing fields that they need to comply with the School Premises Regulations.

    For school buildings, the starting assumption of the Funding Agency for Schools will be that all buildings are core assets. But it will be open to schools to argue to the Agency, in submitting their loan applications, that particular buildings are not essential to a school's functioning--that the main business of the school could be carried on without them--and that they should therefore be mortgaged".
It would be useful to know whether the Minister intends that that is one of the commitments that will be continued and will be put in the remit letter in those terms.

The purpose of the amendment and of the debate tonight is to try to tease out a little more understanding of what is meant by core assets and to understand a little better what is in the remit letter and particularly to press again for an assurance that there will be further consultation with interested bodies on the contents of the remit letter before it is published. I realise that it will be published and of course they will see it then. I know

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that local authorities and others were consulted in the original consultation paper. They stated in response to that consultation paper:

    "It will also be necessary to have a much clearer definition of core assets if schools and FAS are to be able to form a reasonable idea of what is allowable. This might, for example, include specific reference to whatever guidance the Department issues on teaching areas and particular subject requirements in lieu of statutory minimum area requirements following the proposed revision of the School Premises Regulations. Even so, we are not confident how well placed FAS would be to reach judgement from a distance about what is core and what is surplus. A dispassionate and fair assessment will be important".
That is what was said in response to the consultation paper. The final sentence of that response remains central to this issue. If the FAS has no detailed guidance to follow, it will be even more difficult to ensure that it has reached the right decision. Better safeguards need to be put in place. We believe those should be on the face of the Bill; the Minister does not, but I hope he will be more specific about what exactly he intends to include in the remit letter. I beg to move.

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