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Lord McIntosh of Haringey: I am a conspiracy theorist. I assume the worst in all circumstances. I can assure my noble friend that I questioned officials deeply when I saw these amendments. The idea of inadequate consultation or additional charging or a lack of financial planning would have turned me utterly against the idea of academies in the first place. I shall not comment on his fundamental distrust of academies. If he had wanted to express that, I have no doubt that he would have tabled an amendment to that effect. However, he has tabled amendments about the detail of academies. I believe that I can reassure him on each of his points.
I believe that Amendment No. 240, which proposes that a funding agreement be published six months ahead of being formally entered into, is unnecessary. Where it is proposed that an academy be established in response to an LEA invitation to interested parties to bring forward proposals to provide an entirely new school, the provisions of Clause 66 of the Bill would apply. Where an academy replaces one or more existing schools, the system is again clear and transparent—the LEA, or the governing body as the case may be, will consult locally and publish notices in accordance with the relevant sections of the School Standards and Framework Act to close the existing school. Those notices will set out the arrangements to be made for the pupils who attended those schools and the provision to replace that which is currently made in those schools.
My noble friend Lord Peston will remember that when we went comprehensive in Haringey in 1967, we closed all the schools. He will also remember how long it took us to close them. It took a great deal longer than six months—the period provided for by this amendment.
Under the provisions of Clause 62, before signing a funding agreement, the Secretary of State already must consult the LEA in which the academy is to be located, and any other academy from which significant numbers of pupils are likely to attend.
In practice, the funding agreement will be signed many months—not six—in advance of the opening of the academy. In the case of the Walsall academy, which was undertaken with the enthusiastic support of the local education authority, the agreement was signed in December 2001 and the academy will open in September 2003. There are no circumstances in which a school could open within less than six months of the signing and publication of the funding agreement.
With regard to Amendment No. 241, I can assure the Committee that the financial controls must and will conform with the requirements of both propriety and good financial management. Through their funding agreements, academies are required to ensure that appropriate financial planning and management controls are in place to safeguard public funds.
Incidentally, I can again reassure my noble friend Lord Peston that there is no more generous public funding for academies than for maintained schools. There may be more funding from sponsors, but there is no more funding from the public purse than for maintained schools. With regard to the issue of public assets going into the academies, I can also assure my noble friend that if for any reason the academy comes to an end—a point that may be dealt with in later amendments—there is no question but that those public assets will return to the public sector.
Academies are expected to be companies and charities. They are required to prepare and file with the Companies Registry such annual accounts as are required by the Companies Act 1985, and to prepare and file with the Charity Commission annual accounts prepared in accordance with the statement of recommended practice. They must also comply with their obligation under the Charities Act 1993 to prepare an annual report and to transmit it to the Charity Commissioners. Through their funding agreements, they are required to secure annual auditing of their accounts by independent auditors appointed under arrangements approved by the Secretary of State. That is the formal position. Will that meet the requirements of good financial practice, which is what the amendment seeks?
Unfortunately, the amendment would undermine an academy's ability to manage its affairs and carry out its core function of raising standards in some of our most disadvantaged areas. It would seek to include in an academy's funding agreement, which is a legally binding document, a detailed financial plan for the first five years of the academy's existence. It would bind an academy to a rigid, long-term spending regime from which it would not have any flexibility to deviate. That kind of requirement is not placed on maintained schools. If we are seeking equality with maintained schools, the amendment would depart from that. We want to give—and the whole thrust of government policy has been to give—the maximum amount of flexibility to schools to manage their own affairs.
Amendment No. 244 relates to charging. Again, I can give the Committee assurances on this point. Clause 62 provides that no charge may be made for admission to, or attendance at, an academy. The standard funding agreement provides that academies should act in accordance with certain sections of the 1996 Act, as those provisions apply to maintained schools; in other words, Clause 62, taken with the provisions of the standard funding agreement—which, as I said, is available in the Library of the House—means that academies are treated in exactly the same way as maintained schools.
I know that my noble friend is not satisfied with the position of maintained schools. I realise that he does not like the provision that, for example, musical tuition for groups of fewer than four can be charged for. I also know that my noble friend does not like the fact that charges for travel and accommodation on school trips can be made. However, that is the wider law as it applies to maintained schools. It has been thrashed out over a very considerable period of time. Therefore, to require academies to depart from the conditions for maintained schools, will, as I said earlier when we discussed the issue of school companies, mean that adult education centres, for example, could not charge for classes held on school premises outside of school hours.
In common with maintained schools, academies can levy charges for board and lodging for residential trips, and for what are called "optional extras"; but they can do no more. We would never agree that they should do any more. My fundamental point for all these amendments is that there are no privileges here in any of these respects for academies. The standards required of maintained schools apply equally to them.
10.45 p.m.
Baroness Blatch: I agree with the noble Lord about the degree of accountability of these schools: they are very accountable in a most public way. However, it is my understanding that they do in fact receive greater revenue funding from the Government. I also understand that the children who attend them receive more hours of education than those in maintained schools.
Lord McIntosh of Haringey: I do not know the position regarding school hours. They have greater flexibility as to what hours they offer, but they certainly do not receive more funding.
Lord Peston: I must begin by apologising to my noble friend. I, too, was under the impression that academies were more generously financed. However, my noble friend is advised, and I have to work these things out for myself. Given what I was pretty sure was the case, I certainly hope that he will ask his officials to check the position. I was very much under the impression that such schools were more generously financed for current expenditure, but, because I am a perpetual student, I am always delighted to be corrected on such matters.
I am very much reassured by what my noble friend said on the charging point. I should add that my objection to charging is not quite as strong as he maintained. If what is charged for is defined as part of the curriculum, which it often is, it just should not be charged for. The fight for free education in our country simply should not be ended because of new doctrines that emerge. However, if such activities are nothing to do with the curriculum and are extraneous, I can live with the situation. What is troubling me is that sometimes they form part of the curriculum and great pressures are put on very poor parents to find money that they should not be asked to find. None the less, although I suspected that there was something special about these schools, as opposed to others, I take my noble friend's assurance that that is not the case.
I shall read my noble friend's response with care. I am a little mystified here. I do not see that the criteria set out in my amendment for proper financial behaviour and probity would in any way restrict schools. After all, every organisation must have the sort of financial arrangement that I have outlined. I have not noticed that business enterprise complains because it has to have proper financial arrangements in terms of flexibility, and so on. Having a full financial plan covering five years is absolutely standard in business. Therefore, why it should in any way limit these schools is quite beyond me.
Lord McIntosh of Haringey: It is a legally binding document, and that is not the case for the financial plans of businesses. It would not be capable of amendment in the way that a business plan would be.
Lord Peston: That mystifies me even more. A well-run operation sets out what money it proposes to spend and where it will get it from. The fact that it is a legally binding document does not excuse bodies from doing exactly that. It would be foolhardy not to do so. To use a word that has been bandied about, it is all semantics and we really agree.
We have covered some of the ground, but it is not the end of the matter, although my noble friend the Minister has been very reassuring. I need to put on record more strongly my antipathy to these bodies. That can wait in the hope that the subject of academies will come up in daylight hours in a couple of weeks. I beg leave to withdraw the amendment.
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