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Lord Filkin: On the noble Lord's last point, that is exactly so. The additional moneys that local authorities choose to put into schools in their area will be completely within their discretion.

On the situation described by the noble Lord in terms of the transition from one system to another, local authorities will not be required to continue to put funding into schools. They will not lose funds from the rest of their grant to fund the transitional damping process because central government themselves will provide it in order to avoid exactly the problems about which my noble friend Lord Smith was concerned. He asked whether there would be a hard landing and a sudden shift.

The noble Lord, Lord Lucas, is also right in that over a period of time, school funding will move towards accordance with the general formula for distribution as indicated by the dedicated schools grant and as vitiated through the distribution decisions made by local authorities themselves as part of their distribution responsibilities.
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That is so complicated that it may be better if I put the detail into a full note to the noble Lord and copy it to other Members of the Committee.

Lord Hanningfield: I do not want to start another detailed discussion, but it is worth pursuing this a little further. What is likely to happen to local authorities? They will not put money into schools actually to fund basic five-to-16-years education, rather they will fund the extended school way. In partnership with schools, they will support extended schooling, family development, social services and children's issues on each school campus. I sought to make that point when I introduced this debate.

Local authorities are to leave it to central government to fund the basic education budget, which is to be dealt with on the other financial year basis—from April to April with no three-year guarantee on funding. I know how that will operate in my own local authority. A lot of money will be injected into schools for supporting families and children outside the education system. We will find that school campuses will be supported in different ways. Part of the money will come from central government through the new system being introduced and part from local authorities, which will fund other things happening on the school campus. I am sure, as the years go by, that that is how this system will operate.

We are now in a major transition in the way that schools operate. Given that, it would have been more appropriate if this legislation had been introduced three years ago rather than now, given the way schools are to develop over the coming few years. Perhaps the Minister will clarify that that is what will happen. Money is to go into schools from different sources.

Lord Filkin: I should not venture to display my forecasting skills on decisions over which I have absolutely no control whatever. The noble Lord may well be right, in which case what he says will give some comfort to the noble Lord, Lord Dearing. In truth, I do not think that any of us really knows. It may be that it will be exactly as the noble Lord, Lord Hanningfield, has set out: LEAs which still have a passion for raising the educational and other attainments of their children will choose to behave in the way he has described, or it may be a more mixed picture. I think that I would put my money on it being a more mixed one, given the diversity of local government and the range of local politics. However, I could be wrong and I have no knowledge either way.

Lord Lucas: Before the moment passes, I rise only to accept the offer of a note from the noble Lord.

Lord Hanningfield: We have had a very extensive debate on an extremely complicated issue. Like myself, the noble Lord, Lord Smith, is the leader of a local authority and therefore becomes involved in these things in considerable detail. Wearing my other hat as the leader of a local authority and not speaking as a Member of this House, at the moment even a small school usually knows where to go. I am often
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approached, even though we have over 600 schools in the county of Essex. It is a pity that we shall lose some of those links.

Some schools have only two or three teachers, while other schools operate on budgets in excess of £10 million. There is a tremendous diversity in school provision. I would not want to be the Government Minister who has to introduce this for our 25,000 schools because there are going to be a lot of problems.

Lord Filkin: I am genuinely sorry for interrupting the noble Lord. We do not want to alter in any way the relationship between schools and the noble Lord when he is wearing his hat as the leader of a local authority. Schools should continue to go to their local authorities, which will have the roles of leadership and support for raising the educational attainment of the children in their area. I expect that schools will continue to turn to their local authority leaders.

Lord Hanningfield: The Committee will probably have had enough of this debate today. We shall analyse everything that has been said. I hope that the Minister will write to me and others, as he has promised. With that, I shall not pursue my opposition to the clause standing part of the Bill today.

Clause 98 agreed to.

Lord Lucas moved Amendment No. 141:

"Local education authorities as champions of the child and the family
The Secretary of State shall take such measures as he considers necessary to promote and provide for the role of local education authorities as champions of the child and the family, and in particular shall issue a consultation document on the central funding of statemented pupils and of pupils whose education is being provided in pupil referral units."

The noble Lord said: At Second Reading the Minister said that he was intent on moving local education authorities away from the historic position of being the controllers and distributors of money at their own discretion towards being champions of the child and family. I find that ambition wonderful and I very much hope that the Government will make it happen.

However, the obstacle in the way of that, with which I am familiar, is the conflict between the fact that the local authority may wish to be the champion of the child but, on many occasions, being the champion of the child can put it under impossible financial strain.

Special educational needs are a case in point. If local authorities became the champions of the child and the family and were out there trying to discover which children have special educational needs and providing properly for them, in ensuring that that happened, their SEN budgets would run beyond their extremely limited ability to deal with them under the current financial systems.

As a result, many local authorities have become the enemy of the child and the family by imposing extreme delays and denying that special educational needs
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exist. This makes the whole process very difficult. It is the articulate and the persistent who get what they want, and ordinary citizens—particularly their children—have an extremely miserable time. A two-year delay in dealing with children with severe dyslexia, dyspraxia or other behavioural special educational needs can cause long-term damage and make them very difficult to deal with.

A parallel problem occurs in pupil referral units, which are expensive. Very often the best thing for such children—and very often the best thing for their classmates—is to give them a breather; to give them a chance to get straight, to re-motivate them and to get them going again in an environment which is designed for them rather than for other children. Where these units work well, I have been impressed by what they achieve. But they are expensive and local education authorities, if they are keen on providing such facilities, often seem to be held back by the fact that the funding has to come out of a very limited budget.

Both of these matters conspire against local authorities becoming the kind of creature that the Minister said he would like them to become. I should like to know what he proposes to do about it. I beg to move.

Lord Filkin: If the noble Lord, Lord Lucas, will bear with me, I shall speak without my notes. This is an issue on which I have a policy responsibility as well as the pleasure of taking the Bill through. It is the kind of issue that would genuinely benefit from the opportunity for a fuller debate than that offered even by the Committee stage or Second Reading.

I strongly agree with much of what the noble Lord said. When we are dealing with special educational needs—whether at the softer end of a mild slowness in learning, for whatever reason, or at the very severe end of low incidence, high cost need—it is critical that there is early identification and early intervention. All the evidence shows that if you can identify with the parents that there is a problem and work with them on what might be an appropriate set of interventions very early on, you achieve two things: you reduce the risk that the child's education will suffer through the alienation that can follow on from that; and you reduce the risk that the parents will feel forced into an adversarial relationship with the local authority because they are worried about their child and it does not appear to them as if the system is responding adequately.

I am simplifying matters greatly, as the noble Lord, Lord Lucas, knows, but why I understand and support what he is trying to do in principle but do not support it in practice is because, essentially, he is pushing it all into a central pot and using—although he did not say this exactly—a statement-type process to get provision made and then to get the intervention. While undoubtedly a statement is necessary for some children with particularly complex needs—because that is the only way in which you can bring to bear the expertise, diagnosis and the funding package to intervene—in very many cases you do not need a statement.
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The best local authorities have demonstrated in practice that they can reduce the need for statements by getting better at much earlier intervention and identification. That is why we have been really pleased by the evidence of the early support programme which tries to bring intervention in the first less than three years of the child's experience and into early primary school settings. So you identify that there is a problem and you bring in the package of support.

That works by increasing, rather than reducing, the amount of budget that the school itself has to deal with SEN issues so that it does not need to go elsewhere to get either the cash resources or, for example, to get an educational psychologist to come into the school and to work with it on identifying the needs of the child. We have now seen enough of this to know that it is not theory; that, where it is working, it is good practice. Without threatening the noble Lord with two letters, I should be pleased to set out this argumentation in more detail.

This is the thrust of our policy. It does not mean that there is no role for the centre—there is a massive role for the centre—but it does not mean that the answer is to push all of the resource into the centre either. The more that the school or pre-school setting can identify the problem and have the skill, the resource and the access to specialists to intervene early, the better the service to both the child and the parent.

I hope that has been helpful. I am happy to write to the noble Lord in more detail if he would like me to do so.

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