Schools Funding

Graham Stuart Excerpts

Tuesday 29th April 2014 Westminster Hall

[Mr Graham Stuart (Beverley and Holderness) (Con)]

Thank you, Mr Hollobone. It is a pleasure to serve under your chairmanship and to follow such a powerful, well thought-out speech by my hon. Friend the Member for Worcester (Mr Walker); he has done a sterling job since coming to the House in 2010. The turnout today is a reflection of not only the importance of the issue to our constituents, but the leadership that he has shown. He has shown that again today, with his powerful championing of the case.

The campaign for fairer school funding has been running for at least a decade. For too long, the extra costs faced by rural authorities have not been acknowledged properly by the funding system. A whole generation of school children, in places from Devon to Northumberland, have lost out. Seven years ago this week, I led a Westminster Hall debate on this very subject and it has become no less urgent since. As everyone in the Chamber knows, for many years the school funding system in England has operated on the basis of outdated data and in accordance with political priorities that channelled funding away from rural areas and into urban ones—based on politics, not need. In the 13 March statement on school funding, the Minister for Schools hit the nail on the head when he characterised the end result as

“opaque, overly complex, and, frankly, unfair to pupils, parents and teachers.”—[Official Report, 13 March 2014; Vol. 577, c. 427.]

The inequity is recognised across the political spectrum. In an article for The Guardian earlier this month, Fiona Millar—not exactly the greatest champion of the Government’s policies—admitted that

“the differentials between London and the rest of the country, which are often rooted in historical political decisions, are simply unfair.”

If Fiona Millar can see that, the case for change across the spectrum is overwhelming and needs to be acted on.

One does not need to look far to find glaring examples; the East Riding of Yorkshire is a case in point. It is a beautiful part of the world, but it does not conform to any lazy stereotype of rural affluence. Median gross earnings are below the national average and towns such as Withernsea, Goole and Bridlington have pockets of real deprivation. Mike Furbank, head of children and young people’s services at the East Riding council, has explained:

“As a rural authority we suffer the hidden deprivations of social isolation for children living in remote communities where families have limited access to services and the wider cultural life of the area.

These deprivations are not recognised in any formula and often the ‘goldfish bowl’ view of village life makes poor families unwilling to accept support or declare their eligibility.”

[Andrew Percy]

Will my hon. Friend give way?

[Mr Stuart]

With an eye on the Chair, I give way to my hon. Friend.

[Andrew Percy]

I am grateful. Obviously, I am also grateful for the extra funding for the north-east, but my hon. Friend is right to highlight the deprivation of Goole, in the East Riding part of my constituency. Does he share my shock that local Labour councillors in Goole have attacked me for campaigning on the issue and for pointing out how much less well off Goole was, compared with neighbouring Hull and Doncaster, although we have the same levels of deprivation?

[Mr Stuart]

The aim of the Rural Fair Share campaign, which I co-chair and helped to found, is certainly to ensure that fair-minded Labour Members of Parliament see the case as well. We have to ensure that the split is not partisan; we are looking for a system that takes scarce resource and allocates it on the basis of need. At a time of austerity, it is more rather than less important to get those allocations right. Such reallocations may be politically difficult, but because no more money is being thrown at the system every year, the unevenness becomes more apparent as the tide goes down and creates a more difficult challenge.

The East Riding has some good schools, but, regrettably, too many indifferent ones. Last June, Ofsted reported that in the East Riding a child has only a 66% chance of attending a good or better school, compared with 79% in England as a whole. Only 38% of secondary schools in the East Riding are rated good or outstanding, compared with 74% in neighbouring North Yorkshire. If the Minister compares the number of good or outstanding schools in the East Riding with those in neighbouring similar authorities, she will see a stark differential. In the light of those numbers, I ask her to reflect on the methodology that the Government have come up with to allocate that welcome £350 million.

I am aware that, given my position as Chair of the Education Committee, I ought to keep my language moderate, but was the person who devised the system sober? The Government have put things off; the national funding formula will come, but they have decided—politically or otherwise—that, a year before a general election, a fundamental reallocation is perhaps not politically deliverable. The interim £350 million to help the poorest-funded authorities, however, is welcome. But why is the money going to authorities in London that are not among the poorest-funded authorities? My hon. Friend the Member for Worcester touched on that, as did my right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith). We do not want to see the money stripped away from Northumberland; the Minister must have the courage, despite the publication of the allocations, to look again at the methodology.

The East Riding, because it was historically underfunded and had so many small schools, poured all the money it could into the schools block of funding and so had the lowest high-needs block in the country. The new methodology, however, looks only at the schools block. Under this intervention to help lower-funded authorities, what is the situation of the East Riding of Yorkshire—the third-lowest-funded authority overall when the whole quantum is considered? It is moving from being the third-lowest-funded authority to being the lowest-funded in the entire country. After many years of campaigning, that does not feel like a result. I ask the Minister to look again at how the money is allocated.

--- Later in debate ---

[Kevin Brennan (Cardiff West) (Lab)]

I congratulate the hon. Member for Worcester (Mr Walker) on securing this debate and on his speech, in which he outlined many of the problems with the current funding formula system. He was ably supported by many other hon. Members. He pointed out the reasons why the Government should spell out their longer-term intentions in relation to the national funding formula and why, although his hon. Friends might have criticised me for saying so, the Government should not hide the fact that there will be losers in the process or pretend that there will not be, just because we are a year away from a general election. I might have been criticised for saying that, but it is the truth. We must ensure that we are open and transparent about the journey that we are on in relation to a fairer funding formula for our schools.

[Mr Graham Stuart]

Will the hon. Gentleman give way?

[Kevin Brennan]

In a moment. I was just about to mention the hon. Gentleman, so I will do that first before giving way briefly. Other contributors to this debate have included the Chair of the Select Committee, the hon. Member for Beverley and Holderness (Mr Stuart), who did in his remarks exactly what I did by pointing out that the timing of the announcement could be interpreted in a certain way if one were of a cynical bent, as some of us might be from time to time.

[Mr Stuart]

I am grateful to the hon. Gentleman. He will know that in times of austerity, redistribution is harder. He said that we are on a journey. Is his party on that journey? Will he commit today to coming forward during the next Parliament, should his party form a Government, with a national funding formula that bravely reallocates funding and has losers as well as winners, in order better to match need with the funding that goes alongside it?

[Kevin Brennan]

I can absolutely confirm that we are on that journey. The last Government started the consultation process on that journey towards the end of the last Parliament, as the hon. Member for Worcester mentioned in his opening speech.

We also heard contributions from the right hon. Member for Banbury (Sir Tony Baldry), who mentioned Taoism in his remarks, and from the hon. Member for Hexham (Guy Opperman), who mentioned Deng Xiaoping. Perhaps I can also quote Zhou Enlai, who, when asked about the effects of the French revolution, said that it was too early to tell. It is also, perhaps, a little too early to tell exactly what the outcome of the funding formula for schools will be, but we would welcome some transparency about it from the Government.

I associate myself with the remarks of the hon. Member for York Outer—

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Education (Elizabeth Truss)]

I congratulate my hon. Friend the Member for Worcester (Mr Walker) and the F40 group for the amazing progress that has been made on this campaign. As hon. Members have said, this long-standing issue is finally starting to be dealt with. It is down to the dedication of all right hon. and hon. Members who have attended this debate and made such eloquent contributions that we are finally making progress on this issue.

Many hon. Members have highlighted the idiosyncrasies and unfairness of the current system. I do not think that there is any disagreement about that. Our spending on education is the fifth highest in the OECD. We have protected the education budget during this Parliament, because we believe that education spending is vital for the future of our children and our nation. Nevertheless, this spending is not fairly distributed at the moment; it is unfair and inefficient. Unfortunately, this unfairness has been baked in over the years, so even when education budgets were rising significantly, it was not dealt with. We are playing catch-up at the moment, as was mentioned by a number of hon. Members, my hon. Friend the Member for Redditch (Karen Lumley) in particular.

My hon. Friend the Member for Worcester made the good point that the link between funding and attainment is not always clear, but that there is greater clarity in respect of those from the most deprived backgrounds. Of course, one of our main priorities as a Government is closing the gap between those on the lowest and highest incomes. We have a long tail of under-achievement in this country that has a profound impact on social mobility and our economy, and that is something that we are keen to address.

My hon. Friend the Member for Stroud (Neil Carmichael) referenced the report, “Unseen Children”, which highlighted the issues for children in rural and coastal areas in general. That is a major problem, and we need to deal with it.

My hon. Friend the Member for Thirsk and Malton (Miss McIntosh) talked about the issues faced in her constituency. I associate myself with her comments about the terrible tragedy of the dedicated teacher, Ann Maguire, in Leeds. I went to school in Leeds. My thoughts are with her friends and her family.

I am pleased that hon. Members have recognised that the Government have provided £350 million of funding. I cannot provide the hon. Member for Cardiff West (Kevin Brennan) with additional information about his parliamentary question, but it is significant that the Government have found this additional money. We recognise that this is a priority. We are vigorously pursuing a route towards a national funding formula, which is the right way forward, and we are pressing that case. This funding represents a step towards it.

[Mr Graham Stuart]

The consultation on how the £350 million is allocated closes tomorrow. It is difficult to comment once indicative allocations have been given, but is it a genuine consultation? Will the Minister consider points that have been made and, despite the political difficulties, ensure that that funding is distributed in the fairest way possible?

[Elizabeth Truss]

It is a genuine consultation. We will listen to representations, not just from today’s debate, but from discussions that we have had as a team with the F40 group. It is a difficult process, obviously. A lot of hon. Members mentioned the problems in moving towards a fair national funding formula.

A number of hon. Members mentioned that the longest journey begins with a single step. We have made that step. There are always issues with the way that a formula for minimum funding is decided; all sorts of aspects have to be considered in a formula, including sparsity, rurality, deprivation and attainment. There is no perfect formula. There will always be some local authorities that gain more and some that gain less, and even when we get to the holy grail of the national funding formula, that will be so. There has to be a formula. However, where the Government have had an opportunity to allocate new money, as with the two-year-old offer, we have allocated it completely fairly throughout the country, and done so on a per-child basis with an area cost adjustment. Where this Government have had an opportunity to allocate new money, we have done it fairly.

I am committed, as my colleagues are, to a national funding formula. It is incredibly important for equity, social mobility and for our long-term economic plan, as hon. Members have said.

I recognise the issues raised about the high-needs block and the perceived unfairness of looking at the schools block. There would be issues in looking at the entire block, as well. Because the whole situation is so complicated, with the schools block, the high-needs block and the early years block, we have taken it step by step, starting with the schools block. That matter has come through in the consultation and we will look at that.

I note the specific issues in Staffordshire, the East Riding, Leicestershire and Warrington. I agree with my hon. Friend the Member for Warrington South (David Mowat); I have seen excellent attainment in Warrington, at the Evelyn Street primary school, which I visited with him. It is a such an outstanding school that we are using it as a national case study of how to integrate early years into schools. Fantastic work is going on in Warrington, but that does not mean that Warrington should be underfunded.

I have also taken the point about the area cost adjustment, particularly about how that has benefited London authorities in particular. We have to reflect the cost of teacher salaries in different areas, but how that is reflected in the overall allocations will be under consideration in the consultation.

We have recognised sparsity, although a number of my colleagues do not think that we have recognised it enough. But it is recognised in a minimum funding level, with a grant being given per school.

I acknowledge points made about the rising costs faced by schools, whether teacher salaries or pension and energy costs. However, in difficult economic times, we have protected education spending in real terms, because we consider it a priority. The question about what we will do on education spending and the national funding formula is important for our respective parties, going forward into a future Parliament. I cannot fully announce our position on that today; we are still working on the plans.

My hon. Friend the Member for Hexham (Guy Opperman) said that he is pleased that we are going in the right direction. It is important to acknowledge that. This has been a long time coming. We have taken steps with the £350 million, although people may not think it has been allocated in an absolutely ideal fashion. There have been detailed discussions about the modelling used for the formula. This is probably a precursor to discussions that will go on about what a fair national funding formula will look like.

I also acknowledge the points made by my hon. Friend the Member for Cambridge (Dr Huppert) about the positive changes that we have made in Cambridgeshire, particularly with respect to the capital budgets there.

To summarise, we have made the largest step that we can in a single year by securing the additional £350 million funding, without creating major turbulence in the system, which is a danger of moving too fast in funding reform. There is not a perfect formula. The arguments will continue about what factors are most important and what really drives the costs in schools. The Department is working on better analysis of schools’ costs, so that we can ensure that a future national funding formula properly reflects the costs, such as attracting and retaining high-quality staff in rural areas. I commit to listening to representations.