Education Funding in London

Graham Stuart Excerpts

Wednesday 4th May 2016 Commons Chamber

[Robert Neill]

The hon. Lady is almost an hon. Friend when West Ham are playing on Saturdays, and we hope for a good end to the season. She is right, and that brings me to the second point about funding. First, some outer-London boroughs are no better funded than shire counties anyway, yet in London there are much greater costs than in the rest of the country; and secondly, there is an artificial distinction in how funding in London is split up between inner and outer London. If justice is to be done in a formula, we need to move away from that distinction, which is purely historical. It goes back to the creation of the Greater London Council in 1963, when the then Inner London Education Authority was in fact part of the old London County Council, which had been a county education authority, while the outer-London boroughs had been educational authorities in their own right, either as parts of counties or as county boroughs. The historical anomaly that the hon. Lady mentions is the fact that her local authority is an amalgamation of two county boroughs that are part of the east end but were not in a county of London, so are treated as being in outer London, whereas Wandsworth, for example, which, in many respects, is much more prosperous, is an inner-London borough. That is a wholly illogical and unsustainable distinction that we need to break down because it distorts the arrangements.

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

My hon. Friend is right. The funding system we have today, handed over from the previous Labour Government, is broken in London and in urban and rural areas alike, and needs to be fixed. On additional costs in London, no proposal that I have seen from anyone, including F40, suggests anything other than that London would continue to have significantly more money per head than other areas.

[Robert Neill]

I am grateful for that point, and I accept it. Provided that we get that built in, this need not be an argument, but rather a question of making sure that any formula reflects the diversity of needs that exists within London.

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[Rushanara Ali]

I thank my hon. Friend, and I hope the Minister listened carefully to her powerful insights about what will happen both within and across local authorities. It will be schoolchildren who suffer, and the improvements in performance in London schools will be put at risk. That improvement is the envy of the world, with many studies showing how London has progressed. It has taken a generation to achieve that, and I hope the Minister will recognise the concerns being expressed today and the dangers of the changes, which risk having a negative effect on the performance of London schools.

I want to highlight some of the challenges that exist and the backdrop against which London has transformed its schools. As I said, that has taken a generation, and the danger is that the change will set us back in a very short time. London faces some of the highest child poverty levels in the country, and, as the hon. Member for Bromley and Chislehurst pointed out, the highest inequality. The extremely high cost of living, and especially of housing, has a detrimental effect on teachers’ ability to find accommodation.

Despite those challenges, local education authorities across parties—Labour councils as well as Conservative councils—have worked tirelessly to improve education in London. As a result, nine out of 10 schools are good or outstanding. I hope the Minister will think carefully about the impact of the reforms on that progress. If we are not careful, we will set schools in London back.

Other regions see London as an exemplar. People point to the London Challenge, which the last Labour Government introduced, and which was supported by people across parties and recognised for its achievements. Other regions have tried to emulate it. It is really important that we build on the successes of our regions rather than pit them against one other, which I fear will happen as a result of the changes. It is wrong to put educationists in competition with each other for the wrong reasons. We should be looking at how to improve the achievement of all our children, across the country.

[Graham Stuart]

It is worth saying that it is important to have a fair system across the country. Certain parts of London—and it is only parts—have disproportionately benefited. A Lambeth school can have more than £1,500 a head more—for a class of 30, that is £45,000 more—than a school half a mile away in Croydon. We have a broken system, and we need to fix it.

[Rushanara Ali]

We have very good results in London. Nine out of 10 schools across London are good or outstanding. We should build on that, not pit schools against one other. The hon. Gentleman served on the Education Committee so should know better than to make that argument.

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

It is a pleasure to take part in this debate and I congratulate my hon. Friend the Member for Bromley and Chislehurst (Robert Neill) on leading it.

It is also a pleasure to follow the hon. Member for Bethnal Green and Bow (Rushanara Ali), although I must say from the outset that I did not agree with the tone of her speech. The Labour party is committed to the fair funding formula. The one we have now is broken and it is broken in London. I described the difference between Lambeth and Croydon, but we can find examples all over London. Schools hundreds of yards apart have differences in funding of up to tens of thousands of pounds per classroom. The current system is completely broken and wrong, and it is wrong across the country. The biggest gainer from the F40 proposals would be Barnsley. Other major northern cities would be beneficiaries, too. If we created a fairer system, other northern cities would lose out, because what we have now is erratic, irrational and bears no examination.

I beg Opposition Members in particular not to use the language that the hon. Lady used. The Government have set out a consultation on the principles. She did not itemise a single principle in the consultation with which she disagreed; she simply asserted that it was some sort of appalling assault on London to reverse the progress that has been made. Nothing could be further from the truth. There are limited resources; that is recognised by those on the Front Benches on both sides of the House.

Talk of levelling up is all very well, so long as the hon. Lady’s party is committed to the vast budgetary increases that that would require. However, the Labour party is committed to no such thing and neither is the Conservative party. Even if the budget for this broken inequitable system was increased, we would still have to sit down and seek to ensure that the needs of every single child, regardless of disability, race or geography, were met.

The hon. Lady was right to say that we should have a system based on needs. That is precisely what the Government have consulted on. Whatever they come up with will doubtless not be perfect—nothing ever is—but to question the motive, when the Government are setting out to introduce a fairer funding system with the support of Labour Front Benchers, is beneath the hon. Lady. To say that London education will be decimated is so far from the truth. We need every area of the country to enjoy the improvements that have happened in London. One way to do that—it is only one way; money is not everything—is by making sure we have a system that is truly fair. I hope that, across the House, partisan voices will not stop us coming to a fair and consensual conclusion.

[Lucy Frazer]

My hon. Friend makes a very important point. We need fairness so that every child has an equal opportunity to get an education. Does he agree that many of the points made about London—growth, special needs, high house prices, a need to recruit and retain teachers—apply to other areas of the country, too? I cite by way of example Cambridge and its outer areas. Every one of those factors applies to us as it does to London.

[Graham Stuart]

My hon. and learned Friend is absolutely right. We heard language about dividing communities. With respect, the only person attempting to do that today is the hon. Member for Bethnal Green and Bow, who used inappropriate language. No one is seeking to divide communities. We have a broken system. If anyone would like to make the case that the current system is fair, reasonable and just, then please do so. But if it is not—and it is not—then we have to redistribute.

Making pernickety points about the manifesto, which says that the Government are going to protect the amount of money per child—which they are—[Interruption.] To the point where we cannot redistribute from someone who is grossly and unfairly funded in one place to another person somewhere else who is on the other end of the spectrum? That is ridiculous. Again, that is beneath the hon. Lady who brought the issue up and it is beneath other Labour Members—including the highly distinguished figure of the right hon. Gentleman, to whom I am happy to give way.

[Stephen Timms]

I think most people do not regard manifesto commitments as pernickety. The difficulty with the case the hon. Gentleman is making is that he is dressing it up in terms of principle. The reality is that he is asking for more resources for his local authority and less for others. Will he be frank enough to acknowledge that?

[Graham Stuart]

The right hon. Gentleman is incorrect. I want a fair system based on principle in which need is assessed, and where the money follows the pupil and that need. That is precisely what all of us should want.

Given that the Government have set out, in a transparent way, how to bring about this fairer funding formula, the suggestions that have been made are for political purposes; I know there are elections for London Mayor tomorrow. The House should rise above that. If the details come out and they are found not to fit with the principles, they will be worthy of criticism, but right now, such criticism cannot be made. When we have a badly broken system, the failure to demonstrate how it should be changed is not good enough.

What we should be talking about now is what emphasis we want to be placed on deprivation, for example, or population movements. Those things are all reflected in the proposed formula. The Government have touched on all of them. I do not see how it is acceptable to say, “We have a problem with a lot of people for whom English is a second language”, when that features in the formula. It is the same with deprivation needs in London—that, too, is in the proposed formula. The truth is that we have the ingredients for a fair system.

[Ian Mearns (Gateshead) (Lab)]

rose—

[Graham Stuart]

I give way to my extremely experienced and knowledgeable north-eastern colleague.

[Ian Mearns]

I am grateful to the hon. Gentleman. There are many different facets to the differential funding around the country, and one of them is the historical choices of the relevant local authority. We used to have what was called the standard spending assessment, and some authorities chose to spend above the standard level. They funded the extra out of local taxation, which was built into the funding taken forward into the current distribution. It is one part of many facets, but it is a crucial part.

[Graham Stuart]

As ever, the hon. Gentleman makes an interesting and well-informed point. Westminster has been mentioned, so let us look at that as an example. People in very expensive properties are paying council tax rates that are absolutely on the floor; their rates should be compared with those paid by my constituents living in homes worth a tiny fraction of the value of those in Westminster to see how much more those constituents are paying.

It does not wash to suggest that a fairer funding system is undermined because people paid more or less council tax in the distant past. The truth is that there are very high levels of council tax in many of the areas, including my own, that have the lowest funding, while there are very low levels of council tax in some of the richest and most prosperous parts of London. What we need is a system that is fair to all.

[Ian Mearns]

rose—

[Dame Angela Watkinson (Hornchurch and Upminster) (Con)]

rose—

[Graham Stuart]

I give way to my hon. Friend.

[Dame Angela Watkinson]

Does my hon. Friend agree that property prices are an element in the formula that must be taken into consideration, particularly in areas such as the London Borough of Havering, which is right on the outside of outer London? Teachers there are paid the outer London allowance, but property prices are very high. Often newly qualified teachers who apply for jobs in our schools find that they cannot afford the accommodation, so they then move inwards towards Barking, Dagenham and other nearby boroughs where the properties are a bit cheaper.

[Graham Stuart]

My hon. Friend is absolutely right. There are all sorts of boroughs across London, and some areas are funded to the tune of tens of thousands of pounds less per classroom than one that might be just a short distance away, yet they are in exactly the same market for teachers—the vital ingredient for raising educational standards. Despite that, when it comes to improving standards, outer London has been part of the London educational transformation.

The suggestion that moving from a situation of gross inequity to one that is fairer to all will undermine quality, when those who have suffered that inequity, such as the constituents of my hon. Friend the Member for Hornchurch and Upminster (Dame Angela Watkinson), have none the less managed to improve standards, proves that the issue is not just about money. The money needs to be distributed fairly.

I think the most important thing we should do today as a House is to say that we want a system that is fair to all. We should be discussing the principles and ensuring that the Government do not wriggle on any them for their own partisan or other interests. That is quite right, but let us not scaremonger. Let us not send out messages about dividing communities when the aim of fair funding is right and supported by everyone—including the Labour, Conservative and other major Front-Bench teams. I shall end there.