Academies Bill [HL]

Lord Knight of Weymouth Excerpts

Tuesday 13th July 2010 Lords Chamber

[Baroness Walmsley]

There are indeed many complex issues to be further explored and I am sure that this will be done in another place. This morning I briefed my honourable friend Dan Rogerson MP, who will be handling the Bill on behalf of these Benches in another place, beginning on Monday.

One of the complex issues, for example, is that the amendment of the noble Baroness, Lady Wilkins—the spirit of which we certainly support—does not explain how the money retained centrally can transfer to the academies. Is it the expectation that a local authority will make the provision in an academy? Can the Minister confirm whether a local authority will have physical access to an academy to ensure that provision for low incidence SEN pupils is satisfactory? After all, it is being asked to pay directly for that provision.

[Lord Knight of Weymouth]

In the conversation that the noble Baroness had with her group in the other place, was it discussed whether any amendments will be allowed by the Government? Given the tight timetable of Second Reading and Committee stage on the Floor of the other place in the same week, it looks as though the Government want to get this Bill on the statute book before the Recess; therefore there will be no amendment because there would not be time for it to come back here.

[Baroness Walmsley]

I understand the point that the noble Lord, Lord Knight, is making, but I did not discuss that matter with my honourable friend. After all, the procedure at the other end is not a matter for a Member of this House; it is entirely for the other end.

On statementing, the general duty on local authorities to ensure that appropriate children are statemented is not within the scope of the SEN obligations. It is a discretionary matter for academies as to whether they put forward children for statementing. Therefore, on one view, children in academies might be disadvantaged; on the other hand, the likelihood is that academies might overpresent children for assessment for statements—but this, of course, has its own problems.

That the noble Baroness, Lady Wilkins, has felt it necessary to table this amendment again highlights the fact that many noble Lords are still not satisfied that the mechanism is fair and transparent for calculating how much extra funding goes to the academies and how much will remain with the local authorities to enable them properly to carry out their duties in relation to the children in maintained schools.

In Committee, the noble Lord, Lord Hill, accepted that these arrangements must be seen to be fair and undertook to,

“reflect on the underlying principle of making sure that there is transparency and trust in these arrangements”.—[Official Report, 23/6/10; col. 1333.]

The ready reckoner on the department website has a lot to answer for and the funding mechanisms are clearly a work in progress. We have suggested that someone needs to take an independent view that these arrangements are fair to children in and out of academies. However, because of the rules on Third Reading, we were not allowed to table amendments containing further ideas on how this might be done.

We are not convinced that the YPLA is up to the job and remain concerned about this matter. As I said earlier, we have briefed our colleagues in another place, who will now have the opportunity to explore these issues further. The Government have time to get this right and we on these Benches hope that they will do so.

--- Later in debate ---

[Lord Phillips of Sudbury]

My Lords, I am most grateful to my noble friend for listening to the arguments advanced at the previous stage, with which I was involved, and for bringing forward the new provisions that meet satisfactorily the matters concerned. There is just one point on which I would be obliged for his assurance. Some noble Lords will find that the wording of subsection (1) of the proposed new clause, although it mirrors the new consultation clause, still appears somewhat subjective, requiring the people promoting the new or additional school to,

“consult such persons as the person thinks appropriate”.

It would be helpful to have in Hansard an assurance from the Minister that, in considering the impact of a new or additional school on other schools under the new impact clause, the Secretary of State will have to take a view as to whether the consultation undertaken by the promoters of the new school is adequate and sufficient in order for him or her to come to a view on whether the impact is on the right side of the line.

As I say, I hope that the Minister will be able to assure the House that, if the Secretary of State considers that the consultation undertaken by the promoters is simply not adequate to establish whether the impact is on the right or wrong side of the line, he or she will be able to undertake further consultation as will lead to the facts that he or she must have in order to reach a proper conclusion on impact.

[Lord Knight of Weymouth]

I pay tribute to the Minister for ceding the principle around the impact of additional schools. He has listened to the House and we are grateful to him for that. Like the noble Lord, Lord Phillips, I pay particular attention to Amendment 7 and the phrase,

“a person must consult such persons as the person thinks appropriate”.

Given the excellence of the people drafting the clauses, I am sure that that is perfectly sound technically. However, it is wide in its effect. I would argue that in the case of additional schools, in particular, we have to include in that consultation the local authority and possibly the schools forum. I ask the Minister to commit to amending the Bill in the other place, particularly as he already may need to do so. If he does not like the amendment agreed earlier, that may open up the possibility that he will agree to an amendment on this.

My concern is around the funding of these additional schools and it may help your Lordships if I briefly explain how the existing funding works. The bulk of schools funding comes through the dedicated schools grant—except for academies, which are funded directly by the Secretary of State. The dedicated schools grant is then allocated by local authorities as agreed by the schools forum, which is made up of schools, pre-schools, further education colleges and other 14 to 19 providers. It is notable that the Minister does not include pre-schools in Amendment 6 and, given that under his policy academies can now include primary schools, which may be providers of pre-school education, there may be an issue about pre-schools not being consulted. However, I shall not dwell on that.

When academy arrangements are entered into, the necessary funding for the academy is taken away from the local authority’s dedicated schools grant and allocated direct to the academy. Additional schools need revenue funding, and that will come from that local authority allocation. That is why it is essential that the local authority is consulted—unless, of course, the Minister has a pot of money for revenue funding. I know that capital funding is allocated and, like other noble Lords, I have been on the web today trying to understand these issues. On the Department for Education’s website I found a press release from the Secretary of State dated 18 June in which he refers to capital funding by reallocating £50 million from the enhancing technology grant to create a standards and diversity fund. However, there is no mention of the revenue funding needed for these new schools.

The frequently-asked-questions section on free schools contains six lines outlining how much funding I will get to run my free school. That remains very vague. It states that,

“we will work with the early groups of Free Schools to develop a sustainable and fair funding model and publish further detail as it becomes available”.

Perhaps the Minister is ready to publish that further detail to help inform the debate today.

Determining the revenue of an additional school requires a prediction of pupil numbers. This then determines both how much the new school will get and how much the other schools will lose because we are working within a constrained pot—unless, of course, the Minister has his pot of gold. Can the Minister tell the House where the revenue will come from in the first few years as the additional schools are established? A modest-sized, virtually unviable, secondary school would have 400 pupils at £4,000 per head per year, which is probably lower than the current average per pupil funding. According to my calculator, that is £1.6 million of revenue funding per school in its first year of operation. We need to know where that money is going to come from.

Who agrees the predicted number of pupils for the additional school? That will have an impact on the surrounding schools because they will then know how many they are likely to lose. What form of appeal will there then be for those schools, the local authority and the schools forum, which advises on the detailed allocation to each school? What form of appeal will they have on the decision on the predicted number of pupils? Has the Minister taken legal advice on whether the current process that we are being asked to agree today is challengeable if there is no consultation with local authorities or schools forums?

[Lord Willis of Knaresborough]

I apologise to the noble Lord but I am trying to get the parlance correct. It would be helpful if he would explain the funding arrangement under the previous Government when a new academy came into a local authority area. How was the money clawed back to balance the places and resources?

[Lord Knight of Weymouth]

The noble Lord will know that academies have been used to replace failing schools, so there is a fundamental difference in the policy reflected in this Bill. We are being asked to agree arrangements for academies to convert from outstanding schools and, in this case, we are discussing additional schools. There are one or two additional schools for which my noble friend sitting next to me, or I as the Minister responsible, might have been able to find the additional money. That is why I keep asking the Minister whether he has some revenue funding that he has not told us about and whether he has agreement from the Treasury. In these straitened times that is unlikely, so it is most likely that it will come from other schools in the local authority area.

Is the Minister aware that following the unfortunate Building Schools for the Future announcement, there is a considerable appetite among local authorities to take legal action against his department when things are rushed out without working through the details? That is what is happening because of the unexplained desire to get the Bill on the statute book this month.

I know that I have asked the Minister a lot of questions, and he may want to write to me with some of the answers. Since I raised it in this Chamber last week, I would be most grateful if he could explain in his summing up how revenue funding will work for these additional schools, and why the Bill does not provide for consultation with local authorities and school forums.

[Baroness Walmsley]

My Lords, I, too, welcome Amendments 6 and 7, and I am glad that the noble Lord, Lord Hill, has responded to the persuasion and effective blandishments of my noble friend Lord Phillips of Sudbury on this matter.

I have a question on proposed new subsection (4) in Amendment 6, which states:

“For the purposes of subsection (3)(a) a school does not replace a maintained school if it provides education for pupils of a wider range of ages than the maintained school”.

Will the Minister explain that, because it is not covered by the letter which he wrote about the government amendments of 9 July 2010? I think it means that it excludes from consideration as an additional school an academy that decides to establish, for example, a sixth form that did not exist before. I would not want this part of the Minister’s amendment to work as a loophole that would allow schools covering substantially the same age range, but with a little tweak at one end or the other, to be established without the Secretary of State having the very serious job of considering the impact on other good schools in the area.