Enterprise and Regulatory Reform Bill

Neil Carmichael Excerpts

Wednesday 17th October 2012 Commons Chamber

[Mr Wright]

We can consider that when hon. Members debate new clause 25. We had considerable debate about it in Committee. The question now is: what is the purpose of the green investment bank? Is it to ensure that we can kick-start innovative technologies that cannot have market buy-in, or is it a question of ensuring that the targets set out in the 2008 Act are met? There is a conflict there, which we considered in Committee at some length. I think that there is potential to consider nuclear, certainly in respect of the nuclear supply chain and ensuring that we can achieve these objectives. I am keen to hear the debate on this matter in the next few moments. It is important to probe the Government on whether this is an appropriate avenue for the bank to invest in.

[Neil Carmichael (Stroud) (Con)]

rose—

[David Mowat (Warrington South) (Con)]

rose—

[Mr Wright]

I shall give way to two eminent members of the Public Bill Committee, but I must bear in mind the fact that we do not have time to debate these issues at length.

[Neil Carmichael]

I thank the hon. Gentleman for that generous introduction. I am glad I stood up when I did. The danger of the shadow Minister’s speech so far is that he is focusing on energy, where, of course, a green investment bank should be considering many other technologies and many issues other than energy. That is one of the problems with new clause 22.

--- Later in debate ---

[Mr Wright]

My firm policy commitment is to ensure that we have the green investment bank borrowing as soon as possible, as a stimulus to growth. We were mindful of amendments that we tabled in Committee about that, but we also have to consider the appalling financial mess that the Government are dealing with in respect of increased borrowing. Borrowing was going down prior to the general election, but now it is going up. We do not know what the circumstances will be in 2015, so we need to ensure that there can be certainty, based on the imperative to have the green investment bank borrowing from the capital markets as soon as possible while being mindful of the need for rigour and discipline in the public finances.

[Neil Carmichael]

Is it not possible that the green investment bank can encourage other private organisations and banks to step in and start contributing to the green economy, as that is really what this is all about? It is about providing the right confidence, on the basis of a framework of some certainty, which the Minister has asked for and the Government are giving.

[Mr Wright]

Absolutely, and that is why the hon. Gentleman will be supporting our amendment 77 and rejecting Government amendments 1 and 3.

If our economy has sectoral strengths, it is right, in an active industrial strategy, for the Government to be looking to maximise those strengths. They also need to seek to develop further capabilities, as the hon. Gentleman rightly said, that could lead to greater investment, growth and employment opportunities here in the UK and, we hope, to the exporting, for commercial gain, of some of the work, expertise and capability here. We want economic benefits to flow to companies within the United Kingdom. That is not to defend protectionism, or to deny the need for competition and foreign direct investment, but to ensure that the Government, as part of a fundamental, active, industrial strategy, work with business to see how this country can gain and maintain market advantage.

[Neil Carmichael]

rose—

[Mr Wright]

I cannot resist giving way to the hon. Gentleman again, even though I am conscious of the time, because the manner in which he puts his hand up as if he needs to go to the toilet is so endearing.

[Neil Carmichael]

I thank the hon. Gentleman for that. It is important to understand the length and complexity of supply chains and that we do not tie ourselves down to thinking that the supply chain is just within Britain, as it goes further than that. We need appropriate co-operation from the supply chain in big operations. The Government are rightly focusing on supply chains more generally, but we need to bear that in mind.

[Mr Wright]

Absolutely. I think the hon. Gentleman can go to the toilet now. Recent research has concluded that capital expenditure costs for something as important and significant as offshore wind projects, in which my constituency could play a leading part, could fall by a third in the next decade if a greater proportion of the parts were made in the UK. We need to be mindful of that and the Government must work with business to enhance the supply chain possibilities, opportunities and capabilities in the UK. I suggest to the hon. Gentleman, with the greatest of respect, that that is not happening, largely because of policy uncertainty. That is what amendment 77 is designed to address.

Enterprise and Regulatory Reform Bill

Neil Carmichael Excerpts

Tuesday 16th October 2012 Commons Chamber

[Mr Wright]

My hon. Friend is absolutely right. It is important that the House and the country has 28 April—workers memorial day—as a focus for remembering that people should not go to work and not come back, and that families should not be disrupted by death and injury at work. We need to pull together to ensure that health and safety is considered not as peripheral and a nice thing to have, but as central to our society and a productive economy.

[Neil Carmichael (Stroud) (Con)]

rose—

[Mr Wright]

If the hon. Gentleman will allow me, I will move on.

There are benefits to business from an effective and proportionate health and safety regime. As I mentioned, a safe and healthy work force can be a productive and effective work force. The Institution of Occupational Safety and Health estimates that, by having an effective health and safety regime, employers could save up to £7.8 billion, individuals could save up to £5.12 billion, and the economy, each and every year, could save up to £22.2 billion. It is important that health and safety is classed not as unnecessary and bureaucratic, but as conducive to good, effective and sustainable economic growth.

It is with those figures in mind that we should consider the merits of health and safety regulations and legislation, and the long-established premise of strict liability. As we know and as the Minister said, Professor Löfstedt reported in November last year. My right hon. Friend the Member for East Ham (Stephen Timms), who speaks for the Opposition on health and safety, welcomed many aspects of Löfstedt’s review. As my right hon. Friend said, most of it was positive, sensible and evidence-based, which is not a phrase we have heard often in deliberations on the Bill, and reinforced the view that health and safety is not a burden.

Over a number of years, the Health and Safety Executive has undertaken simplification exercises, which had support from both trade unions and employers. There are 46% fewer regulations than 35 years ago, and there has been a 57% reduction in the number of forms used. There is a perception that firms, and particularly small firms, spend disproportionate time on health and safety to the detriment of business and growth, but the average business spends 20 hours and just over £350 a year on health and safety risk management and assessment, according to the Minister’s Department. Such activities therefore do not exactly take up a huge amount of businesses’ time.

Exam Reform

Neil Carmichael Excerpts

Monday 17th September 2012 Commons Chamber

[Michael Gove]

Yes. My hon. Friend makes an important point and we will do everything we can to ensure that the consultation includes not only content but method of assessment and support for teachers.

[Neil Carmichael (Stroud) (Con)]

I welcome the statement, chiefly because it builds on the English baccalaureate, and also because it reflects the important conclusions of Professor Alison Wolf’s report. However, may I stress the importance of ensuring that further education colleges, universities, sector councils and representatives of business communities are consulted, because their views are pivotal? My right hon. Friend will find that they are also supportive.

[Michael Gove]

I am grateful to my hon. Friend, whose commitment to the FE sector is well known. He is absolutely right: no reform of examinations at 16 can succeed unless we listen to the best voices in further education.

Energy Supply

Neil Carmichael Excerpts

Thursday 6th September 2012 Westminster Hall

[Mr Yeo]

I am sure that the Committee is encouraged by the fact that the Minister keeps quoting from our reports. He could not have a better textbook from which to embark on his learning curve. The signal that we would like to see of a strong and stable carbon price is one that has been conspicuously absent from the EU emissions trading system, for a variety of reasons. First, the cap was originally set much too high in phase one, and phase two was scuppered by the recession. It will probably be the latter part of this decade, at the earliest, before we see that strong, stable carbon price emerging, but we will see it eventually. I would be surprised if, by the 2020s, we do not see a stable carbon price. Moreover, if more countries, including some large ones, adopt emissions trading as one of their instruments to address climate change, I suspect that the prospects for that strong and stable carbon price will be greatly increased.

[Neil Carmichael (Stroud) (Con)]

I am listening with great interest to my hon. Friend. My question is about energy storage, to which he has referred a few times. Are the members of the Energy and Climate Change Committee, and indeed the Minister, thinking about energy storage and the technologies involved, including, for example, liquid air? If so, are they considering studying the effect of energy storage on investment and how the impact of energy storage might be calibrated?

[Mr Yeo]

I am hoping that the Minister can enlighten us about that, if not this afternoon then before long. One thing that we as a Committee recognise is that the present system—the market—is not giving enough incentive to companies to invest in energy storage. That is why no investment is taking place. There are a variety of ways in which that could be remedied. However, at the moment the ball is probably in the Department’s court on energy storage, and we look forward to hearing what it has to say in due course.

I will try to make some progress, because I am conscious that my colleagues need to speak in this debate. I will just reiterate the point that I was making before the Minister last intervened. Uncertainty or last-minute unplanned policy changes on which consultation has not taken place—I am happy to point out that such changes might not necessarily come from the Minister’s Department but from the Treasury, as we saw in Budget 2011, which contained changes to the tax regime for oil and gas that had not been consulted upon—are simply killers for investment.

Our Committee’s report urged that there should be diversity in energy supplies. Of course, the size of the role that gas can play in that regard will depend significantly on progress being made on carbon capture and storage. If that facility becomes available, there is a much bigger opportunity for gas. Therefore, we should focus our efforts on CCS as much—possibly more so now—on gas as on oil. Alongside that, however, we also need nuclear. Many of us regard it as a clean and safe technology. We have some anxieties about the progress on new nuclear power stations. EDF appears to be on the brink of making the decision in that regard, but it is not quite over the line yet. The future of the Horizon consortium is still unclear. I say to the Minister that if the only way to get nuclear power stations built in Britain soon is to accept investment from abroad, even from China, with the right safeguards, that is perfectly acceptable. The aim is to get these things under way.

Even if that alternative—investment from abroad—fails, I wonder whether the time is approaching when we should consider another model, in which the Government take the construction risk for nuclear power stations and use their own balance sheet and excellent credit rating, which I pay tribute to the Chancellor of the Exchequer for achieving, to finance the construction stage of a nuclear power station. Then, when it is completed, the power station can be handed over for operation; we can sell it to one of the nuclear power companies. I am just anxious that we may reach next year and find that no one will build under the present policy. I hope that it will not come to that.

Let me turn briefly to renewables. I am encouraged by the price falls that we have seen in technologies such as solar power. I am also encouraged by the further innovation taking place in a range of technologies, including some waste-to-energy technologies, and by the British leadership in non-wind marine technology, such as tidal power and wave power; the Committee has also reported on that technology.

However, I urge the Department to take an evidence-based approach, which the Committee itself has adopted. We must do what we can to protect consumers by rigorously insisting on value for money from renewables. I would love to think that we could get huge amounts of base load power from tidal power, but in practice it is much too expensive at the moment for it to be a big factor.

We must face the facts, however uncomfortable they are to the population. Whenever I mention the subject of onshore wind turbines, I am assailed by hundreds, possibly even thousands, of e-mails, some of which are quite irrational or even offensively pornographic, but never mind. I will not read them out to Members here in Westminster Hall; it would involve using some unparliamentary language. Nevertheless, we cannot avoid the arithmetical fact that at present it is cheaper to generate electricity from an onshore wind turbine than from an offshore wind turbine—or from tidal power or wave power—and it is likely to be so for some years to come. I cannot wish that fact away.

However, I do not suggest that we should impose wind power from wind turbines on any community that does not want them. Any community is perfectly entitled to say that on visual or noise grounds the turbines are too intrusive to be accepted; that view is fine. None the less, we cannot alter the fact that if we ruled out onshore wind turbines completely, the absolutely certain consequence would be to raise the price of electricity for consumers.

Just as we need clarity and stability about policy on generating capacity, we need clarity and stability in the transition process from renewables obligation certificates to feed-in tariffs. We also need clarity about the levy control framework and about what would happen in the event that there is a clash between meeting the requirements of the Treasury, in terms of the framework, and meeting the requirements of the Government as a whole, in meeting the carbon budgets to which they are committed. All of those issues will have to be answered when the House considers the energy Bill in the next few months. We look forward to being given some clues about the Minister’s attitude towards these issues.

I was going to say a bit more about energy efficiency, but I hope that everybody takes it as read that for our Committee that is the first and foremost priority. It is the one area where the needs of security, affordability and reduced emissions all come together; greater energy efficiency achieves all those objectives.

I am keen that the Minister should have plenty of time to give us the first clue about his thinking on these issues, so I will conclude my remarks now and just say that I hope my colleagues will deal with the other parts of the report that I did not have time to deal with myself.

[Laura Sandys (South Thanet) (Con)]

It is a great privilege to follow my hon. Friend the Member for South Suffolk (Mr Yeo), the Chairman of our Select Committee. As he rightly said, we have been involved in producing a wide range of reports. Subjects such as energy can be quite dry, but every 10 or 15 years, they become the most exciting portfolio across all Government Departments.

I welcome the new Minister to his post, which he takes at a time when energy is perhaps one of the most important and interesting issues that the country faces, with energy security absolutely at the heart of that. I look forward to his first appointment with the Committee, which I am sure will be in the near future.

I also follow my hon. Friend the Member for South Suffolk in recognising the extraordinary work and success of the Minister’s predecessor, my hon. Friend the Member for Wealden (Charles Hendry), who was an exemplary Minister with a reputation both here and abroad. I am sure that the new Minister realises that his post is, in many ways, a sales job. It is about knocking on doors around the world to try to ensure that we find the investment we need, which is close to £200 billion. I am sure that fellow members of the Committee will join me in hoping that my hon. Friend the Member for Wealden has an interesting future beyond the portfolio that he has left.

Energy security involves two competing issues, in that we face a significant increase in energy consumption but, at the same time, a decline in UK production. I do not want to make too much of a political point, but that situation did not arise only yesterday—we have faced it for the past 15 or 20 years, so it has been straightforward to predict. It is unfortunate that we are now racing to try to achieve some policy certainty and reinvestment in the energy sector when it has been quite obvious that we have been facing this problem for many years.

Globally, some would say that the last century was dominated by the politics of ideas. This century will be about the politics of resources. That is what makes the energy security debate so important, because it is about much more than the energy sector. It is also about our future industrial growth, our competitiveness and keeping the lights on, and in a much less benign environment than before. There is demand for energy, food and water from domestic audiences, whether they are in the UK, China, Russia, or even countries where democracy is not necessarily the watchword. For the UK and all these other countries, access to resources will be absolutely crucial and will determine their economic success.

No one is proposing energy independence, but I have a personal experience that illustrates why I am particularly sensitive to the issue of energy security. I worked in the energy sector for about 15 to 20 years. Before I came to this place, I worked for the Georgian Government in the Caucasus, advising them on the Baku-Jehan pipeline. The second time I was in Tbilisi, I came out of my hotel room and saw a man who was not much further away from me than my hon. Friend the Member for South Suffolk is now. Somebody then went up to that man and shot him in the head. That was related to a large energy deal that was being proposed by a Russian company. The Georgian businessman had turned down the deal, and instead of a shareholder meeting, a P45 or any form of renegotiation, there was a murder in the main street of Tbilisi. That might sound unusual to people in Whitehall, but it is not necessarily unusual in parts of the world where energy is politics.

In addition, when I was sitting having a nice meal in Georgia, the lights went out for 20 minutes. It was apparently a message from the President of Russia to the President of Georgia—“Please will you give me a ring?” He gives him a ring, and 20 minutes later the lights go on. The Georgians then turn around to each other and say, “So, we have lost a bit more of our sovereignty.”

Those examples might seem extreme, but this is where politics and resources come together. Although we might not be exposed to the politicisation of energy, the international market will be, and we must clearly understand that the world of benign energy trading might become a bit more difficult.

Unlike for many countries, it will be not the insecurity of supply that we have to address, but the cost of the supply. The cost of volatility in our energy sector will greatly affect the desirability for inward investment into this country. In India, the electricity went down for three or four days, and that was a massive blow to the country’s attractiveness as an investment market. We might not have the actual lights out, but we will have a problem when it comes to cost, and the cost to our industrial base is crucial. As a result, we should be looking for consistency and predictability to the same extent as considering the lowest cost at which we can deliver energy.

What does a secure energy environment look like? I agree with the Chairman of our Committee that it looks like a truly mixed energy economy, because that will deliver us the greatest resilience. We need to consider increased domestic production, because international volatility will be one of the most destructive economic factors for British business. Our domestic production will, of course, include nuclear—I am a great proponent of nuclear, but we need to get the investment profile and environment right—wind, gas with carbon capture and storage, and coal.

[Neil Carmichael]

My hon. Friend makes some interesting points about threats and volatilities. Does she agree that the European single market is a tool that we could extend into energy and thus assist in that area?

[Laura Sandys]

I had an interesting experience with my right hon. Friend the Member for North Somerset (Dr Fox), who has never been known to be a great proponent of Europe. He said in a Chatham House speech before the election—perhaps in 2008 or 2009—that European Union member states should become a co-ordinated and active consumer of energy when it comes to Russia and certain parts of central Asia. I therefore agree with my hon. Friend the Member for Stroud (Neil Carmichael).

To return to the question of a mixed energy economy, new technologies must also play a part in the resilient energy mix, but anyone who thinks that any of the energy generation sources are pain-free is misguided. Planning applications for shale gas, which I have had in my area, make onshore wind farms look like a walk in the park. The cost of nuclear, including de-risking, will be a lot more than the Government think. In many ways, that reiterates what the Committee Chairman said about considering taking on responsibility for build costs.

The wind sector needs to become much more efficient and to understand how to better engage communities. We must recognise that no energy solution comes without some pain. We must not necessarily look to pick winners and losers, but consider how the mixed energy economy needs to be addressed. We all need to appreciate that opportunities are not simple and straightforward.

The Minister faces an interesting in-tray. Energy security will be achieved through a range of Government policies, although sometimes the policies are so complex that they might create competing behaviours. There are capacity mechanisms, increasing market liquidity, which is crucial, storage policies, which were mentioned by my hon. Friend the Member for Stroud, distributed energy incentives, which have not had sufficient profile and enough focus placed on them by the Department, and smart technologies. A range of interactive measures can help to reduce wastage, increase productivity and hedge costs. If energy security means anything, we must ensure that we closely consider demand reduction. Our Committee was a bit concerned and rather disappointed that the Department did not include in the draft Bill a significant set of policies on demand reduction. That can be a very exciting win for the UK when it comes to competitiveness and to building a resilient and modern economic base.

In conclusion, I want to highlight a significant problem with the country’s energy security. This reflects something that the Committee Chair said, and I hope that the Minister will be able to resolve it. The issue is policy certainty. Companies are much less worried—strangely enough—about what incentives there are, or about exactly what they feel they will get out of choosing one energy source or another. However, we currently have rhetoric and we have reality. We have a fast track on the low-carbon economy with one measure, and the brakes appear to be put on with another. We have an opportunity to build a really strong economy around our need for energy investment, but we sometimes confuse the investment community about our intentions. Certainty and clarity of direction will offer the Minister the greatest opportunity for success when he travels the world’s energy company boardrooms, selling the UK as one of the most predictable and reliable investment locations in the world.

Safeguarding Children

Neil Carmichael Excerpts

Wednesday 13th June 2012 Commons Chamber

[Neil Carmichael (Stroud) (Con)]

It is a great pleasure to speak in the debate. I want to emphasise the cross-party support by saluting the promotion of the hon. Member for Wigan (Lisa Nandy) from the Education Committee to the Opposition Front Bench. That is a signal that there is wide agreement on many issues today.

I shall make several brief points. First, Professor Munro is right to signal the need for a change of culture and for agencies to work together more effectively. That point was well made by the hon. Member for Rochdale (Simon Danczuk), who was in effect describing agency failure and lack of co-ordination between agencies. He was spot on. He was describing a tragic situation, but Professor Munro’s approach to cultural change and agencies working together is excellent.

Secondly, I salute the fact that the chief social worker is to be appointed. I want to underline the importance of agencies working together by welcoming the fact that both the Minister of State, Department of Health, the hon. Member for Sutton and Cheam (Paul Burstow), and the Minister present today were involved in the selection of that person. It is necessary for those Departments to work together.

That brings me to my third point, which is that it is critical to start thinking about young people in a continual line, from when they are born onwards. This is to do with the structure of the Department for Education. As I have said before, I think that it should be merged with the Department for Business, Innovation and Skills, because people aged 15, 16 and 17 are abused and can find it difficult to express themselves about it. I think that the Department for Education should be bigger and should encompass all those matters.

Last but not least, I want to refer briefly to the social work college. It is imperative that it is established. We have to get the training right. My hon. Friend the Member for Bristol North West (Charlotte Leslie) was spot on in her description of the children whom the Education Committee met. I was horrified to discover that training is preventing proper relationship building between children and the people to whom they signal their complaints. We must get that right.

Oral Answers to Questions

Neil Carmichael Excerpts

Thursday 24th May 2012 Commons Chamber

[Greg Clark]

All Members of the House recognise the need to encourage banks to lend to small businesses. There is some good news; the volume of lending to small businesses in 2011—the latest year for which figures are available—was £75 billion, a rise of 13%, but there is more to be done. With my colleagues in the Department for Business, Innovation and Skills, we are doing everything we can to encourage banks to lend to small businesses.

[Neil Carmichael (Stroud) (Con)]

Will the Minister join me in congratulating Advanced Insulation, a firm in my constituency, which has just won the Queen’s award for enterprise? Does he agree that such firms are emblematic? We need to demonstrate that we are good at innovating and exporting, and that that is the direction of travel for economic growth.

[Greg Clark]

I will indeed join my hon. Friend in congratulating that company. In fact, a record number of the recent Queen’s awards, announced last month on Her Majesty’s birthday, were for small businesses, which shows that this country’s small businesses have a huge amount to contribute to the future success of the nation.

16-to-18 Mathematics Education

Neil Carmichael Excerpts

Tuesday 27th March 2012 Westminster Hall

[Elizabeth Truss]

I will come to that point. It is important to give those who do not achieve maths at GCSE the option to retake that course in a different way between the ages of 16 and 18, so that they obtain a good qualification that will be useful for the rest of their lives. The 16-to-18 age group is particularly important, yet it is where this country has a gap. Those are the people who will go on to study maths, physics, information technology and engineering at university, yet we all know from speaking to businesses in our constituencies about the great skills gap in that area.

[Neil Carmichael (Stroud) (Con)]

I completely agree with my hon. Friend; she makes an important point. Not only does this issue affect those young people who are effectively devoid of an appropriate education, but it is a serious problem for our competitiveness and business. Does my hon. Friend agree that it is imperative that schools and colleges engage more with businesses to understand that gap?

--- Later in debate ---

[Elizabeth Truss]

I thank my hon. Friend for that contribution. Our massive problem with maths causes a lack of social mobility and problems with university access. Students who attend comprehensive schools are half as likely to study maths as their private school counterparts and one third as likely to study further maths, but they are equally likely to study history or English. The problems of social mobility in mathematics and science do not exist in arts subjects, and the Government should consider that when looking at how to improve social mobility and access to university. Many students do not have the choice to study further maths, because only 50% of comprehensive schools offer that option. Given that further maths is needed to study maths or physics at top universities, many people are therefore put out of contention for the opportunities that we would wish them to have.

I am pleased that the Government are taking action. In the autumn statement, the Chancellor recognised the existing problems with maths education for 16 to 18-year-olds and announced that new free maths schools would be set up across the country. I am pleased to be backing one of those schools, the proposed Sir Isaac Newton school in Norfolk, which will take those students who are most talented in maths and science and educate them not only in A-level maths and further maths, but beyond that to pre-U level. Academics will support that school and ensure that students learn the cutting-edge mathematic and scientific techniques that will help them get to the top universities.

My county of Norfolk has a particular problem with maths. Nationwide, 33% of students who obtain a grade of A* to B at GCSE maths go on to study the subject at A-level. In Norfolk, that figure is 25%—a massive gap. We want to improve that situation and get more people studying A-level maths.

The development of the new maths schools is positive, and I applaud the Government for that innovation, which has already been seen in many other countries. However, we need further reform in two key areas. First, we must overhaul the sixth-form funding regime, and secondly—one of my hon. Friends alluded to this—we need more varied maths qualifications post-16.

Unbelievably, for post-16-year-olds, the Young People’s Learning Agency currently awards more money per capita for students studying psychology and media studies than to those studying mathematics. It also awards more money to science subjects—there is a 12% funding premium for all those subjects on top of the amount that is given to the school for maths. The justification for that 12% funding premium is that those other subjects need additional equipment. However, as anyone who has been involved with schools will know, the greatest cost is in teaching resources, rather than equipment.

At the moment, our funding formula is based purely on the amount of equipment needed, rather than the cost of recruiting teachers. Maths is the most difficult subject for which to recruit teachers; there are more vacancies for high-school maths teachers than for any other subject, and schools often end up paying a premium. One school in my constituency advertised for a newly qualified maths teacher. It offered £44,000, but received just one application.

Another school has flown in maths teachers from Canada to fill the shortfall in available teachers. Fewer than half of secondary maths teachers in this country hold a maths degree. We have a massive problem with the recruitment of maths teachers, yet the funding formula means that maths is disadvantaged when compared with science subjects and courses such as media studies, psychology and film studies. Furthermore, because the funding system is weighted towards deprived students, there is an even greater funding differential for deprived students doing media studies, as opposed to deprived students doing maths.

We have a completely topsy-turvy system in which the underlying financial incentives are asking schools to get lower-income students to do subjects such as psychology and media studies, rather than subjects such as maths, which has the highest earnings premiums and is known to result in greater lifetime earnings. We need to turn that system upside down. We need a subject premium based on the value of mathematics. I have illustrated why mathematics is a particular case and why reform is needed urgently. We are seriously suffering in terms of international competitiveness because we are not delivering enough mathematics capability.

I suggest that through the YPLA mechanism that I mentioned, mathematics should be given a 30% uplift. That would deal with some of the teacher recruitment issues. I would like further mathematics to receive a 50% premium, so that we can increase the number of state schools that offer further maths from the currently very low 50% and so that all sixth forms eventually offer that important option. That will ensure that every child in this country has the chance to go on to study maths or physics at a top university or, indeed, subjects such as computer science—we also need more people in those areas. What I have suggested would give schools a strong incentive to offer those subjects, and I do not think that it would cost anything additional from the education budget.

At the moment, under the YPLA funding regime, we have a huge range of weightings. Some subjects are rated up to 1.7. Those are not A-level subjects but some of the vocational subjects. We are talking about rebalancing the incentives in the system, so that those subjects that will deliver most for our economy and for the students and in which teacher recruitment is hardest get a premium. At the moment, we have the opposite situation.

I would also like to see a greater number of maths options post-16. Current participation in A-level maths and further maths is heavily weighted towards those gaining an A* at GCSE: 73% of students who get an A* in maths take an A-level in it, but only 6% of those who get a B do so. The number is much lower than for other subjects. One quarter of those who get a B in English and one fifth of those who get a B in history go on to do those subjects at A-level. The reason is that we have a one-size-fits-all maths and further maths course, rather than having different options for young people who will go on to study different subjects.

[Neil Carmichael]

My hon. Friend is making excellent points, but I want to probe the question of further education colleges. They, too, need to have appropriate provision in maths, because a large proportion—almost 50%—of all post-16s go to FE colleges, and we do not want them to miss out, either.

[Elizabeth Truss]

I thank my hon. Friend for his intervention. To clarify, the funding to which I am referring applies to both FE colleges and sixth forms. It is a single funding pot that applies to the whole lot. Indeed, recently the Government levelled the playing field between FE and sixth forms. The plans that I am talking about would apply to both FE colleges and sixth forms.

For 16-to-18 maths, we need a range of tiers in which some options are harder than others. The Sunday Times reported at the weekend that Sir John Holman is drawing up plans for what those options would look like. When we are drawing up the options, we need to consider the failings of previous attempts to create different maths options for those aged 16 to 18. I am referring specifically to the use of maths A-level. It purported to provide real-world experience, but leading Fields medallist and Cambridge maths professor Tim Gowers said:

“it is blindingly obvious from the sample papers that it is not testing different skills…and is deeply boring, and not even all that relevant to the people who are actually taking the exam”.

The problem with use of maths was that, first, it was laid out as equivalent to A-level maths, which it simply was not. Secondly, it attempted to be relevant, but not in a way that could be applied to the real world.

What is needed is a decent set of qualifications, all of which are rigorous. They need to be on a scale, so that people know exactly where they fit in the qualifications framework. I suggest that that would involve, first, an option whereby students learn the basics of maths. Secondly, they learn the intermediate techniques that support arts and social science subjects. Finally, they get the advanced maths that can lead right through to a technical career.

One of the important elements is that further maths needs to be more advanced than A-level maths. Under the previous Government, there was an effort to make those two subjects equivalent on the ground that all A-levels had to be equal. That is clearly nonsense. We clearly need an option for more advanced students to study, so that those going on to do sciences and social sciences have a mainstream A-level option. Let me suggest an outline for the framework. A-level maths should be a strong preparation for university. We should have a slimline version for those who are majoring in social sciences. Maths should be a core part of the apprenticeship programme. I have recently met apprentices in my constituency who have told me how useful they find studying top-up maths to be in completing their courses and gaining skills on the job. There should also be a new course that provides a fresh approach to the basics for those who have failed to get a GCSE grade C in maths.

All that needs to happen fast; there is a case for dealing with it urgently. We need a sixth-form funding formula that puts a subject premium on maths, rather than the subject discount that we have at present, which has caused a very low take-up of A-level maths. We also need to ensure that there is a full offer for 16 to 18-year-olds. That would have a dramatic effect on take-up, and I urge the Government to act on it as soon as possible.

Services for Young People

Neil Carmichael Excerpts

Thursday 22nd March 2012 Westminster Hall

[Neil Carmichael (Stroud) (Con)]

I apologise for arriving late for this debate [Interruption.] It was outrageous. We should always arrive on time, but I have a very good excuse: I was meeting a contingent of young people from Stroud high school in my constituency, who are involved in fundraising, and are doing a lot of thinking about the role of Oxfam. That, ironically, is a good example of the kind of thing that young people should be involved in. I applaud the girls from the high school for doing what they have got in mind. They have been raising a huge amount of money through cake stalls, footprint contests and so forth. They are doing so because they want to be part of the community and are endeavouring to become responsible individuals, and because they think carefully about the world beyond their habitat. That is fantastic, and their example and commitment to some extent underpin what I shall be saying in my brief remarks.

It is an honour to follow the hon. Member for Wigan (Lisa Nandy) who made a thoughtful exposition of the situation, coming from the huge experience she brings to the Education Committee. We all derive value from that, and it is great that so many members of the Committee are here. I think that half of us are present.

[Mr Graham Stuart]

More than half.

[Neil Carmichael]

More than half; that is fantastic. We work well as a team and are very effective, coming up with some useful reports. I have voted against only one report so far, which was on the English baccalaureate. We had a lengthy process to discuss whether we should support the Government’s proposals, and I disagreed with the whole thrust of the report. I noted that although the evidence we had in support of its conclusions was persuasive, we nevertheless should not stop thinking beyond its remit.

[Mr Stuart]

I just wanted to applaud my hon. Friend for his courage in acknowledging that the evidence was all one way, and his conclusion was entirely the other.

[Neil Carmichael]

I am grateful. I am not entirely sure whether I can describe that as a compliment to my position, but there is much more evidence out there that we should be mindful of. That is what I shall talk about. I referred to the E-bac report not because I wanted to ram home yet again the fact that the Government are absolutely right to introduce the E-bac—they know that, and most people are beginning to realise it—but because there is more to our thinking on youth services than is contained in our report.

My other more general point is that it is absolutely right that 80% or 90% of young people’s time is spent in activities other than schooling, but we must get our education system right. That must be the top priority, and public money must be allocated on the basis of priorities. I want to make it absolutely clear right now that my priority is to ensure that our children receive an education that will equip them to deal with the challenges facing them and the opportunities and lifestyles that they wish to pursue. That is a cornerstone of my contributions to the Education Committee.

A key theme of the evidence that the Committee received in our various meetings showed that the picture is extraordinarily mixed, and it was difficult to analyse outcomes, and to elicit clear messages. In broad terms, the range of providers, the complexity of provision, and the different priorities that many providers had, made it extraordinarily difficult to make a judgment about outcomes and processes. That must be properly understood in the context of expenditure levels and the way in which the Government have reacted to the challenge of the pressures on public expenditure.

My constituency has a huge number of youth providers, and not all of them would be recognised in the context of the Committee’s report. We must acknowledge and salute those organisations that provide a huge amount of good value for our young people, and which would not normally come within the remit of our discussion today. For example, the Door project in Stroud provides fantastic support for young people who have been let down by everyone, including in most cases their own parents. The project is supported powerfully by the local community, delivers outstanding outcomes, and is a strong and useful part of our community. It is a good example of the sort of things we need.

Nailsworth has a community workshop, which I visited not long ago, where young people can learn about crafts, and to be craftspeople. It is fantastic, and is growing up from our local community. Not far away in Nailsworth is a youth centre that is very well supported by the town mayor and many others. It has been the victim of cuts by Gloucestershire county council, but nevertheless continues to deliver fantastic services that are really worth having.

In Dursley, another key town in my constituency, the Lower King’s Hill management co-operative provides great opportunities for young people to do all sorts of things, including gardening and so on. It is also where I hold some of my surgeries, so I am connected with its work, and its aims and objectives. It is yet another example of the sort of structure that we should be supporting, but which might not be covered by our report.

With that degree of diversity, we have some great structures, and I have not even started talking about some of the others, such as Outreach, which provides support for young people in very difficult circumstances. The staff’s dedication to young people, and the opportunities that they gain because of the support, framework, comfort and succour that they receive is fantastic. I applaud that.

All the organisations that I have mentioned are well supported by local people in their local communities, because they recognise local needs and work extraordinarily hard to produce outcomes that are surprisingly easy to measure. As a Member of Parliament, I visit them all, and I see the outcomes and am impressed. What often worries me is the number of people who need those services, rather than the outcomes. We must not ignore the fact that many good things are happening in our constituencies. Mine is a good example, but I think all hon. Members can say the same.

[Tessa Munt (Wells) (LD)]

I agree broadly with my hon. Friend, but in my constituency in rural Somerset, one difficulty is acute travel problems. The complete lack of transport services after 6 o’clock in the evening means that only children with parents who have access to a car can access youth services. Not every village has a youth service. I have 172 communities in my constituency, and there are probably youth services in nine or 10. I accept what my hon. Friend says, but it is almost intolerably difficult for young people to access services in rural communities if other services are not in place, and my county council is cutting everything.

[Neil Carmichael]

I thank my hon. Friend for that comment. She is absolutely right that people must be able to get to facilities. In constituencies such as hers and mine, where there are many villages, transport is a factor. My son is a member of Rodborough Eagles, a football team that does extraordinarily well. He is a much better footballer than I ever could have been because he is not flat-footed and is a really good defender. The key point is that he visits many different parts of my constituency, and I join him as often as I can. That football club is a youth service, and an option for him and his friends to enjoy, and is part of youth service provision. A variety of different services can be tapped into.

[Mr Stuart]

My hon. Friend is right. It is important when considering statutory services, which have an important role to play, as I said during my speech, to remember that there is a vast range of other services, such as sports clubs—Beverley rugby club, Beverley cricket club, the Meridian gym, which my younger daughter attends, and the Eastside gym which serves more than 700 children at Hedon in my constituency. I pay tribute to people such as Andy Dickinson and Steve Crane who do such a good job of providing services on a voluntary basis.

[Neil Carmichael]

My hon. Friend the Member for East Hampshire (Damian Hinds) is wondering whether he can read out a list of places in his constituency.

[John Robertson (in the Chair)]

Order. Can we get rid of references to individual places?

[Neil Carmichael]

My hon. Friend the Member for Beverley and Holderness (Mr Stuart) is absolutely right, and his point is central to the matter. We should not think that youth services are just about statutory provision, because they are not. They are all part of the big society, which is encouraging many villages in my constituency to start thinking about providing the services that people need, including youth services.

I think that I have made my point about the rich variety of facilities, clubs, sports clubs and so on with which young people can get involved, and about the powerful role played by charities in providing facilities.

[Damian Hinds]

Before concluding his remarks, perhaps my hon. Friend will touch on the provision made by what these days we call faith communities and in the old days used to call Churches. There is an ongoing debate about the role of Christianity and other faiths and religions in public life, and a lot of churches provide important youth facilities that often are not restricted only to members of one particular denomination. The King’s Arms in Petersfield is one such example—

[John Robertson (in the Chair)]

Order. We are talking about the Select Committee report, and although it may be nice to mention every group in the hon. Gentleman’s constituency, I doubt that we have got time for them all.

[Neil Carmichael]

Thank you, Mr Robertson. Your point is absolutely right, but it shows that we can think of more examples than just the evidence provided by the Committee.

My hon. Friend the Member for East Hampshire is right about Churches. My father used to take me to Sunday school, and I thoroughly enjoyed the first bit. I have remained a member of the Church of England for some time, and I look forward to a life of such membership. My own children had a similar sort of arrangement. Church organisations play a part in providing great facilities for young people, and I have seen that in action.

We are in danger of labouring the point, although I think that it has been well made. I am therefore going to move on to the point raised by the hon. Member for Wigan about the national citizen service. As she said, we went to Germany and looked at the range of options that were available for young people. We noticed first that a huge number of young people were participating in Germany’s equivalent of our national citizen service, and that to a large extent the activities were work based. That is the essential reason why, broadly speaking, the programme costs just over £1,000 in Germany for the year, but about the same in this country for a number of weeks. That is the big difference between the German system and the fledgling system in Britain, and the German system has a number of noteworthy advantages.

First, the work-based nature of the programme chimes well with the emphasis that is put on training and education in Germany, and the relationship that has with employers and professional activities. We need to embed such an attitude to education and to what happens afterwards in our own culture. It was obvious to me that the schemes that we saw in Germany provided a strong continuity from education to employment, and we should learn from that.

The second interesting thing that I noticed in Germany was the consistency of the youth programmes. We visited a fire station just outside Berlin, and there was a continual throughput of young people. Young people had to make a choice, but they knew what those choices were before they had to make them. From that, I gleaned that young people were able to think about what they were going to be doing outside and immediately after school. I thought that that was really encouraging; the experience of working in that fire station meant being part of a large team with awards, presentations, pictures and so on. Such things demonstrated that people had been there and benefited from being there, before going on to do something else that was the right step in their career development. Those who were starting the programme could see the results and the beneficial outcomes.

Those are the differences that I saw between the German system and the national citizen service. That did not stop me, however, from writing to local secondary schools in my constituency to remind them of the value of the NCS, and to make sure that they informed their students about getting involved in the schemes provided by the NCS. I hope that students get involved in the programme, but if the NCS is to continue in the long term, we must learn one or two of the lessons that I have just mentioned. It is imperative to provide the schemes that we propose with a sense of continuity and worthiness.

Too often in this country we end up putting things into silos. We forget that most things are linked and that most policies are not dependent on the work or delivery of one Department, but that there are connections between Departments, agencies and other structures. The provision of youth services is a good example. What matters is not only the budget provided by the Department for Education, or wherever, but the overall Government approach and the links between various policies—including the Work programme, for example—as well as what we do in and expect from our schools, our objectives for social services, employment opportunities, and so forth. That is why it is dangerous to rely only on the evidence that we are given. At times, we have got to think slightly beyond that, and the provision of youth services is one such example. That is why the Government are sensible in encouraging other things to happen, rather than just the statutory provision.

--- Later in debate ---

[Pat Glass]

I agree. In my constituency at the moment, 12 young people are chasing every vacancy. However, I want to look back to what mass unemployment causes and to look at what we will face in the future. I see people in my constituency who do not work. Their parents did not work and in all probability their children will not work. They place no value on education. They see schools as convenient baby-sitting services when their children are younger, but have no interest in whether they attend school when they are older. They have no investment in the present and no hope in the future, and they certainly do not vote.

However, the situation was not always as I have described. In communities such as mine before the 1980s and the early ’90s, those people had work. They worked in steelworks, in mines and in all the industries surrounding those big beasts, but all that has gone and we have not put anything in place for them. The cycle of depression and waste is costing the country billions of pounds, and it starts with youth unemployment. Depressingly, I can see the cycle beginning again.

As a member of the Education Committee, I was therefore very keen that early on we should take a look at services for young people and particularly services targeted at vulnerable and challenging young people. As we have heard, the Select Committee examined those services, particularly in the context of rising 16-to-19 participation in education, and we found several issues that worried us greatly, not least the major cuts in youth services and careers services.

We made a number of sensible recommendations, based on the evidence that we heard. We did not think that the Government response was adequate. I hope that the Minister can make a better showing today. In response to the Government response, we highlighted our recommendations again. We are looking for an endorsement of the outcomes framework. I know how hard it is to focus Governments on outcomes. That is very difficult for Governments. I could entertain hon. Members all afternoon with accounts of the attempts that various Governments have made to focus on outcomes and that have gone wrong.

However, we think that it would be worth while for the Government to consider an endorsement of the outcomes framework. We have recommended that the Government set out the grounds on which they will judge a local authority to have failed to provide sufficient services for young people and the ways in which Ministers will act to secure improvement, so that it is clear across the piece, for local authorities and for young people, when local authorities have failed to deliver services and what Ministers will do to secure improvement.

We underlined our finding that some local authority youth services had already closed and urged Ministers to intervene before it was too late. We told the Government that it was not good enough to dismiss our estimate of public spending on youth services, which is based on their own figures, and demanded that they provide us with their own assessment of annual public spending on youth services for each of the 10 years before introduction of the early intervention grant, so that we and others can see clearly exactly what has been spent on young people’s services in the past, what is being spent now and what is being cut and where. We raised concerns—we have discussed this already—about the potential impact of charging for the national citizen service and the impact of the NCS on youth services generally.

Most of all, we highlighted the fact that services for young people—education funding, careers services, youth services and home to school and college transport services—were at risk. Indeed, some were disappearing before our eyes—some as a result of direct Government cuts and some indirectly, through cuts to local authority funding.

[Mr Clive Betts in the Chair]

Like the hon. Member for Grantham and Stamford (Nick Boles) and the Chair of the Select Committee, the hon. Member for Beverley and Holderness (Mr Stuart), I spent six weeks serving on the Committee considering the Bill that became the Education Act 2011. In fact, I think that we spent about eight weeks together; we entertained one another for eight weeks. The hon. Gentlemen will remember, as I do, that the Minister for Further Education, Skills and Lifelong Learning gave an undertaking when we made it clear to him that day that careers services were disappearing. He said that he would take action “imminently”. When we asked what “imminently” meant, he said that it would be when he left the room. However, despite his good intentions, what has happened on the ground is that careers services have disappeared.

I go into schools all the time. The responsibility has been transferred to schools, and when I ask schools what is happening with careers services, they tell me, “Oh, Miss So-and-so does it as part of PSHE”—personal, social, health and economic education—or that sixth formers have access to support when filling in UCAS forms. That is what careers services for young people in schools today have been reduced to. It is simply not good enough.

Youth services—both universal services and targeted services for vulnerable young people—have been cut or have disappeared. My hon. Friend the Member for Wigan (Lisa Nandy) gave a very good description of how that is happening. There have been job losses in these services, with specialist, experienced, difficult-to-replace staff leaving. I have some experience of having to replace specialist staff after a specialist service has closed down, and it is not easy. Those people do not hang on the backs of doors; they are highly qualified, flexible and often mobile. They are hard to train and incredibly hard to replace.

Doug Nicholls, of the union Unite, has estimated that some 3,000 specialist youth service staff face losing their jobs and 20% of youth centres in England and Wales are closing down. My hon. Friend the Member for Westminster North (Ms Buck), when she sums up the debate, will give more details on it, but she has made this estimate:

“A massive £200 million worth of cuts will have been made to youth services by April this year hitting young people and damaging chances of getting the economy back on track.”

All that has happened not just because of the cuts in services, but because the ring fencing around these services has been removed. That has hit young people living in Tory and Liberal Democrat-run council areas the hardest. Research shows that 60% of Tory and Lib Dem councils are making significant cuts to their youth services, whereas Labour local authorities, which are often those facing the greatest cuts in their funding, are at least targeting that funding at those whom they consider most vulnerable and are seeking to protect services for young people. That means cuts to youth service centre hours and sometimes closures. Less help is being given to young people through useful activities that lead to work and training and away from negative influences leading to crime, alcohol and drug abuse and gang involvement.

In my constituency, the local YMCA in Consett, which does tremendous work, often with the least able and most challenging young people, is struggling to find funding. Billy Robson, who has run the YMCA for as long as I can remember, tells me that two years ago, he was confident that the YMCA could improve the life of even the most difficult and challenging young person. Nobody knows more about supporting young people than he does.

However, he tells me that he now feels unusually gloomy, particularly about the dwindling opportunities available to the large numbers of young people who are not in education, employment or training. There are a few jobs, but they are usually short-term and sometimes part-time factory jobs. Even then, 12 young people are queuing up for every vacancy. Billy tells me that it is soul-destroying listening to young people who cannot get work. Their sense of despondency goes deeper and deeper. He says that it is the biggest struggle that he has faced since the closure of British Steel in 1980. He wants to be upbeat for the sake of the young people, but when he has to pay off his own staff, on whom those young people depend, it is hard to be positive.

Over the past year, he has applied for about £1 million in funding from organisations such as the Northern Rock Foundation, Greggs and the National Offender Management Service, but has not been successful in any of those applications. He says that because local authority funds have been cut, charities are competing for available private sector money. The Prince’s Trust runs numerous fantastic programmes from the YMCA in Consett that support young people into training and hopefully employment, but the Prince’s Trust seems to be one of the few organisations that have any funding left.

The Government, at a sweep, abolished the education maintenance allowance, which did more to improve 16-plus participation and narrow the gap between the richest and poorest students than any other scheme that I saw in my 25 years in education. To justify abolishing EMA, the Government relied for their evidence on one report, commissioned for a different purpose by a different Government, involving a group of young people, many of whom were ineligible for EMA on the ground of age. The author of that report, who gave evidence to our Committee, was clearly angry about how the Secretary of State had manipulated his figures and his report to justify abolishing EMA.

As a result, 16-to-19 participation has fallen back to levels not seen in this country since the early 1990s. When I asked the Secretary of State about it, he told me that participation had not fallen at all colleges, only at some. It would be good to hear from the Minister exactly where participation by 16 to 19-year-olds has increased. I am not a betting person, but I am happy to bet next month’s salary that participation is up in the south and down in the north, up in the wealthy shires and down in the inner cities and up among the highest earners and down among poor people.

I turn to the Liberal Democrats’ famous flagship policy, the pupil premium. There are probably a couple of dozen education funding geeks around the country, and I am one of them. It was actually quite exciting once I got into it. I know that pupil premium money is not new; it is recycled money. For all its good intentions, it has been recycled from schools with concentrations of the poorest children and young people and siphoned off to richer parts of the country with fewer poor children.

[Neil Carmichael]

rose—

[Pat Glass]

I am happy to give way and to challenge you afterwards on whatever you have to say.

[Neil Carmichael]

I was going to say what a great speech the hon. Lady was making. I was just wondering where EMA and the pupil premium fit in the context of youth services. They are associated more with the question of getting young people into education, keeping them there and supporting the people most in need in the most appropriate way when they are in education.

[Pat Glass]

Given the speech that you just made, I find it difficult that you are asking me to justify—

--- Later in debate ---

[Pat Glass]

The beauty of the education funding formula—it is complex and if we tweak one end of it we cause a huge tsunami at the other end—is that it was locally driven. Each local authority looked at its funding formula and had the opportunity to take into account things such as small schools, rural schools and small areas of deprivation. No one, I think, would accept that it is good to take money away from schools in which more than 50% of the kids are on free school meals and share it out among schools in which only 2% or 3% of the children are on free school meals; it does not make sense and it is certainly not what was intended. The scheme was well intentioned, but it is driving money from those schools that have high concentrations of poorer children and moving it to schools with small concentrations.

Everything that is happening in youth services and careers services, and everything that has happened with EMA, young people’s funding and higher education, where participation from poorer young people from the poorest regions has collapsed in parts of the country because of the tripling of tuition fees—when the Chairman of the Select Committee gave the audience in the Guildhall in York the benefit of the Government’s policy on this, it was clear that people had glazed over and were not listening—has a cumulative effect, and it will take a generation to replace and restore services for young people.

[Neil Carmichael]

rose—

[Mr Stuart]

rose—

Rural Schools

Neil Carmichael Excerpts

Wednesday 8th February 2012 Westminster Hall

[Rory Stewart]

I thank my hon. Friend for his intervention. Perhaps I was not clear enough. The national average of school funding is £5,140 per pupil. Cumbria is in receipt of £4,840, so the point is exactly the one that he makes. If sparsely populated rural areas such as Cumbria are compared with urban areas, we receive less.

[Neil Carmichael (Stroud) (Con)]

My hon. Friend is making an excellent point, and I endorse it by pointing out that we have exactly the same problem in Gloucestershire, where there is the same funding difference between rural and urban areas. Gloucestershire is launching a campaign to put that right, and rightly so.

[Rory Stewart]

I thank my hon. Friend. The point about Gloucestershire is key. There are many reasons why things tend to get bigger, and why small shops give way to supermarkets, small dental practices give way to bigger dental practices, and small schools give way to larger schools. That is partly because of the regulations that we impose on such institutions, and partly because of pupils expectations and the variety of teaching that they can receive. That is difficult to deliver in small schools. When I look out of my window in Cumbria, I see a school in Bampton that had run continuously since 1613, but has had to close because it was considered to be unsustainable. It is an odd world where something that was affordable 400 years ago is no longer affordable when we are spending so much more per capita on our government.

The problem is size, and we have extremes. Samuel King school in Alston has only 161 pupils, making it the smallest high school in Britain. Why should it remain open? It remains open because it is more than 20 miles from Penrith, across a pass that is closed for many days during the winter. One simply cannot get to Alston, which is the highest market town in the Pennines. A school is necessary there, because students would otherwise not be able to get to school at all. Kirkby Stephen has the smallest high school in the country. It has 406 students, but only 70 are in the high school. Its catchment area covers 400 square miles of countryside, and whatever some fantasist would like to do in the name of rationality, that school provides an essential service.

Such schools face difficulties, because the lack of affordable housing, and the limited demographics mean that it is difficult for them to increase their numbers. Kirkby Stephen school breaks even with about 410 students. It makes money with 415 students, and if the number drops below 400, it loses an enormous amount of money, but it has little control over that because its catchment area is so limited in terms of population, although its size is large.

Almost every one of our outstanding schools in Cumbria—those that I mentioned are predominantly rated as outstanding by Ofsted, and are eagerly signing up for the Government’s academy programme—have continual financial problems. They have generally had to be bailed out by the county council year after year, and are in an uncomfortable position. When they become independent as academy schools, the funding they take on is the base level that they received from the county council, and does not include the emergency bail-outs that they received year after year, so they find themselves running up increasing deficits. That is so in Alston, and in Kirkby Stephen, where the debt is approaching £500,000—the £140,000 a year that it used to receive from the county council was discontinued at exactly the time it embarked on its, hopefully positive, future as an academy school.

I want to make two requests of the Minister. One is that we address seriously the issue of the rural funding formula. We should not allow that to be seen as a selfish attempt by sparsely populated areas, such as Cumbria, to steal money from more deserving people. It is consistent with our general attitude towards rural areas, and our general desire that rural areas should not be seen as places that we want to be hollowed out in relation to health care, transport or education. It is a fundamental commitment of our civilisation to rural areas.

My second request, which is smaller and technical, is that I would like the Minister to provide someone from the Department for Education to work with the boards of governors, particularly at Kirkby Stephen and Alston, on their budgets. They have launched themselves to academy status, and they have great governing bodies with great head teachers, but they could do with a lot of help to understand the budget. They are in a difficult situation because they hear one thing from the county council, and another with their new academy status. They need someone to compare their per capita funding with that of other schools around the country, and to provide technical advice on what would be reasonable reductions. That would be of enormous assistance to our schools.

On those two notes, and with acknowledgement to the hon. Member for Copeland, I thank you, Mr Weir, for calling me.

--- Later in debate ---

[Neil Carmichael (Stroud) (Con)]

I did not come to the debate expecting to make a contribution, and I am grateful to you, Mr Turner, for allowing me to do so. I want quickly to refer to several points, which sprang to my mind while I was listening to the debate.

The first is that the Government are consulting on school funding, and that is absolutely right. It is important that rural school supporters, of which I am one, make absolutely sure to get across the point that these schools should be able to spend their budget with few prescriptions. We also need to sort out the argument over equality between rural and urban schools and, indeed, in rural areas. That is a fundamental issue, and the Government are rightly alive and alert to it.

The second dimension to the question about the future of rural schools is that some wish to expand. In my constituency, that is, to some extent, a pressure. The Government need to make it easier for schools to understand how they can expand and what mechanisms they might use to rise to the challenge of providing extra classrooms. The second issue, therefore, is letting existing schools expand.

The third point that we should discuss is the scope academies have in terms of primary schools and small schools. Giving schools additional independence and autonomy from local authorities addresses some of the issues that have arisen in the debate. It is critical that we send out the message to small rural schools that academy conversion is a way forward.

That leads to me to a point that struck me while I was listening to my hon. Friend the Member for Suffolk Coastal (Dr Coffey). She was talking about shared heads, and that is very much a direction of travel. Academies should be thinking very much about federalising structures, where appropriate, and about sharing facilities.

[Stephen Gilbert]

In my constituency, some very innovative academy chains are being created. That is allowing exactly the kind of economies that the hon. Gentleman is talking about, with a chief executive overlooking a number of primary schools. I therefore endorse his point.

[Neil Carmichael]

I thank the hon. Gentleman very much—I do like to be endorsed every now and again, and that was firm and fair.

Let me reiterate the point about free schools, which are obviously an alternative when a local authority is unwilling to countenance the continuation of schools. It is essential that local communities take hold of the powers and opportunities that the coalition Government have given them to voice what they want.

[Mr Reed]

The hon. Gentleman is making some interesting points, but one issue underlying a lot of the contributions that hon. Members have made is that school failures, for want of a better term, occur in areas of market failure. That is a fundamental problem, and we need to grasp it. It has been evident in England’s rural areas since the war, and it has been accelerating since then. These areas of market failure often have little, if any, real social capital. Are we really telling them, “You either have a free school or an academy, or we withdraw provision”? I do not think that we are, are we?

[Neil Carmichael]

I thank the hon. Gentleman for that interesting intervention—I do not think that it was an endorsement. I am challenging the old way of doing things, with local authorities providing schools and everything that was necessary. We have to take a step away from saying, “The local authority must do this, because it’s always been there, and that’s the way we like it.” We have to move towards a situation where we encourage communities to decide for themselves what they want and to move in the appropriate direction, seizing the opportunities and the tools that the coalition Government are providing. I am saying we should think of a different way of looking at this problem; we should not just go back to the local authority and say, “You must do this.” Instead, we have to go down the academy and the free schools route, if that is what communities want, because a sustainable community will be even more sustainable if it is in charge of its destiny. That is the point that I would make in response to the hon. Gentleman.

I am a great supporter of rural schools. They are absolutely important. They are a part of the rural fabric, make villages work, encourage farmers to be farmers and encourage local people to stay in local areas. However, we need to be more alert to changes that are already in train that will make it easier for many schools to prosper. We also need to address the fundamental and clearly most important question, which I raised initially, about the funding formula.

I support small rural schools. I have plenty in Gloucestershire and I want to see them thrive. The critical point that all of us must understand—I will end on this—is that all schools must strive to be really good schools. It is not good enough to say, “We have a rural school. Great.” Rural schools must provide first-class education. That must be the key test. That is what governs me and that is what I always think when I go around schools in my constituency of Stroud.

--- Later in debate ---

[Catherine McKinnell]

No, but I agree that the hon. Gentleman has made a powerful case for the concerns in the area, regarding the decline that he feels he has witnessed in his area. I feel that all hon. Members today have made a powerful case for state intervention, particularly in such areas, and for serious consideration to be given to how the state can intervene in the market to try to ensure that rural areas do not suffer disproportionately, particularly in the cuts environment that we are facing at the moment. I would be interested to hear the Minister’s response to the concerns that have been raised today.

[Neil Carmichael]

I do not think I was making a case for state intervention. I was making a case for empowering our local communities to take charge of their own schools and to take hold of the opportunities given by the Academies Act 2010, autonomous schools and active, vibrant communities.

[Catherine McKinnell]

I thank the hon. Gentleman for his clarification. The overall impression that I got from hon. Members’ contributions today is that there clearly is a powerful case for concern about a purely market-led approach to education and the impact that that can have on rural communities.

Apprenticeships

Neil Carmichael Excerpts

Monday 19th December 2011 Commons Chamber

[Henry Smith (Crawley) (Con)]

It is a privilege to follow the hon. Member for Liverpool, Walton (Steve Rotheram), a former apprentice, and I am grateful for being called to take part in the debate. As my hon. Friend the Minister said in his introductory remarks, apprenticeship places are central to the economic and social good not only of this country and our local communities, but of individuals.

Youth unemployment is of course a significant concern for every right hon. and hon. Member. Looking back at the history of youth unemployment, it is shocking to see that between May 1997 and May 2010 youth unemployment increased by around 42%, and of course that is still very much a challenge as we face the current debt and international economic crisis, but it is even more important that we focus on properly skilling people, particularly the young, through apprenticeship places, and that is rightly a central commitment of the coalition Government.

Much has been said this evening about national policy on apprenticeships, and I would like to talk about how translating that national policy at a local level is making a real difference in my constituency. I am delighted to report that in the past year the number of apprenticeship places in Crawley has risen by 70%, which is 20% above the national average. That is playing an important role, along with other measures introduced by the Government, such as the Work programme, to ensure that young people in particular can find routes into sustainable employment.

I pay tribute to Central Sussex college, particularly its principal, Dr Russell Strutt, for the work it is doing. It is engaging hundreds of local young people and more than 1,600 local businesses with apprenticeship places across the board, whether in construction, health and social care, business administration, warehousing, hair and beauty or other areas of our diverse economy. Unfortunately, unlike what the hon. Member for West Bromwich West (Mr Bailey) described earlier, the proportion of people from Crawley going on to higher education in 2009-10 was just 17%, which is woefully low. I therefore very much welcome what Central Sussex college is doing in working with the University of Brighton to link local young people to the first-class, global employers in my constituency, such as Thales UK, Varian Medical Systems and Boeing UK, but we need to concentrate on more than just a higher education offer.

[Neil Carmichael (Stroud) (Con)]

I should like to celebrate the work of Dr Beri Hare in promoting engineering and manufacturing at Stroud college, because it is a great tribute to the college’s interest in young people and to the effective way in which it has delivered on ensuring first-class training.

[Henry Smith]

Clearly, further education colleges and those who work so tirelessly in them are making a significant difference, whether in Stroud or in other parts of the country.

The further education sector is not the only one playing a significant role, and I pay tribute to some of my local employers, who are also playing an important role in increasing the number of apprenticeships. One, Virgin Atlantic, which is headquartered in my constituency, is offering 38 apprenticeships in the highly skilled industry of aircraft engineering, and, based on the record of apprenticeship places it offers, almost two thirds of its apprentices stay with the company for a long time, helping to grow that sector of the economy and bringing loyalty to such first-class companies.

Another company in my constituency, TradeSkills4U, the largest electrical apprenticeship organisation anywhere in the country, offers 4,000 places not just in Crawley, obviously, but in the wider country. It offers them not just to young people, either, but to many people who are at the midpoint of their careers and looking to retrain—particularly people leaving the armed services and looking to retrain, especially in solar power technology. I was delighted to help open its new premises on the Manor Royal industrial estate in my constituency earlier this year with Falklands veteran Simon Weston.

Eezehaul, a courier and package company in my constituency, offers apprentice places as well, but both employers cite the importance of literacy and numeracy as a bar to people taking up apprenticeships and as a burden on many companies, because they often have to provide the teaching that schools and parents should have provided a few years earlier. That is why I was delighted to hear my hon. Friend the Minister mention focused support for literacy and numeracy so that apprenticeships can grow further. That can help to grow our commercial sector, thus growing our economy and creating a greater number of jobs.