Education and Adoption Bill

Lord Hunt of Kings Heath Excerpts

Tuesday 1st December 2015 Lords Chamber

1: After Clause 6, insert the following new Clause—
“Scrutiny of education provision
(1) The Education and Inspections Act 2006 is amended as follows.
(2) After section 70C insert—
“70D Scrutiny of education provision
(1) This section applies where more than 10 per cent of schools in a local education authority area are eligible for intervention under section 60B as inserted by section 1 of the Education and Adoption Act 2015 (coasting schools).
(2) The relevant local authority may establish, under section 21(2) of the Local Government Act 2000 (overview and scrutiny committees), a committee of that authority to review and scrutinise matters relating to the provision of education in such schools in the authority’s area, and to make reports and recommendations on such matters in accordance with regulations under this section.
(3) Regulations shall make provision—
(a) as to the matters relating to the provision of education in such schools in the authority’s area which the committee may review and scrutinise;(b) as to matters relating to the provision of education in such schools in the authority’s area on which the committee may make reports and recommendations to local Academy sponsors;(c) as to information which local Academy sponsors must provide to the committee; and(d) requiring Regional Schools Commissioners to attend the committee to answer questions.””

[Lord Hunt of Kings Heath (Lab)]

My Lords, I suspect that the movers of the amendment have been rather taken by surprise by the speed with which the European Union Referendum Bill completed its Third Reading, which on past counts was rather unexpected. My congratulations to the Minister, the noble Baroness, Lady Anelay, on the speedy way in which she dispatched the business. I think it would be fair to the noble Lord, Lord Storey, to allow him to arrive.

This is clearly an amendment about the role of local authorities. Obviously the specific details are contained in the amendment, but I want to take this opportunity to ask the Minister whether he is able to say something more about the role of local authorities in education in the future, because that is very much contingent on the amendment before us. He knows that we have debated whether the Government’s real intention is for all schools in the maintained sector to become academies. The Minister has rather dissembled on that point, but he will know that it was very clear from what his right honourable friend the Chancellor of the Exchequer said only last week in the Autumn Statement that it is essentially the Government’s intention that at least all secondary schools should become academies. Mr Osborne said:

“Five years ago, 200 schools were academies: today, 5,000 schools are. Our goal is to complete this school revolution and help every secondary school become an academy. I can announce that we will let sixth-form colleges become academies, too, so that they no longer have to pay VAT. We will make local authorities running schools a thing of the past, which will help us save around £600 million on the education services grant”.—[Official Report, Commons, 25/11/15; col. 713.]

As the amendment talks about local authorities, it is entirely reasonable for me to ask whether that is an enunciation of a new government policy. If it is, and my impression is that when the Chancellor makes a Statement in the other place it is an enunciation of policy, clearly it is the Government’s intention to take local authorities completely out of the schools sector.

The point that I put to the Minister is this: why are we going through the charade of this Bill when it is the clear intention of the Government to phase out maintained schools completely? Why are the Government not prepared to be open and honest about this? Why do they not come forward with the appropriate legislation? I would oppose that legislation, but let us at least have an honest debate. I know that we are on Report and I guess that I am pressing against the boundaries of what is allowed, but it is none the less a very interesting amendment.

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[The Parliamentary Under-Secretary of State, Department for Education (Lord Nash) (Con)]

My Lords, responding to the original remarks of the noble Lord, Lord Hunt, I am glad that he used the word “dissembled” over the question of the future of the academy programme and local authorities. I think that it is a better word than “dishonest”, which he used in Committee. I have made it absolutely clear on a number of occasions that the default position for a coasting school is not to become an academy. However, the Prime Minister has been clear that our ambition is that, in time, every school will have the opportunity to become an academy. Given that ambition, it is right that we look at how we might reform the role of local authorities in education, although there is no intention of taking them out of education totally. Obviously their role in school improvement will reduce as regional schools commissioners take more responsibility.

[Lord Hunt of Kings Heath]

I hear what the Minister says but what did the Chancellor mean by saying:

“We will make local authorities running schools a thing of the past”.—[Official Report, Commons, 25/11/15; col. 1370.]?

What does that mean in relation to what the noble Lord has said? He may not like my use of the words “dissembling” or “dishonest” but I come back to the core point. Is it the Government’s intention that, willy-nilly, all schools will be academies, as the Chancellor said last week?

[Lord Nash]

Perhaps the noble Lord will let me finish. In a situation at some stage in the future where all schools were academies, obviously local authorities would not be running schools. However, we certainly anticipate them continuing to have a role in the sufficiency duty, admissions, SEN and safeguarding. Perhaps I may make it absolutely clear that it is not about making every school an academy overnight at the stroke of a pen. That is not what we are after at all; we are about organising schools so that through academies and the multi-academy trust programme many more of them can, by working with each other, take advantage of the benefit of economies of scale efficiencies and deliver career enhancement, better CPD and leadership development. Given that ambition, it is right that we look at how we form the role of local authorities, as we have discussed.

The noble Baroness, Lady Pinnock, referred to financial irregularities in academies. I think that we have covered this before but I re-emphasise that academies are subject to far greater financial scrutiny than local authority maintained schools. They have to publish annual accounts which are audited by third-party accountants, something local authority maintained schools do not have to do. They are subject to the scrutiny of the EFA and the Charity Commission, and they are also subject to company law. I do not wish to make comparisons—

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[Baroness Pinnock]

My Lords, I am a relative newcomer to your Lordships’ House, and just one of the features of the legislative process that has amazed me is that substantial changes can be made without there being any publicly stated budgetary provision. Therefore, here we are again today, legislating for an increase in the number of academy conversions without any stated provision for funding the changes.

Every school that seeks or is forced to become an academy is given a grant of £25,000, so if 1,000 schools are converted into academies, as the Minister stated in Committee, the Government will need to set aside £25 million. I accept that this is small change in the Government’s big budgetary process; nevertheless, £25 million can go a long way in other sectors of the education service.

This is just the upfront, visible funding. A report by the National Audit Office in November 2012, Managing the Expansion of the Academies Programme, stated that the additional cost of the academy programme to the Department for Education was £1 billion. The programme had by this stage involved just over 1,000 schools. Although there have been reductions in the costs of conversions since then, as reported by the NAO, there are undeniably costs in addition to the upfront £25,000 per school grant.

In response to the amendment tabled in Committee, the Minister said:

“I will be delighted to comment more on the DfE’s total settlement on Report”.—[Official Report, 17/11/15; col. GC 51.]

I look forward to hearing the specific details from the Minister. If no budget is identified, I, for one, will have to conclude that the funding is being top-sliced from other areas of the schools budget. If so, I will be very disappointed, because schools’ budgets are already being squeezed and further cuts would put some of them in considerable financial difficulty.

Therefore, the amendment is tabled with a purpose, which is to try to discover how much the Bill is going to cost the education sector and where the money is coming from. If, as I hope, the Minister is able to clarify all those points, I will indeed be very satisfied.

[Lord Hunt of Kings Heath]

My Lords, I am sure that we will all be interested to hear from the noble Lord the answers to the noble Baroness’s questions, particularly his response to her suggestion that the money for the implementation of the education parts of the Bill will be top-sliced, presumably from money that would have gone through local authorities to maintained schools. I would be very interested to know the answer to that.

I am going to tempt fate by asking the Minister the same question again, referring to what the Chancellor of the Exchequer said about the education budget in the Autumn Statement and his announcement that all schools in the secondary sector will become academies. He said:

“We will make local authorities running schools a thing of the past, which will help us save around £600 million on the education services grant”.—[Official Report, Commons, 25/11/15; col. 1370.]

I would like to know how on earth that £600 million is going to be saved. Does he think that the £600 million used by local authorities is simply a waste of money? All those central services provided by local authorities are to be destroyed but presumably most maintained schools think they are pretty helpful. I assume that, when they all become academies, the schools will be given some element of the budget to make up for the services they would have received from local authorities.

Understanding education finances these days is a conundrum but I certainly hope that the Minister will clarify what exactly his right honourable friend the Chancellor of the Exchequer meant by what he said last week. Perhaps the answer to the noble Baroness’s question is that the finances are going to come directly from the money that would have gone to local authorities, which may be what she meant by top-slicing.

[Lord Nash]

My Lords, Amendment 8, tabled by the noble Lord, Lord Storey, and the noble Baroness, Lady Pinnock, requires that the Bill cannot be commenced until a report on funding the costs of the academy conversions resulting from the Bill has been laid before Parliament.

As noble Lords may recall, this amendment was also tabled during Grand Committee, when I agreed to say more on the outcome of the spending review in relation to the Bill. I hope the noble Baroness will be delighted to hear that I can now do so. I am pleased to say that, following the Chancellor’s Statement last week, total spending on education will increase in cash terms in this spending review period from £60 billion in 2015-16 to nearly £65 billion in 2020. The exact budget for the academy programme will be finally determined following our internal business planning process, now that we know the exact spending review settlement. But I would like to reassure the House that the Department for Education’s overall settlement clearly recognises the potential costs of academy conversions as a result of this Bill and has been very much part of the detailed conversations we have had with HMT. I hope that the noble Baroness is pleased to hear that.