Education Funding in London

Nic Dakin Excerpts

Wednesday 4th May 2016 Commons Chamber

[Nic Dakin (Scunthorpe) (Lab)]

I thank the Backbench Business Committee for granting the debate, which was secured by the hon. Member for Bromley and Chislehurst (Robert Neill), supported by other Members, including my hon. Friend the Member for Croydon North (Mr Reed).

It has been a good, positive and wide-ranging debate. In addition to the speeches, we have had contributions by way of intervention from my right hon. Friends the Members for Enfield North (Joan Ryan) and for Barking (Dame Margaret Hodge), my hon. Friends the Members for West Ham (Lyn Brown), for Westminster North (Ms Buck), for Gateshead (Ian Mearns) and for Greenwich and Woolwich (Matthew Pennycook), my right hon. and learned Friend the Member for Camberwell and Peckham (Ms Harman), the hon. and learned Member for South East Cambridgeshire (Lucy Frazer), and the hon. Members for Kingston and Surbiton (James Berry), for South West Wiltshire (Dr Murrison), for Kensington (Victoria Borwick), for Hornchurch and Upminster (Dame Angela Watkinson) and for Beckenham (Bob Stewart). The range of Members involved demonstrates the importance of the debate and the issue. I am pleased that the Minister has listened attentively throughout the debate. He has been exemplary in that respect, taking on board the issues that have been raised across the House.

With the last intervention in the debate, my hon. Friend the Member for Greenwich and Woolwich drew our attention to the dangers of taking away local flexibility while rushing for a national formula. That important issue was not mentioned by anyone else, so I thought it should be captured before I move on.

In an excellent opening speech, the hon. Member for Bromley and Chislehurst laid out the landscape really well. He reminded us of London’s high performance, describing it quite rightly as a success story. He also reminded us of the reason for London’s higher level of funding, namely the greater challenges it faces as a result of the number of youngsters with English as a second language, the breadth of the attainment gap and the deprivation in London. All those issues are very significant. His starting point was important; as he said, there is no issue with the principle of fair funding. That point was echoed by many Members from across the House throughout the debate.

What I liked most about the hon. Gentleman’s speech was the sense of celebration—that here we have a success story and something we should capture. That was echoed by comments from many Members on both sides of the House, and by my hon. Friends in particular. My hon. Friend the Member for Hammersmith (Andy Slaughter) talked about the huge strides that London has made. My hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali) reminded us that nine out of 10 London schools are good or outstanding. My hon. Friend the Member for Croydon North talked about the transformation of London schools since 2003 through the London Challenge. My hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) reminded us of the many inspiring, hard-working teachers across her constituency, whose work is mirrored across the whole of London.

There is therefore something to celebrate, but there are concerns that it might be under threat. My hon. Friends the Members for Bethnal Green and Bow, and for Croydon North, pointed to analysis that suggested that funding might decrease for London; one estimate suggested that the cut in funding might be as great as £260 million a year. I understand why some hon. Members are rightly concerned about that, because it would be a huge funding cut.

In a thoughtful and considered contribution, my right hon. Friend the Member for East Ham (Stephen Timms) explored the concern in the House that perhaps things are not being done in the right and proper way. Those perceptions may not be true, but that concern is palpable, and I am sure that the Minister’s commitment in an intervention, when he said that he would meet groups of Members and engage properly with them, went a long way to reassuring my right hon. Friend. However, the proof of the pudding will be in the eating, and as my hon. Friend the Member for Hammersmith said, there is concern that there has been some special interest and access—not something that anybody wishes to happen. If that is the perception among some, the Minister’s generous and immediate commitment to meeting Members who have expressed concern must be followed by thorough action and engagement.

My right hon. Friend the Member for East Ham and others drew attention to the impact that mobility has on school costs in London. Much reference was made to housing issues in London—to the cost of housing, and to the nature of housing estates. I hope that the Minister will consider ways to include that mobility factor in the formula as it is developed. The former Chair of the Education Committee, the hon. Member for Beverley and Holderness (Graham Stuart), put the case for fair funding: if London is getting a good deal, everybody else needs to get one, too. He made that fair challenge in his usual passionate way.

Everyone will agree with the principle of fair funding, but the rub is that one person’s fair funding can end up being another person’s unfair funding. Although I commend the F40 group for its patient and persistent campaign to address the funding needs of its schools and children—indeed, I have been a supportive officer of that group in the past—care must be taken in how that is progressed. The Government have done the right thing in taking careful steps along that road, consulting before acting, and evaluating the consequences before proceeding. However, as this debate demonstrates, there is more to be done in that arena if the Government are to move forward with the confidence of the whole House. There is still no detail about who will be the winners and losers, and by how much, and that major concern naturally leads to the sort of speculation that we have heard today. I hope that the Minister and his colleagues will provide more details, and view today’s debate as a constructive contribution to the ongoing consultation.

Labour’s candidate for Mayor is right to stand up for the capital’s children, and to express the concern that if there are the cuts that some analysts are predicting, it would do huge damage to the next generation of Londoners. The current London Mayor, together with Jules Pipe, chair of London Councils, made clear the case for ongoing investment in London’s schools in a joint letter to the Secretary of State. They are all right. Schools are the first part of the skills and employment supply chain, and any reduction in funding is likely to impact negatively on the growth and productivity of local economies. My hon. Friend the Member for Hornsey and Wood Green (Catherine West) made that point in a good and powerful contribution to the debate. She also talked about the schools and school communities that she is proud to represent, and which have made some of the greatest strides in school improvement over the past year.

The Department for Education’s fair funding consultation document states that it intends to address the variability in funding levels by distributing more funding to areas that are underfunded, while

“gradually reducing the funding of schools that have been generously funded to date”.

It is understandable that many in London fear that this will result in severe cuts to London schools’ budgets, with a negative impact on the capital’s young people. We all know that, with or without fair funding, all schools face a real-terms 8% cut in funding during the lifetime of this Conservative Government. My hon. Friend the Member for Hammersmith detailed the type of budget pressures schools are under and having to manage. Schools are already having to cut back on extracurricular activities. As my hon. Friend the Member for Dulwich and West Norwood said, extracurricular activities benefit low-income children the most, raising aspiration and opportunities. It is a shame that they are already under pressure.

As my hon. Friend the Member for Brentford and Isleworth (Ruth Cadbury) pointed out, schools are already taking subjects off the curriculum to balance the books. There is already pressure in the system, and there is a worry that there may be more pressure in the future. Any headteacher will tell you that teaching assistants and teachers will be next in the firing line if there are further reductions in spending. Dramatic reductions in funding in some areas will make the situation much worse. It is welcome that the Chancellor has committed £500 million to ease the transition from one system to another. However, the Treasury has said that this funding is dependent on how much the Department is willing to contribute. As the Department is faced with the need for more cash for its forced academisation plans, that has raised perfectly reasonable concerns. It is therefore imperative that we have more detail on both the funding formula and the funding underpinning the recent academisation announcement, so that we can see whether the amount of transitional funding available will be adequate to mitigate the costs of the changes.

The indicative modelling carried out by London Councils suggests that the Government would need to increase the direct schools grant by about £521 million, a figure alluded to by my hon. Friend the Member for Croydon North, to protect completely all schools—not just schools in London—in local authorities that would lose money under the national funding formula. So £500 million is being made available, and the modelling suggests that £521 million a year is required to ensure that no school will be worse off. A lot of Members have talked about levelling up, rather than levelling down.

My right hon. Friend the Member for Tottenham (Mr Lammy) made the last contribution to the debate. He reminded us, in his usual highly eloquent style, that the greatest disparity is between funding for pupils in the state system and pupils in the private system. I agree with him that nothing should happen that is to the detriment of any pupils in the state system. We should aspire to match the best anywhere in the world. He alluded to the programme for international student assessment league tables and, in his inimitable fashion, said, “Don’t muck about with the alchemy in London.” I think that is the phrase of the debate. We should be careful what we muck about with as we take this forward.

To be fair, I think the Government are taking their plans forward carefully at the moment. There are things they could do more carefully in the light of this debate. I hope that the Minister will take this opportunity to give us his view on the levelling-up approach. Given the dramatic rise in standards under Labour’s London Challenge and investment in schools in the capital and across the country, is the Minister concerned that taking away funds from London schools will impact on results and outcomes? That concern has been echoed by Members across the Chamber.

I have one helpful suggestion—I am a helpful chap—for the Minister to consider as part of the ongoing consultation. The Secretary of State’s plan to force all good and outstanding schools to become academies against their wishes is estimated to cost £1.3 billion. As my hon. Friend the Member for Ealing Central and Acton (Dr Huq) said very succinctly, that is poor value for the taxpayer, and I tend to agree. Nobody wants this forced academy programme—certainly not the Minister’s Back Benchers, and certainly not local Conservative councillors. If Ministers dropped this plan, they would have more cash to play with to help deliver a truly fair funding formula. That would have the dual benefit of helping to deliver a manifesto commitment and leaving Education Ministers to focus their energy and effort on the things that really matter to parents and communities, without being distracted by an unhelpful row over forced academisation. Instead, Ministers would be able to tackle the real problems of place planning, teacher supply and exam chaos.

Labour supports fairer funding, but as always, the devil will be in the detail, and the jury is still out on whether there will be adequate mitigation in the system that this Government are bringing forward.