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Education Spending

3.30 pm

The Secretary of State for Education and Skills (Estelle Morris): With permission, Mr. Speaker, I wish to make a statement. Yesterday, my right hon. Friend the Chancellor confirmed that education is this Government's No. 1 priority. Since 1997, we have broken the cycle of underfunding in education, but we have done more than that: we have demonstrated that our policies of resources for reform work.

In 1997, we took the tough decision to focus our extra resources and reforms on early years and primary schools, because we knew that we had to get the basics right, and the results are there to see: more nursery places; 500 sure start areas; the biggest ever expansion in child care; and every primary teacher has been retrained in the teaching of literacy and numeracy. The result has been a huge leap in the performance of our 11-year-olds.

We also laid the foundations for raising standards in secondary schools. Again, where we committed resources for reform, we delivered results. The number of specialist schools increased from 181 in 1997, to 982 by September this year, and GCSE results are rising more swiftly in those schools. In our excellence in cities areas, results are increasing faster than elsewhere. Our record is one of investment and reform, and thousands of pupils and parents have benefited from it.

We know that it works, so it is now time to step up the pace of investment, matched by a step up in the pace of reform. In England, education spending will rise by an average of 6 per cent. a year over the next three years—a £12.8 billion increase. Total investment in my Department will be nearly £58 billion a year by 2005–06—more than £1,000 per pupil more in real terms than we inherited in 1997.

In the time available to me today, I cannot possibly do justice to every issue covered by my responsibilities as Secretary of State. I therefore intend to focus on the reform of secondary education, but when we have completed our consultation on our reform document for further education I will make further announcements. I can confirm that, subject to agreement to that reform, core unit funding in FE will increase by 1 per cent. per annum in real terms over each of the next three years.

In the autumn, we will publish a 10-year strategy for our universities, setting out how we will deliver the twin goals of excellence in teaching and research and widening access and participation. However, I can announce today that, as part of the Government's commitment to research excellence, we will substantially increase recurrent funding for research, raising the additional investment by more than £200 million by 2005–06. Alongside the investment in the science budget announced by the Chancellor yesterday, that will enable our research to be truly world class.

To carry on now to raise standards in our secondary schools, we need to make a decisive break with those parts of the existing comprehensive system that still hold us back. In saying that, I want to be clear about one thing: this is not a return to the old, failed two-tier system. The comprehensive principle was right and remains right. Every child is of equal worth. Ability is not determined by the family or background into which people are born,

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and all children have a right to an education that meets their highest aspirations and helps them to achieve their individual potential. That is as true now as it has ever been.

Again, without doubt, the move to comprehensive education brought progress. It has given more people the qualifications for higher education and more children have gained good GCSEs. It has produced an entitlement to a broad and balanced curriculum for all children. It has delivered huge progress in the achievement of girls. It has brought more life chances to so many of our young people.

Progress at secondary level has not been fast enough, however, and no one can say that what we have now is as good as we want it to be. Too many pupils are still going backwards between the ages of 11 and 14. Pupil behaviour often deteriorates at secondary level. Half of our 16-year-olds still leave school without five good GCSEs. The UK still has one of the greatest class divides in education. Too many schools are failing or coasting along without being able to stretch all their pupils.

We have not, therefore, achieved all for which we hoped. We need to be bolder and change our secondary system if we are to deliver high standards for all our children. We need radical reform in four key areas: in school structures; in school leadership; in teaching and learning; and in the link between rights and responsibilities both within schools and between schools and the broader community.

First, I shall deal with reform of school structures. In the past, the comprehensive system has been too uniform. There have been insufficient incentives for schools to improve, and excellence has been isolated and has not been used to raise standards across the school system as a whole. We therefore need a secondary system that instead promotes specialism and diversity, in which every school is honest about its strengths and weaknesses and is given clear incentives to improve, and in which our best schools are rewarded for levering up standards in the rest.

The new secondary system must have schools that are, in some respects, the same as each other. High aspirations, a broad and balanced curriculum, good-quality teaching and leadership, fair admissions and clear routes of progression are essential for every school. Every school also needs to be different, however, which is why specialist schools are central to our school reform. Their specialism is in addition to the national curriculum and encourages them to develop their own ethos and mission. Let me be clear: our aim is that, over time, every school that can be and wants to be a specialist school will be able to be one. I can announce today that we will increase the number of specialist schools to 2,000 by 2006. That will mean more than half our secondary schools will be specialist within the next four years.

It is not just a question of specialist schools. We will create at least 33 new city academies by 2006, and new extended schools. Each school will have its own mission and its own strengths, all contributing to raising standards. We also need a ladder of achievement to make sure that every school has clear incentives to improve—a system in which every school knows where it stands, is challenged to raise its level, and is incentivised and supported when it does so. Rather than having a one-size-fits-all approach, we need to acknowledge the

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truth that different schools are at different stages in school improvement and need different levels of challenge and support, freedoms and responsibilities.

On this ladder of improvement, weak and failing schools will be provided with extra resources, but those will be matched to tough improvement programmes. If schools do not improve, there will be quicker action to close them down, reopen them as academies, replace their leadership or enable them to be taken over by more successful schools. For coasting schools, there will be incentives to develop school improvement plans and work towards specialist status. For good schools, such as our specialist schools, training schools and extended schools, extra resources will be matched to the development of real centres of excellence in each school. For our best schools, there will be new resources and new freedom, but those will be matched to new responsibilities to improve the school system as a whole.

As a result of that ladder of improvement, a vital new principle for our new secondary system will be that, for the first time, we will use our best schools and head teachers to lever up standards in the rest. That is why we will encourage our best schools to expand. That is why we will promote our best schools to take over and run weak and failing schools. That is why we will provide incentives for our best schools to federate and improve standards in our weaker and coasting schools. That is why we will reward our best heads for taking on new roles as chief executives of clusters of schools.

Today, we are announcing that we will designate 300 advanced schools over the next four years. The schools will be charged with helping to lever up standards in our weaker schools and will have the resources to do so.

It is not only school structures, however, that we need to reform. Leadership is essential to the success of any school. We have already established the national college for school leadership as the world's first institution dedicated to identifying and training excellent leaders in our school system. The college will make sure that every new head is properly qualified, and that existing heads are properly supported and trained with access to mentors from outside education. The college will take on new roles in developing a new generation of transformational leaders.

We recognise that it is vital to secure the best possible leadership for the schools that face the toughest challenges. Next year we will introduce a leadership incentive grant to ensure that excellent leadership exists in our most challenged secondary schools. The grant—about £125,000 per school per year—will be paid to about 1,400 secondary schools in excellence in cities areas and excellence clusters, and to schools in challenging circumstances outside such areas. Where schools are well led, the grant will be paid directly with no strings attached; where leadership is weaker, heads and governors will need to agree a development plan with the directors of education in their local authorities. When necessary, and if it is in the best interests of a school and its pupils, the plan will include the replacement of the head teacher.

The third area needing reform is that of teaching and learning. The realisation of every child's potential is what all teachers want for their pupils and what all parents want for their children. Increasingly, the new specialist secondary school system will be able to tailor education to the needs of individual children; but that will require a

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radical change in the way in which teachers use their expertise and their time, in their professional development and in how they use technology—in fact, in how they do their job.

We have already been discussing with the profession how we can bring about those changes: now we can back up the discussions with resources. The money that schools receive through the standard spending assessment will rise by 3.5 per cent. in real terms in each of the next three years. On top of that record sum, the Chancellor has announced a substantial increase in the schools standard grants, paid directly to schools. The grant will increase by £325 million in 2003–04, and by £375 million in each of the following two years. That means that from next year direct payments will rise by £50,000 a year to at least £165,000 for a typical secondary school in England. Direct payments to a typical primary school will rise by £10,000 to at least £50,000.

That money, together with the increased general funding, can be used at head teachers' discretion. Let me make it absolutely clear, however, that the extra schools standard grant is conditional on reform of the way in which schools work. It must be matched by a commitment across the schools sector to a restructured teaching profession and a reformed school work force: more flexible, more diverse, and focused on raising standards.

We need commitment to new professional roles for teachers. We need commitment to new roles for school para-professionals, enabling them to take on new tasks in schools and to support teachers. We need commitment to an improved pay and performance management regime that rewards excellent teaching and eliminates poor teaching. In the autumn we will set out our more specific proposals, and the process for achieving the necessary agreement.

Finally, we must strengthen dramatically the link between rights and responsibilities. The new system needs to capture not only what schools can do for themselves, but how parents and the wider community can play their part. We must have zero tolerance of indiscipline in schools. Today I can announce a significant expansion of measures taken earlier this year to tackle poor behaviour and crack down on indiscipline. We have already seen the success of learning support units, on-site centres that can better deal with the small minority of pupils who cannot settle and who disrupt others in the classroom. As part of a national behaviour strategy to be launched in the autumn, we will provide learning support units for every school where they are needed. There will be more police on site at our toughest schools, if heads agree to that. Outside schools, truancy sweeps will be extended.

More broadly, however, I want to break down the walls and do more to help schools become a central part of their communities. We will therefore develop new extended schools that will provide a range of services, along with education, on the same site.

Moving to the new comprehensive ideal means higher standards, zero tolerance of bad behaviour and a greater choice of good schools for parents. The Government have made their choice. We have chosen to make education our No.1 priority, and we have backed that choice with sustained investment on an unprecedented scale, matched by reform involving unprecedented ambition. We have a proven model of reform; we have the best teachers ever

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in our schools; we have the resources and the ambition to achieve the change. A world-class education system is what we aim for, and that is a prize well worth winning.

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