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Baroness Blackstone: Yes; this is a decline that began some years ago under our predecessors, and which we certainly want to stem. We are examining the matter and shall be determined in the action that we take following the consultation, when we know the views of the schools and local authorities, to ensure that there is a good library service in those LEAs which wish to retain one and where the schools are in favour of it.

Lord Lucas: The noble Baroness's reply raises a number of questions, and this might be a good point at which to raise them, rather than troubling the Committee with them later. The noble Baroness talked about waiting to see how the pattern of local authority expenditure develops in relation to the items which it is allowed to retain under non-school expenditure and the local schools budget. Will the figures in the categories set out on page 9 of the consultation paper be published and available to us in this House as part of the local authorities' budgeting procedure and reports to the DfEE? Shall we know at a fairly early stage what levels are proposed for strategic management expenditure and other items set out in the document, or are they to remain private between the Government and local authorities? What level of information shall we receive as to how the pattern of expenditure is developing?

How will the figures that are to be provided be audited? There is a mention of that in the consultation paper; however, I believe it refers only to auditing the local schools budget, whereas an enormously important aspect in understanding and controlling expenditure is to make sure that the local authority is putting into the general schools budget all the expenditure that it should be. There has certainly been much avoidance of LMS by shoving off schools expenditure under other general headings within the local authority, and money which should belong in schools budgets has been spent in a way which does not appear in the schools budgets. It would therefore be nice to know that that level, too, was audited, so that we have genuinely comparable figures.

The question of music was raised by my noble friend Lady Blatch. This area causes me concern, too. How, for instance, under this proposal, will the specialist music course at Pimlico School be funded? The school looks after a number of London boroughs and provides a specialist course to which children travel from 10, 15 and 20 miles away. How will that sort of course be funded under the proposed arrangements?

To return to a matter that has puzzled me for a long time, what is different about school transport? The idea that a school is not capable of paying a bus company for a bus seems enormously strange. There is a structure of school transport which could be immediately delegated. The schools could merely buy back what is there, and there would be no difference in total cost or

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expenditure. The system might then develop in a way that was much more cost-effective and which made use of a school's ability to do things in ways that are more innovative and improve its use of money in the same way as happens in other parts of the school budget. What is it about school transport that makes that impossible?

Baroness Blackstone: I shall try to answer all of those questions. Regarding strategic management expenditure, it is right that we should try to provide as much information to Parliament as we possibly can. There will be enormous variations in what that will amount to according to different authorities. However, we can certainly try to provide as much detail as possible on the overall amounts that are likely to be spent in this area. I shall come back to the noble Lord on the likely timing for that. As yet, it is not fixed.

On the question of auditing, local authority financial statements are already audited by the Audit Commission. That will continue. LEAs are under fairly strict auditing arrangements, so there can be no question of schools being audited but LEAs not.

The noble Lord asked about school transport. I think the answer to his question is a commonsense one. There may well be children living in villages quite a long way from the nearest secondary schools but the children may go to a variety of different schools. For each school separately to provide transport to pick up children from 10 different villages, who may be going to three or four different secondary schools in a town which serves a big rural area, would not make much sense. I think the answer to the question is that, for the most part, school transport can be provided more cheaply and effectively if it is provided collectively.

Lord Peston: I am sorry to interrupt my noble friend. As someone who has moved back to a rural area, I have become very sensitive to rural issues. It seems to me that school transport is different from other matters for economy-of-scale purposes. From my observation of what happens in practice, I believe that the noble Lord, Lord Lucas, is right. A local authority does not usually use its own transport; it buys it from the private sector. It therefore meets the objective, anyway. I believe that the noble Baroness, Lady Blatch, referred to returns to scale. Certainly, it was referred to. I believe that this is a straight returns-to-scale phenomenon. I must say to the noble Lord that, although I no longer have children of school age, I am at least as sensitive to the needs of school transport as anyone could be.

Lord Lucas: I cannot see the difficulty in schools co-operating with each other to provide transport. We are in an age of co-operation. Much co-operation is encouraged by the Bill. For the rural areas that I know, the picture that the noble Baroness paints is completely wrong. School transport from the local area around Winchester goes to one school; it does not go to the others. The local authority will not provide transport to any other than the designated school. As far as I know, that pattern is common throughout the country. I am not aware of any local authority which provides rural

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transport to all the secondary schools in a town so that parents have a free choice. I should be delighted if the noble Baroness could inform me of local authorities where that is the practice; I do not know of any.

Baroness Blackstone: I think perhaps the noble Lord, Lord Lucas, misunderstood what I said, or perhaps I did not make it clear enough. The local authority provides transport across the authority for all the schools. It may not take individual children from particular villages to different schools in the town to which they are going. It is a matter of economy of scale. Maybe the noble Lord is right; maybe in the longer term this is something that could be delegated to schools. We should not be ideological about a matter of this kind. It is a matter of what makes good, practical common sense. If, on consultation, we find that those who have to make decisions about these matters share the view of the noble Lord, Lord Lucas, and can demonstrate that it would be cheaper, more efficient, more effective and more sensible from the point of view of the consumers--in other words, the parents and the pupils--and of the schools, in relation to how they make their arrangements, to provide transport in that way, I see no particular reason why that should not be considered. However, I suspect that the arguments will fall in the other direction.

6.15 p.m.

Lord Lucas: The argument of economy of scale applies to almost all these bits of funding which are being delegated. The local authority has always said that it can buy school books more cheaply and that is why it should do so and distribute them to the schools. Much of the success of LMS has been in proving that many of the arguments about economies of scale do not apply in practice because an individual school can use the money much more effectively, even if it has to pay a little more for the lesser quantity that it uses. This is a side issue. I shall not continue to burden the Committee with it.

Lord Tope: I wished to hear the Minister before intervening briefly. The Minister has demonstrated what those of us who have some experience of these matters know already: that this is an enormously complex subject and not well-attuned to simplistic slogans about how much delegation there is. The noble Baroness, Lady Blatch, was right to ask at the beginning: a 100 per cent. or 90 per cent. of what? This is a difficult issue. There was a little bit of, "Who thought of this first?" and "Who is keenest on delegation?" It was suggested first that it was old Labour, then that it was new Labour, then that it was really the Conservatives. I need to put on record that it was actually the Liberal Democrats who thought of it first, and, indeed, as I am certain the noble Baroness, Lady Blatch, will remember, introduced it first, not far distant from her area.

Baroness Blatch: I hope that the noble Lord will give way. If the noble Lord is claiming that the Liberals introduced this in Cambridgeshire in the early 1980s, I ask him to go back and examine the books. I was the

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leader of the authority; I and my Conservative colleagues introduced it, and we were the first in the country to do so.

Lord Tope: I readily accept that I asked for that. I shall not pursue the matter now. We have already been down enough byways, rural or otherwise, tonight. I simply wanted to put the matter on record.

Let us accept that all of us favour the greatest possible delegation. It is what it means and what effect it has that is all-important. The Minister was right on this occasion to say that we must await the results of the consultation, which has only just begun. It is consultation we sought when the Bill was in the other place, and I am pleased that it is taking place. We need to await the results. LEAs, schools and others will have useful and important points to make. It is too early, and probably not necessary, to be too prescriptive on the face of the Bill. In fact, I believe it would be positively dangerous to do that. I shall return to that point.

It is said that schools were delighted to know that there would be greater delegation next year. I am sure that, on the whole, that is true. I am sure that schools are delighted to know that they will have more money next year; it would be remarkable if they were not. But it remains to be seen how much money they will have when they have to buy back services. Whether from the LEA or anywhere else, they are going to buy back services. In my experience, most schools, head teachers and governors know enough about the complexities of the matter not to think that a great bonanza has suddenly been unlocked simply through greater delegation. It has not been, and will not be.

Not all schools welcome delegation. I believe I have mentioned before in this Chamber that I am a governor of a junior school with about 300 pupils. Of course, the principle of delegation is welcomed, but the extra administrative burden and buying back services, whether from the LEA or anywhere else, make my fellow governors wonder whether it is worth their time and worry. While a larger secondary school, with perhaps a larger and more experienced governing body, might take it in its stride, and indeed welcome it, that is not necessarily the case with smaller schools, which are usually primary schools. Let us not be too carried away with the rhetoric that all of this is good and that anyone who has reservations about it must necessarily be wrong. That is not the case.

I worry about the Government being over- prescriptive. What is most important is that the balance and the relationship between the schools and the LEA should be right and agreed mutually between them. I readily accept that that is not the case now in all LEAs. If schools generally feel that they are happy to have less delegation, I believe that that should be a matter between the schools and the LEA. Our role as legislators is to ensure that neither party--more usually the schools--is in any way disadvantaged in reaching that agreement. As to whether it is right for government to prescribe that it should be 90 per cent., £50 per pupil, or any other figure, that suggestion makes good headlines but bad practice on the ground.

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I want to say a few words on the amendment. The noble Lord, Lord Peston, dealt with Amendment No. 158A extremely well, if a little unkindly. He turned it on its head and asked how one could have a formula that did not include those matters. I wondered about that and thought: why only this? Why is there no reference, for example, to special needs, to English as an additional language and to any number of other factors? Indeed, any number of other factors may be in a formula. The danger of putting some obviously right things on the face of the Bill is that one then wonders about the things that are equally right, but are not on the face of the Bill. For that reason alone I feel not only that the amendment is unnecessary, but also that if it were to be on the face of the Bill, it could be dangerous.

I want to say a few words also about the amendment of the noble Baroness, Lady Blatch, in relation to school library services. That is something which I am sure we all strongly value. We all view with concern the decline in school library services in most areas--some much more than others--for understandable reasons. I do not want to provoke the noble Baroness, Lady Batch, again, but school budgets have been under pressure in recent years--I make that as neutral a statement as I can--for all sorts of reasons. LEAs and schools must look at what they spend and where they have to make unwelcome cuts, and I am afraid that the school library service has too often been a victim of that.

The Minister illustrated the difficulty of those matters when she acknowledged that in some of the 40 LEAs to which we were referring it may be a matter that is being dealt with and shown in a different way. The point that that illustrates, which I come across time and again, is the importance of comparing like with like. One of the dangers of just looking at statistics produced in a column for every LEA in the country is that behind those figures are a lot of stories which do not reveal the whole picture. That may attract one's attention and require one to look behind the figures, but we need to do that to make sure that we are comparing like with like; that one LEA is including in those figures the same factors as another LEA. That is often not the case. The illustration involving the library service is just one aspect of that. It happens, for example, with youth services and all sorts of other factors.

The Minister is right to approach this matter with considerable caution. I am pleased that the consultation is taking place. There is a general feeling in all parties and among government and LEAs in favour of greater delegation. I do not believe that that is an issue any more; what is an issue is what is delegated and how it is delegated. In that regard we are right to proceed cautiously with proper and full consultation and to be no more prescriptive than we need to be.

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