Unemployment fell in South West Bedfordshire last week which was very welcome news.  Across the UK there are now 70,000 fewer people on out of work benefits since the general election.  There are also 370,000 more people in work now than there were when this government took office and the private sector has created 600,000 more jobs in that time.

We are also making very good progress in getting the country to live within its means.  Over the last two years we have cut the deficit by a quarter.  Most people that I talk to realize that the country has lived beyond its means for years.  The last government spent money it did not have.  Just because that spending was sometimes on worthy causes does not mean it was affordable.  We have a choice as a country, either we run our finances sustainably or we give up the right to govern ourselves.  There are examples of the second category in our own continent.

Low interest rates really matter to families and businesses.  Each 1% increase in interest rates adds £1,000 to the cost of a typical family mortgage.  When we came to power we had the same interest rates as Spain.  Today UK interest rates are below 2%, whereas Spanish rates are over 6%.

The UK car industry is still important locally to the south Bedfordshire and Luton economies.  The Vauxhall van factory continues to prosper and it is hugely encouraging that for the first time since 1976 Britain is now a net car exporter and we have a surplus in motor manufacturing.  Vauxhall, Jaguar Land Rover, Ford, Honda and Nissan have all lead the way with further good news about Vauxhall jobs last week.  Much of the design work for the Nissan Qashqai was undertaken in Bedfordshire and it is built in Sunderland, one of Nissan’s most efficient car plants in the world.

I have spoken to businesses in Leighton Buzzard, Dunstable and Houghton Regis this week who are investing locally and exporting beyond the troubled eurozone countries.  An engineering company managing director in Houghton Regis told me he has a full order book, and that he will be taking on staff and working with the new university technical college in Houghton Regis opening this September.  His major markets are Russia, India and Canada.  He told me how helpful UK Trade and Investment had been in arranging a webinar with Canadian shipyards through the UK High Commission in Ottawa.  The Foreign Office have been instructed to prioritize precisely this type of export assistance to UK businesses.

At the moment about half our trade is with Europe but Europe represents only a fifth of the world economy.  Asia, Africa and the Americas are growing strongly with the world economy due to more than triple in size over the next 30 years.  Through the power of the internet, local businesses large and small can export more easily than they realize.  I look forward to seeing more export success from our local businesses and also the estimated 6,850 new jobs that will come from the opportunities opened up by the A5-M1 link.

A cross party group of MP’s, including South West Bedfordshire MP Andrew Selous have called on internet service providers to show more commitment to protecting children from being able to access suicide, self harm, pro-anorexia and pornographic websites. On the 4th May, the Government responded by launching a formal consultation with internet service providers and other interested parties.

Andrew Selous MP said “I am delighted that the Government is taking action about this issue which 8 out of 10 parents really care about. Several recent studies have shown increasing numbers of children, often as young as 10 regularly accessing internet pornography. Only a third of houses with teenagers have any filtering and many parents find filters difficult to install”

“Some homes have over 15 internet enabled devices, and single account home network filters, such as the one provided by TalkTalk are a step forward. The inquiry found strong support for an opt-in system with a default setting that bars harmful content , as happens in many schools, businesses and in the Houses of Parliament. I hope that the ISPs can work together to produce their own solution.”

Andrew Selous MP has officially ‘plugged in’ a new electric vehicle charging point on the ground floor of the multi storey car park on West Street, Leighton Buzzard. The first electric charging point for Leighton Buzzard was unveiled on Friday 27 April by Central Bedfordshire Council and Andrew Selous MP to be included in the Source East Vehicle Recharging Network.  It is the first of its kind in South West Bedfordshire and the next installation is due to be in Dunstable.  Central Bedfordshire Council has worked alongside Source East, which is managed by Evalu8 Transport Innovations Ltd, to enable more sustainable transport in the country and will eventually link together a number of charging points across the East of England. 

MP Andrew Selous said: “Electric vehicles will provide cheaper motoring, massive new job prospects and help slow down climate change.  I hugely welcome the arrival of electric vehicle charging points in Leighton Buzzard and Dunstable.  I hope that these charging points are the first of many electric vehicle charging points to be installed in Central Bedfordshire over the next few years.”

Organisations wanting to get involved in the scheme can access grants of up to seventy-five per cent off of the cost of the post and installation by working with EValu8.  The Source East network will grow to around 1200 points by March 2013.  There are currently points in Norwich, Colchester, Chelmsford and Hemel Hempstead, with live points to follow in Luton and Peterborough.

To find out more about the Source East programme including network updates and post availability visit http://www.sourceeast.net/

 South West Bedfordshire MP Andrew Selous raised the unfairness of the current schools funding formula with the Schools Minister in a House of Commons debate yesterday. Under the current formula Central Bedfordshire schools receive £657 per child less than Luton schools and £156 per child less than Buckinghamshire schools.

 Speaking after the debate, Andrew Selous said, “It is not fair that our neighbouring areas, Luton and Buckinghamshire, one richer and one poorer than Central Bedfordshire, both receive more money than Central Bedfordshire children do. I welcome the Government’s decision to change the funding formula to deal with this unfairness and to give greater certainty and clarity to schools over their budgets”.

The exchange in Hansard was as follows:

Andrew Selous (South West Bedfordshire) (Con): Let me be the first to congratulate my hon. Friend the Member for Gloucester (Richard Graham) on a superb introduction to this important issue, which has drawn a large number of hon. Members to the Chamber. It would have been nice to see a few hon. Members from Her Majesty’s Opposition, but they seem to be somewhat absent. I congratulate my hon. Friend on the sensitive way in which he has raised this important issue.

We all have a duty to speak up for our constituents. Central Bedfordshire council is in the unique position of having a local authority on one side of it, Luton, which is generally poorer than central Bedfordshire, and a local authority on the other side of it, Buckinghamshire, which is richer. Both authorities receive more money per child than central Bedfordshire. I put it to the Minister that it is very hard, as a Bedfordshire MP, to explain to my constituents why the authorities on either side, one of which is poorer and one of which is richer, receive more money. It makes an eloquent case for why the formula has no logic or rationale.

Each child in central Bedfordshire receives £4,658, compared with a child in Luton who receives £5,315 and a child in Buckinghamshire who receives £4,814. A child in Luton gets £657 more and a child in wealthier Buckinghamshire, our neighbour, gets £156 more. Every political party across the spectrum in central Bedfordshire is unhappy about that. The leader of Central Bedfordshire council wrote to the Secretary of State on 25 January to express the views of the whole council on this matter.

 Some hon. Members have already mentioned that relatively wealthy areas often have significant pockets of deprivation. That is true in my constituency. There is deprivation in Houghton Regis, for example. The indices of multiple deprivation in some wards in that town are not dissimilar to those in much higher-funded Luton next door. The formula fails poorer children in wealthier areas. We need to look at that to see whether the formula could drill down and give additional funding for poorer children in slightly wealthier areas.

 This Government made an impressive start on this issue by publishing “School funding reform: next steps towards a fairer system” a few weeks ago. I am grateful to the Minister and his colleagues at the Department for recognising the problem and setting out a route map for dealing with this issue.

It is worth putting on the record that this Government came into office inheriting a complete economic shambles. We are still having to borrow £120 billion just to pay for public expenditure this year and we are honouring our commitments on increasing funding to the NHS and on international development. Notwithstanding that, Ministers in the Department have maintained cash budgets for schools, which is no mean achievement. That should go on the record in this debate. Many hon. Members know that the only way to deal with this issue, and the unfairness that many of us are rightly raising, is to get the economy growing and get real economic growth. In a time of rising budgets, I believe that by doing so we will be able to make significant progress towards dealing with these inequalities. I should welcome some reassurance from the Minister that that will happen as the economy grows.

 The Minister of State, Department for Education (Mr Nick Gibb): It is a pleasure to serve under your chairmanship, Mr Gray. Let me begin by congratulating my hon. Friend the Member for Gloucester (Richard Graham) on securing a debate on a topic of great importance to us all; indeed, I met him and other colleagues on 12 March to discuss it.

I understand my hon. Friend’s concerns. Gloucestershire is ranked 136th out of 151 authorities for funding allocations per pupil. In 2011-12, funding per pupil was £4,661, compared with the national average of £5,082. My hon. Friend’s opening remarks and the whole debate reflect concerns across the sector about the school funding system.

My hon. Friend is the Martin Luther of school funding reform; indeed, I found a letter from the F40 chair, Councillor Ivan Ould, nailed to the door of the Department for Education. It listed four options or grievances, and we will respond to it in due course. I should, however, point out that option 3 would cost £99 million, which is not an insubstantial sum, given the current financial climate.

I pay tribute to my hon. Friend for the passion, commitment and perseverance he has shown in campaigning for a fairer funding system and formula. He has raised these issues on countless occasions, including when I visited Tredworth junior school, Finlay community school and Gloucester academy in his constituency last July. I also pay tribute to the work of my hon. Friend the Member for Worcester (Mr Walker), who has provided the leadership and steering for the F40 campaign in Parliament.

 I wholeheartedly agree with hon. Members that the current system for funding schools is in desperate need of reform. It is based on an assessment of need that dates back to at least 2005-06, if not further, so it has not kept pace with changing demographics and the needs of pupils across the country. It is also too complex and opaque, so head teachers and governing bodies are often unable to understand how their budgets have been calculated.

It is not right that schools with very similar circumstances can receive vastly different funding for no clearly identifiable reason. We have found that funding between similar secondary schools can vary by £1,800 per pupil. As my hon. Friend the Member for South West Bedfordshire (Andrew Selous) said, the neighbouring areas of Luton, which is poorer than central Bedfordshire, and Buckinghamshire, which is richer, receive more funding per pupil than central Bedfordshire. My hon. Friend the Member for Loughborough (Nicky Morgan) made a similar point, when she said that Leicestershire, which received the lowest amount in the country, received £900 less per pupil than the city of Leicester. That seems unfair.

As my hon. Friend the Member for Warrington South (David Mowat) said, there is a 50% discrepancy in funding between Warrington and Westminster local authorities. My hon. Friend the Member for Redditch (Karen Lumley) said that Redditch receives £1,000 per pupil less than Birmingham. My hon. Friend the Member for Kingswood (Chris Skidmore) noted that one side of the Sandwell road in his constituency receives £4,487 per pupil, while the other receives £5,469 per pupil. I have never been compared to Mr Gorbachev, but I accept the challenge to tear down these walls and end these absurd inequities.

 The Government remain committed to reforming the funding system so that it is fair, transparent and reflects the needs of pupils across the country. On 26 March, the Secretary of State for Education announced our intention to introduce a new national funding formula during the next spending period. I am sympathetic to my hon. Friends’ wish to see us move faster and address the system’s inequities much sooner. However, in reforming a system that is so entrenched, we need to proceed with caution, and it is important that we introduce full-scale reform at a pace that schools can manage. At a time of economic uncertainty, stability is crucial.

Our priority must be to ensure that schools are able to focus on delivering high educational standards and are not side-tracked by destabilising shifts to their funding. Attempting to introduce any dramatic change to the funding system at a time when we are, by necessity, addressing the budget deficit could cause problems in those schools where there might otherwise be significant changes in their funding.

We will move towards introducing a new funding system, but at a pace that gives us sufficient time to agree the construct of a new formula and that allows schools enough time to adjust to changes in their funding arrangements. Since last spring, we have consulted widely on how to create a funding system that is fair and logical and that distributes extra funding towards the pupils who need it most. The Department for Education has had a number of conversations with key groups, including schools, local authorities, unions and academies, to consider how we can move towards a fairer funding system.

The announcement made by the Secretary of State for Education on 26 March not only reaffirmed our commitment to introducing a new national funding formula during the next spending round, but set out detailed funding arrangements from next year. The funding arrangements from 2013-14 will make the local funding system simpler and more transparent for schools, early years provision and high-need pupils. Under the new arrangements, education provision will be funded on a much clearer, more comparable basis than under the current system. Head teachers, parents and governors will be able to see precisely how their budgets have been calculated, and why.

 The first step—we have heard a lot today about first steps, in various languages—to simplifying local funding will be to work on the basis that as many services and as much funding as possible will be devolved to schools. I firmly believe that schools are best placed to decide how to meet the needs of their pupils and to target funding effectively.

 Richard Graham: Just to clarify, I think that we all welcome the announcements made by the Education Secretary on 26 March, which will, as the Minister says, simplify things considerably; but does the Minister see that as a first step, which can be improved during this Parliament?

 Mr Gibb: It is certainly a first step, and an important one that should not be underestimated; but the national funding formula, to which we want to move in the longer term, will commence in the next spending review, not the present one.

 Our approach of simplifying local administration and the local formula and of maximum delegation to schools will give head teachers, principals and governors much more control over how funding is spent.

The second step on our journey is to reduce the number of factors that local authorities can use to distribute funding to schools. At present, they can use 37 factors when deciding how to allocate funding—a point that the hon. Member for Westminster North (Ms Buck) raised. Each of those 37 factors can be interpreted widely and applied in different ways. That has resulted in long and complex local formulae, with huge variations across the country. We are reducing the number of factors that local authorities can use from 37 to 10.

The 10 remaining factors are clearly defined and help to ensure that funding is used to support the attainment of pupils. They are a basic per-pupil entitlement; a deprivation element; an element for looked-after children; low-cost, high-incidence special educational needs; English as an additional language for the first three years after the pupil enters the system; a lump sum, and we are consulting on whether to set a maximum cap of between £100,000 and £150,000; split sites; rates; and private finance initiative contracts. Also, for the five local authorities some but not all of whose schools are within the London fringe area, we will allow some flexibility to reflect higher salary costs in those areas. No longer will local authorities fund schools based on historic factors that we consider less important, such as the number of trees, or the number of ditches surrounding the property. It is right that, at a time of austerity, funding should be focused on supporting pupils to achieve. Each local authority will be required to publish details of its formula on a simple, clear and consistent pro-forma.

To strengthen local decision-making, the third step will be to make some changes to the schools forum arrangements. We will make improvements to their composition and operation, so that their business is more transparent and decisions better reflect the views of education providers. For example, we expect that schools forums should operate similarly to other council committees. Meetings should be held in public and decisions should be publicised.

 Mr Buckland: An issue has arisen in the local authority in Swindon, where decisions on the allocation of moneys relating to the pupil premium have caused consternation, as some schools are entitled to more premium than others. I welcome my hon. Friend’s remarks about more transparency in schools forums. Mr Gibb: In 2013, those issues will be made public, so if some schools forums are redistributing the pupil premium in a way that was not intended, it will become clear and apparent.

 David Mowat: Are the 10 factors, which the Minister has read out, that are to be used within a local authority to achieve a fair allocation potentially the basis for a national funding formula by which the money would get to the local authorities in the first place, which is the nub of the problem?

Mr Gibb: My hon. Friend raises a good point. Those are the very issues on which we are consulting, in moving to a national formula. We must move away from the phenomenally complicated formulae that currently apply in allocating funds to local authorities.

To ensure that we are better placed to introduce a national funding formula over the coming years, we are also making changes that will substantially improve how local authorities are funded. They will continue to be allocated amounts for each pupil through the dedicated schools grant based on previous funding levels. The difference will be that that grant will be allocated in three notional blocks: for schools, early years and high-needs pupils. The notional blocks will not be ring-fenced, so local authorities will continue to have flexibility over how they spend their money. That approach will benefit pupils and schools from all sectors and phases.

We will use the October census, rather than the January census as we do now, to calculate budgets for the schools block. Therefore, mainstream maintained schools will receive their budgets earlier, giving them more time to plan. The separate high-needs block will help to secure a more transparent and sustainable approach to funding pupils with high needs. Schools and other providers will be expected to contribute to the costs of a pupil with high needs, up to a clearly defined threshold. Any cost above that threshold will need to be met from the high-needs block. That will ensure that funding for high-needs pupils is funded in an equivalent way, whatever type of institution they attend, and it will improve consistency when young people move from one part of the country to another. The early years block will continue to be funded on the basis of the January census, but that funding will be adjusted to reflect actual numbers by the end of the financial year, to take into account the fact that young children join the school system at different points in the year. It will ensure that local authorities have greater certainty about funding for early years children.

We are aware that we need to reform the administration of the local authority central spend equivalent grant, which is very dear to the heart of my hon. Friend the Member for Gloucester, so that there is greater comparability and transparency. We are exploring a new Department for Education grant that would substitute an element of the formula grant that is currently paid by the Department for Communities and Local Government. The new grant would cover relevant central educational services and be paid on a national basis, per pupil, to local authorities and academies. That, combined with the maximum devolution of funding to schools, would replace the need for LACSEG. Making the local system simpler and more transparent will mean that, when we come to address the national system, there will be far less complexity for us to untangle. This is the start of the process for which my hon. Friend the Member for Warrington South calls.

I am aware of the concerns covered in the opening remarks made by my hon. Friend the Member for Gloucester, including those about small schools, which were also discussed by other hon. Members during the debate. We have considered the additional needs of small rural schools in developing the new funding arrangements. As my hon. Friend the Member for South East Cornwall (Sheryll Murray) pointed out, very small schools are very expensive. We have built enough flexibility into the proposed system to allow local authorities and schools forums to support successful small schools—for example, through the lump sum that I referred to earlier.

In the remaining period of the spending review, schools are being funded at flat cash per pupil, in addition to which schools receive £600 per pupil eligible for free school meals. However, to support our proposed changes and to protect all schools, including small schools, from significant locally decided fluctuations in their budgets, we will continue to operate a minimum funding guarantee of minus 1.5% per pupil for 2013-14 and 2014-15. Therefore, in most circumstances, schools across the country can be assured that, over the next two years, their budgets will not be reduced by more than 1.5% per pupil each year.

Our analysis has shown that those measures will protect the majority of small schools. However, we are consulting on the issues and listening to all the sector’s concerns. Formal decisions on protection for small schools and, indeed, other areas of reform will be announced in the summer.

Speaking yesterday afternoon, Andrew Selous MP for South West Bedfordshire said

“I want to express my deepest sympathy to the family and friends of the man who was killed when his glider crashed in Eaton Bray this afternoon, and I will be looking to see that all lessons are learnt from this sad incident so that we can avoid any sad tragedy in future”

Speaking after the debate, Andrew Selous said, “It is not fair that our neighbouring areas, Luton and Buckinghamshire, one richer and one poorer than Central Bedfordshire, both receive more money than Central Bedfordshire children do.  I welcome the Government’s decision to change the funding formula to deal with this unfairness and to give greater certainty and clarity to schools over their budgets”. 

The exchange in Hansard was as follows:

Andrew Selous (South West Bedfordshire) (Con): Let me be the first to congratulate my hon. Friend the Member for Gloucester (Richard Graham) on a superb introduction to this important issue, which has drawn a large number of hon. Members to the Chamber. It would have been nice to see a few hon. Members from Her Majesty’s Opposition, but they seem to be somewhat absent. I congratulate my hon. Friend on the sensitive way in which he has raised this important issue.

We all have a duty to speak up for our constituents. Central Bedfordshire council is in the unique position of having a local authority on one side of it, Luton, which is generally poorer than central Bedfordshire, and a local authority on the other side of it, Buckinghamshire, which is richer. Both authorities receive more money per child than central Bedfordshire. I put it to the Minister that it is very hard, as a Bedfordshire MP, to explain to my constituents why the authorities on either side, one of which is poorer and one of which is richer, receive more money. It makes an eloquent case for why the formula has no logic or rationale.

Each child in central Bedfordshire receives £4,658, compared with a child in Luton who receives £5,315 and a child in Buckinghamshire who receives £4,814. A child in Luton gets £657 more and a child in wealthier Buckinghamshire, our neighbour, gets £156 more. Every political party across the spectrum in central Bedfordshire is unhappy about that. The leader of Central Bedfordshire council wrote to the Secretary of State on 25 January to express the views of the whole council on this matter.

Some hon. Members have already mentioned that relatively wealthy areas often have significant pockets of deprivation. That is true in my constituency. There is deprivation in Houghton Regis, for example. The indices of multiple deprivation in some wards in that town are not dissimilar to those in much higher-funded Luton next door. The formula fails poorer children in wealthier areas. We need to look at that to see whether the formula could drill down and give additional funding for poorer children in slightly wealthier areas.

This Government made an impressive start on this issue by publishing “School funding reform: next steps towards a fairer system” a few weeks ago. I am grateful to the Minister and his colleagues at the Department for recognising the problem and setting out a route map for dealing with this issue.

It is worth putting on the record that this Government came into office inheriting a complete economic shambles. We are still having to borrow £120 billion just to pay for public expenditure this year and we are honouring our commitments on increasing funding to the NHS and on international development. Notwithstanding that, Ministers in the Department have maintained cash budgets for schools, which is no mean achievement. That should go on the record in this debate. Many hon. Members know that the only way to deal with this issue, and the unfairness that many of us are rightly raising, is to get the economy growing and get real economic growth. In a time of rising budgets, I believe that by doing so we will be able to make significant progress towards dealing with these inequalities. I should welcome some reassurance from the Minister that that will happen as the economy grows.

The Minister of State, Department for Education (Mr Nick Gibb): It is a pleasure to serve under your chairmanship, Mr Gray. Let me begin by congratulating my hon. Friend the Member for Gloucester (Richard Graham) on securing a debate on a topic of great importance to us all; indeed, I met him and other colleagues on 12 March to discuss it.

I understand my hon. Friend’s concerns. Gloucestershire is ranked 136th out of 151 authorities for funding allocations per pupil. In 2011-12, funding per pupil was £4,661, compared with the national average of £5,082. My hon. Friend’s opening remarks and the whole debate reflect concerns across the sector about the school funding system.

My hon. Friend is the Martin Luther of school funding reform; indeed, I found a letter from the F40 chair, Councillor Ivan Ould, nailed to the door of the Department for Education. It listed four options or grievances, and we will respond to it in due course. I should, however, point out that option 3 would cost £99 million, which is not an insubstantial sum, given the current financial climate.

I pay tribute to my hon. Friend for the passion, commitment and perseverance he has shown in campaigning for a fairer funding system and formula. He has raised these issues on countless occasions, including when I visited Tredworth junior school, Finlay community school and Gloucester academy in his constituency last July. I also pay tribute to the work of my hon. Friend the Member for Worcester (Mr Walker), who has provided the leadership and steering for the F40 campaign in Parliament.

I wholeheartedly agree with hon. Members that the current system for funding schools is in desperate need of reform. It is based on an assessment of need that dates back to at least 2005-06, if not further, so it has not kept pace with changing demographics and the needs of pupils across the country. It is also too complex and opaque, so head teachers and governing bodies are often unable to understand how their budgets have been calculated.

It is not right that schools with very similar circumstances can receive vastly different funding for no clearly identifiable reason. We have found that funding between similar secondary schools can vary by £1,800 per pupil. As my hon. Friend the Member for South West Bedfordshire (Andrew Selous) said, the neighbouring areas of Luton, which is poorer than central Bedfordshire, and Buckinghamshire, which is richer, receive more funding per pupil than central Bedfordshire. My hon. Friend the Member for Loughborough (Nicky Morgan) made a similar point, when she said that Leicestershire, which received the lowest amount in the country, received £900 less per pupil than the city of Leicester. That seems unfair.

As my hon. Friend the Member for Warrington South (David Mowat) said, there is a 50% discrepancy in funding between Warrington and Westminster local authorities. My hon. Friend the Member for Redditch (Karen Lumley) said that Redditch receives £1,000 per pupil less than Birmingham. My hon. Friend the Member for Kingswood (Chris Skidmore) noted that one side of the Sandwell road in his constituency receives £4,487 per pupil, while the other receives £5,469 per pupil. I have never been compared to Mr Gorbachev, but I accept the challenge to tear down these walls and end these absurd inequities.

The Government remain committed to reforming the funding system so that it is fair, transparent and reflects the needs of pupils across the country. On 26 March, the Secretary of State for Education announced our intention to introduce a new national funding formula during the next spending period. I am sympathetic to my hon. Friends’ wish to see us move faster and address the system’s inequities much sooner. However, in reforming a system that is so entrenched, we need to proceed with caution, and it is important that we introduce full-scale reform at a pace that schools can manage. At a time of economic uncertainty, stability is crucial.

Our priority must be to ensure that schools are able to focus on delivering high educational standards and are not side-tracked by destabilising shifts to their funding. Attempting to introduce any dramatic change to the funding system at a time when we are, by necessity, addressing the budget deficit could cause problems in those schools where there might otherwise be significant changes in their funding.

We will move towards introducing a new funding system, but at a pace that gives us sufficient time to agree the construct of a new formula and that allows schools enough time to adjust to changes in their funding arrangements. Since last spring, we have consulted widely on how to create a funding system that is fair and logical and that distributes extra funding towards the pupils who need it most. The Department for Education has had a number of conversations with key groups, including schools, local authorities, unions and academies, to consider how we can move towards a fairer funding system.

The announcement made by the Secretary of State for Education on 26 March not only reaffirmed our commitment to introducing a new national funding formula during the next spending round, but set out detailed funding arrangements from next year. The funding arrangements from 2013-14 will make the local funding system simpler and more transparent for schools, early years provision and high-need pupils. Under the new arrangements, education provision will be funded on a much clearer, more comparable basis than under the current system. Head teachers, parents and governors will be able to see precisely how their budgets have been calculated, and why.

The first step—we have heard a lot today about first steps, in various languages—to simplifying local funding will be to work on the basis that as many services and as much funding as possible will be devolved to schools. I firmly believe that schools are best placed to decide how to meet the needs of their pupils and to target funding effectively.

Richard Graham: Just to clarify, I think that we all welcome the announcements made by the Education Secretary on 26 March, which will, as the Minister says, simplify things considerably; but does the Minister see that as a first step, which can be improved during this Parliament?

Mr Gibb: It is certainly a first step, and an important one that should not be underestimated; but the national funding formula, to which we want to move in the longer term, will commence in the next spending review, not the present one.

Our approach of simplifying local administration and the local formula and of maximum delegation to schools will give head teachers, principals and governors much more control over how funding is spent.

The second step on our journey is to reduce the number of factors that local authorities can use to distribute funding to schools. At present, they can use 37 factors when deciding how to allocate funding—a point that the hon. Member for Westminster North (Ms Buck) raised. Each of those 37 factors can be interpreted widely and applied in different ways. That has resulted in long and complex local formulae, with huge variations across the country. We are reducing the number of factors that local authorities can use from 37 to 10.

The 10 remaining factors are clearly defined and help to ensure that funding is used to support the attainment of pupils. They are a basic per-pupil entitlement; a deprivation element; an element for looked-after children; low-cost, high-incidence special educational needs; English as an additional language for the first three years after the pupil enters the system; a lump sum, and we are consulting on whether to set a maximum cap of between £100,000 and £150,000; split sites; rates; and private finance initiative contracts. Also, for the five local authorities some but not all of whose schools are within the London fringe area, we will allow some flexibility to reflect higher salary costs in those areas. No longer will local authorities fund schools based on historic factors that we consider less important, such as the number of trees, or the number of ditches surrounding the property. It is right that, at a time of austerity, funding should be focused on supporting pupils to achieve. Each local authority will be required to publish details of its formula on a simple, clear and consistent pro-forma.

To strengthen local decision-making, the third step will be to make some changes to the schools forum arrangements. We will make improvements to their composition and operation, so that their business is more transparent and decisions better reflect the views of education providers. For example, we expect that schools forums should operate similarly to other council committees. Meetings should be held in public and decisions should be publicised.

Mr Buckland: An issue has arisen in the local authority in Swindon, where decisions on the allocation of moneys relating to the pupil premium have caused consternation, as some schools are entitled to more premium than others. I welcome my hon. Friend’s remarks about more transparency in schools forums.

Mr Gibb: In 2013, those issues will be made public, so if some schools forums are redistributing the pupil premium in a way that was not intended, it will become clear and apparent.

David Mowat: Are the 10 factors, which the Minister has read out, that are to be used within a local authority to achieve a fair allocation potentially the basis for a national funding formula by which the money would get to the local authorities in the first place, which is the nub of the problem?

Mr Gibb: My hon. Friend raises a good point. Those are the very issues on which we are consulting, in moving to a national formula. We must move away from the phenomenally complicated formulae that currently apply in allocating funds to local authorities.

To ensure that we are better placed to introduce a national funding formula over the coming years, we are also making changes that will substantially improve how local authorities are funded. They will continue to be allocated amounts for each pupil through the dedicated schools grant based on previous funding levels. The difference will be that that grant will be allocated in three notional blocks: for schools, early years and high-needs pupils. The notional blocks will not be ring-fenced, so local authorities will continue to have flexibility over how they spend their money. That approach will benefit pupils and schools from all sectors and phases.

We will use the October census, rather than the January census as we do now, to calculate budgets for the schools block. Therefore, mainstream maintained schools will receive their budgets earlier, giving them more time to plan. The separate high-needs block will help to secure a more transparent and sustainable approach to funding pupils with high needs. Schools and other providers will be expected to contribute to the costs of a pupil with high needs, up to a clearly defined threshold. Any cost above that threshold will need to be met from the high-needs block. That will ensure that funding for high-needs pupils is funded in an equivalent way, whatever type of institution they attend, and it will improve consistency when young people move from one part of the country to another. The early years block will continue to be funded on the basis of the January census, but that funding will be adjusted to reflect actual numbers by the end of the financial year, to take into account the fact that young children join the school system at different points in the year. It will ensure that local authorities have greater certainty about funding for early years children.

We are aware that we need to reform the administration of the local authority central spend equivalent grant, which is very dear to the heart of my hon. Friend the Member for Gloucester, so that there is greater comparability and transparency. We are exploring a new Department for Education grant that would substitute an element of the formula grant that is currently paid by the Department for Communities and Local Government. The new grant would cover relevant central educational services and be paid on a national basis, per pupil, to local authorities and academies. That, combined with the maximum devolution of funding to schools, would replace the need for LACSEG. Making the local system simpler and more transparent will mean that, when we come to address the national system, there will be far less complexity for us to untangle. This is the start of the process for which my hon. Friend the Member for Warrington South calls.

I am aware of the concerns covered in the opening remarks made by my hon. Friend the Member for Gloucester, including those about small schools, which were also discussed by other hon. Members during the debate. We have considered the additional needs of small rural schools in developing the new funding arrangements. As my hon. Friend the Member for South East Cornwall (Sheryll Murray) pointed out, very small schools are very expensive. We have built enough flexibility into the proposed system to allow local authorities and schools forums to support successful small schools—for example, through the lump sum that I referred to earlier.

In the remaining period of the spending review, schools are being funded at flat cash per pupil, in addition to which schools receive £600 per pupil eligible for free school meals. However, to support our proposed changes and to protect all schools, including small schools, from significant locally decided fluctuations in their budgets, we will continue to operate a minimum funding guarantee of minus 1.5% per pupil for 2013-14 and 2014-15. Therefore, in most circumstances, schools across the country can be assured that, over the next two years, their budgets will not be reduced by more than 1.5% per pupil each year.

Our analysis has shown that those measures will protect the majority of small schools. However, we are consulting on the issues and listening to all the sector’s concerns. Formal decisions on protection for small schools and, indeed, other areas of reform will be announced in the summer.

18,800 SOUTH WEST BEDFORDSHIRE PENSIONERS TO BE £15,000 BETTER OFF OVER THEIR RETIREMENT

Andrew Selous MP for South West Bedfordshire has welcomed the biggest ever cash rise in the Basic State Pension coming into effect this month.

The Government’s new ‘triple lock’ guarantee on the Basic State Pension ensures it rises every year with inflation, earnings or 2.5 per cent – whichever is the highest. This week, it will rise by £5.30 a week or £275 a year. As a result of the triple lock, pensioners will be an average of £15,000 better off over the course of their retirement.

This comes on top of the Government’s decision to protect pensioner benefits – winter fuel payments, free prescriptions and eye tests, free bus travel and free TV licences for older the over 75s – as it deals with the record budget deficit and debt inherited from Labour.

Andrew Selous MP said:

‘Thanks to the Conservatives in government, 18,800 pensioners people in South West Bedfordshire will take home, the largest ever increase in the state pension, an extra £5.30 a week from this month.

‘For 13 years, Labour promised to restore the link between earnings and the State Pension, but did nothing. This resulted in older people getting paltry pension increases – as little as 75 pence one year.

‘But the Conservatives in government have reformed the State Pension, introducing the triple lock, which ensures that pensions always rise by the greatest of inflation, earnings or 2.5 per cent. This will benefit pensioners by an average of £15,000 over their retirement.’

Keeping the NHS healthy for the future

The NHS continues to be one of our most cherished institutions. I know from my constituency work how much it means to local people and I hear far more praise for it than I hear criticism.  My own family rely on the NHS and it was there for me when I needed it in my twenties, receiving a life saving operation in the middle of the night.  I am very proud that the Government is continuing to put an extra £12 billion a year into the NHS every year, in spite of the huge deficit that we are still dealing with.

I am well aware many people in Leighton Buzzard, including me, still want to see a community hospital and I continue to investigate how this could be achieved, perhaps by making better use of some of the unused NHS beds in the town.   I do very much welcome the opening of the new Grovebury Road Surgery which will have much more space to treat patients and will also be able to offer a wider range of treatments in Leighton Buzzard to save patients having to travel to local hospitals as much as at present.

In Dunstable the case of young Lilly MacGlashan who is being treated for cancer in New York has lead to an outpouring of generosity and I am taking up the issues raised by the Neuroblastoma Alliance which supports families like the MacGlashans.  It is also good to see the innovative work being undertaken by Central Bedfordshire Council at the Greenacres Care Home in Dunstable which is helping more elderly people to stay out of hospital.

Health remains a top priority nationally and the number of patients waiting over 18 weeks for treatments is now at the lowest level ever.  The number of patients in mixed sex wards in hospitals has also been reduced by 95%.  There are now 15,000 less administrators in the NHS, including almost 6,000 fewer managers and 4,000 extra doctors.  Almost 12,000 extra patients have benefitted from the new cancer drugs fund.

The challenges facing the NHS in the future are enormous though.  The number of people aged over 85 will double in the next 20 years and this age group are, unsurprisingly, major users of the NHS.  The cost of the drugs used by the NHS has been increasing by £600 million per year.  These are reasons why doctors and nurses are being given more freedom to control their budgets for the benefit of their patients.  Patients will also be given more information to enable them to have a greater say over the care they receive.  More democratic accountability will be provided locally by Councils who will bring the NHS, social care and public health services together to plan services in the best interests of local communities.  In order to redirect more money to frontline care, two whole levels of bureaucracy will be cut from the NHS to save £4.5 billion, every penny of which will go towards patient care.

Hardworking people across the South West Bedfordshire Constituency will be up to £220 better off next year thanks to the largest ever increase in the personal allowance announced by George Osborne in the Budget.
 
In his 2012 Budget the Chancellor announced that the income tax personal allowance will be increased from April 2013 by an additional £1,100 to £9,205. This increase will give 37,815 in South West Bedfordshire a much needed boost every month.
 
This means that income tax has been cut by up to £546 for basic rate taxpayers since the Government came to power and 2 million of the lowest earners will have been taken out of tax altogether.
 
Welcoming the decision, Andrew Selous MP for South West Bedfordshire, said:
 
“This is fantastic news for South West Bedfordshire and will further cut the tax bill of 37,815 people by up to £220 next year. Thanks to this decision, 1,289 number of people in South West Bedfordshire will be taken out of tax altogether. This means that 3,145 in South West Bedfordshire will have been lifted out of income tax altogether by this Government.
 
“The announcement shows that this Government is committed to helping hard-working families in South West Bedfordshire and across the UK”.

Building A Secure Future

I was delighted to learn last week that social housing tenants who rent from a local authority, or housing association tenants whose home was part of a stock transfer from a local authority are to be offered discounts of up to £75,000 to buy their home, a more than doubling of the previous maximum discount allowed in our area of £34,000.  It is absolutely right that we give more people the chance of owning their own home.  Right to buy sales have declined dramatically in recent years from a peak of 84,000 less than 10 years ago to a mere 3,700 last year. 

Right to buy enables decent, hard working people on lower incomes a helping hand into owner-occupation, enabling households to own their own homes who would never otherwise have been able to do so.  Once monolithic and mono-tenure estates can benefit from an increased sense of shared ownership and social responsibility.  New front doors can signal new life and diversity in housing estates.

For the first time, homes sold under the right to buy will be replaced by new properties for affordable rent, ensuring there is no reduction in the number of affordable homes.  A further 100,000 homes will be built from the money raised in addition to a further 100,000 homes that will be built by the release of public sector land. This will work on the same model as the Affordable Homes Programme which is delivering up to 170,000 new affordable homes by 2015.  I am pleased that these plans will support the dreams of council and some housing association tenants who want to own the roof over their head.

The recent Budget was the most pro-enterprise budget in a generation.  We are making it easier to set up and run a business than ever before by creating the most competitive business tax system in the developed world.  We are also cutting red tape by scrapping regulations that cost British business over £350 million a year.  Our low borrowing costs are also good for business and home owners and over the past year businesses have responded by investing £119 billion across the economy, up £3 billion on the year before.  That is why the IMF has forecast the UK to grow twice as fast as Germany and three times as fast as France this year.  The only way out of the economic mess we inherited is to earn our way out and over the last three years the private sector has created half a million extra jobs, but of course we need many more.

Finally, in spite of some media commentary, I am delighted that pensioners are now benefitting from the largest ever cash increase in their pensions of £5.30 per week from this month.  That was made possible by the restoration of the earnings link and our improvement of it to ensure that pensions always increase by the highest of earnings, prices or 2.5%, so there can never be another 75 pence increase for pensioners.  In addition the Winter Fuel  payments, free prescriptions and eye tests, free bus travel and free eye tests have all been protected and over 90% of the country, including Central Bedfordshire, took advantage of the Government’s offer to freeze Council Tax for the second year running.