Madam Speaker, with permission, I wish to make a statement on education excellence in cities.

On 11 March, I announced to the House that, with the extra investment in public services from the Budget, we would provide much wider access to information technology—with a clear focus on the inner cities. In our White Paper "Excellence in schools", we promised to modernise the comprehensive principle. Today, I can announce a major new framework for our inner-city schools—taking those principles forward in the six largest cities in England. It means shifting the focus decisively from the institution to the individual, irrespective of geography or birth, so that every gifted pupil will be stretched and special needs met. It means a substantial expansion of specialist and beacon schools promoting diversity and excellence. It means that every youngster who would benefit will have access to a learning mentor, with extra help available for those who need it most. This strategy will give every pupil an entitlement to new and more challenging opportunities.

There are particular problems in inner cities which have created a long-standing culture of low expectation. Today's action plan—which will be backed by £350 million over the next three years—will build on measures already taken to raise achievement. Sure start and expanded nursery education will give every child the best possible start in life. The daily literacy hour is teaching children to read, write and spell effectively for the first time in 30 years. From September, our numeracy strategy will restore mental arithmetic—including speed in performing it—to maths teaching. That is underpinned by a rapid reduction in infant class sizes.

Many teachers and pupils are already performing very well in difficult circumstances. We must build on and spread their success. Just as the city multiplies the barriers, we have to multiply the opportunities. Initially, our action plan will be taken forward in six areas—inner and north-east London; Manchester and Salford; Liverpool and Knowsley; Birmingham; Leeds and Bradford; and Sheffield and Rotherham.

What about Bolsover?

Not the first time around. As the programme develops, we will link into other initiatives for regeneration and spread success.

We will strengthen leadership in our inner-city schools and provide gifted pupils with new opportunities to succeed. That means setting pupils into appropriate groups in their own schools as well as extra classes linked to specialist schools. If a child with a talent for languages wishes to study German or Italian, but their own school offers only French, that child should be able to do so.

All of us want to ensure that those who have the ability to go to university can do so. We will establish new university summer schools for 16 and 17-year-olds in inner-city schools and post-16 colleges. They will build on links already developed by individual schools and colleges with some universities.

Many youngsters in our inner cities lose out because they drop out. All secondary school pupils in those areas who need one will have access to a learning mentor to assist in overcoming barriers—someone who can cut through red tape to offer support. That will benefit those who have traditionally been failed by the system, especially children from minority ethnic and disadvantaged backgrounds. This year, we will make a start, with £17 million to employ more than 800 mentors in our schools. Mentors will guide pupils towards extra help and tuition when they are falling behind.

Nor can we allow disruptive pupils to wreck the chances of others. Excluded youngsters miss out on education and often turn to crime. Seventy-five per cent. of those on remand have a reading age of 10 or below. We are already acting to tackle those problems. I propose that every secondary school should have access to a learning unit for disruptive youngsters, who will receive a full timetable and will return to class only when they can do so without disruption.

Turnover and the use of supply teachers are major challenges to the continuity of education in our cities. We will introduce new measures to attract and retain good teachers through enhanced retention bonuses and targeted training and development programmes.

Alongside today's measures, we are strengthening diversity and excellence across the education system. I can announce the expansion of our existing target for specialist schools from 500 to at least 800 by 2002. That will mean that nearly one in four secondary schools in England will offer a specialism linked to neighbouring schools and colleges.

Our new network of learning centres will include specialist schools with strong information and communication technology and a focus on adult computer learning. The first 80 centres will be placed in our inner-city areas, at a cost of £100 million. I can also announce a fivefold increase in our beacon school programme, from the current planned number of 200 by September to 1,000 by 2002.

There has been great enthusiasm for education action zones, and we will invest up to £24 million to extend the programme to support an additional 40 smaller zones. We will also accelerate inspections by the Office for Standards in Education of inner local education authorities.

I am pleased to say that, to spearhead this drive, my right hon. Friend the Prime Minister has today appointed my hon. Friend the Minister for School Standards to hold special responsibility for inner-city education. She will lead a strategy group that will include successful heads.

For too long, the specific educational characteristics of inner cities have been ignored. Today, I believe that we have set in train action that will lead to a step change in aspiration and expectation. Our ambition is real diversity and excellence, from world-class primary education to a comprehensive system that works for all our children, whatever their background.

I commend the statement to the House.

I begin by asking the Secretary of State to clarify some important aspects of his statement. What does it mean when we are told that the networks for more able pupils will sometimes be based in beacon schools and that extra classes will be linked to specialist schools? Are Ministers seriously suggesting that more able pupils should be bussed to other schools for special lessons? Is that what the right hon. Gentleman is telling the House?

Will the Secretary of State also confirm that the Government ban specialist schools from selecting by ability? Such schools can specialise in music, but not in maths. Is the right hon. Gentleman now saying that one can be bussed to a specialist or beacon school because of one's ability in maths, but one cannot be enrolled there for that reason? Is the right hon. Gentleman not simply tying himself up in knots because of his record of hostility to selection?

Will the Secretary of State confirm that he promised the Labour party that there would be no selection by examination or interview? So what procedure will be used to identify for special treatment the most able 5 or 10 per cent. of pupils referred to in his document?

As for the special classes that are to take place in pupil's own schools, but after hours or on Saturday mornings, why can those special lessons not take place during the school day? If they do, we will be back to setting in existing schools. We support setting, which should be spread further, but, on its own, it hardly constitutes the transformation of inner-city education.

The Secretary of State famously remarked:

"I'm having no truck with middle class left wing parents who preach one thing and send their children to another school outside the area."

Who was he thinking of and is it now all right to do that, provided it is on a bus to a learning centre?

We welcome university summer schools and commend the work that Mr. Peter Lampl and others have already done in establishing them. Mentoring can also be a useful way to help pupils, and we welcome that too. But what qualifications will mentors have? Will they be members of the teaching staff? Will they be responsible to the governing body and the head teacher? How are 800 mentors to take responsibility for every child in every secondary school in the target areas.

What about access to a learning unit? How many places will there be? Will they be in each school or will they be external units? Will existing pupil referral units be closed.

The Secretary of State makes great play of the money that will go to inner-city schools, but will he confirm that it is part of the education settlement that has already been announced? How will the money get to schools? Is the Secretary of State aware of the frustration and anger in schools when they hear yet another announcement from the Government, but know that it is financed out of money that should have gone to them as part of their core funding? Instead, that money is held back for another departmental initiative.

Is there not hopeless confusion at the heart of the Government's education policies? The Government have spent two years attacking any attempts by schools to specialise in more able pupils. Schools are losing power over their admissions policies, they will no longer be able to select pupils by ability and, of course, grammar schools are under threat. Now, the Government have suddenly come up with this scheme for selecting more able pupils in inner-city comprehensives. Why is that form of selection by ability imposed, whereas all existing forms are banned?

I am grateful for the warm welcome that the hon. Gentleman gave to the statement about raising standards and giving real opportunity to inner-city children. I am only sorry that the Opposition have not got any ideas of their own, other than returning to the policy of taking some children out of the area to grammar schools and leaving the other 80 per cent. to sink. We are proposing not bussing children, but giving them enhanced opportunities based on the fact that the majority of children are rooted in and will go to their local schools. The very nature of supply and demand ensures that that is the case. Therefore, we have to deal with that reality.

It is essential that we build on the after-school study centres, the university of the first age, which has been pioneered in Birmingham, the summer and Easter school programme and the Saturday schools, which are so popular, in particular, with ethnic minority children, to ensure that we do what the rich have always taken for granted—give children extra tuition when they need it, whether they need special needs support or are gifted. The rich buy tutors for themselves, provide crammers at Easter and in the summer, and condemn anyone else who seeks to have such provision at public expense. Instead of bussing a handful of children into successful selective schools somewhere else, we are going to transform the level of education for the majority of our children in the schools that they have to attend. Everyone can benefit from the programme in those areas and, if the programme is successful, we shall spread it across the country. Selection was an anachronism; providing excellence in the schools to which children actually go is common sense.

The hon. Gentleman asked how we would identify pupils who had particular talents. As I described in my statement, teachers know that, when there is setting rather than streaming, those children who are in the top set and have a particular gift for a particular subject need extra support to stretch them. Giving them additional classes or extra help, perhaps through new technological links between schools—that is now being done not only within this country, but between countries—and using our imagination to develop real diversity makes sense to everybody. If we can make this programme work, sending children outside their area will be a thing of the past. We can ensure that children who are rooted in their neighbourhood can have the standard of education that others have taken for granted.

The hon. Gentleman asked me about mentors and learning units. The initial trawl of 800 for the coming year will be full-time professionals recruited from teaching and educational welfare officer posts and elsewhere. They will organise volunteers, as well as give direct help to pupils and their families. They will provide a link between the school and the home and will form a network giving extra support to pupils in and out of school. The learning units for disaffected children will be in-school units and will ensure that children return to the classroom if and when they are in a position to do so. There will be a full timetable—which never happened under the Conservative Government.

The hon. Gentleman asked me about new money. As I pointed out in my statement, £100 million of the £350 million is indeed money that was announced on 11 March as part of the investment in learning centres. The remaining £250 million over three years is money that was not previously announced; it is being taken from our reserves—because each Department now has reserves—and has been identified within our budget to take the programme forward. I am pleased that agreement has been reached with my right hon. Friends the Prime Minister and the Chancellor to make the programme possible.

Unlike the gifted shadow spokesman, the hon. Member for Havant (Mr. Willetts), I welcome the emphasis on highly able children. We must acknowledge that we have neglected the highly able for too long in our education system, under the comprehensive approach. The Select Committee report on highly able children will be published shortly after Easter.

May I ask my right hon. Friend what he thinks about the relationship between inner-city schools and disadvantaged schools, given that not all inner-city schools are disadvantaged and not all disadvantaged schools are in the inner city? Will it be possible for the extremely disadvantaged schools in outer-London boroughs, such as my own, and those in rural areas and out-of-town housing estates to be brought into the next phase of this excellent programme?

The document that we are publishing this afternoon addresses those issues throughout the country, as well as in the six identified areas. The specialist school programme, the expansion to 1,000 of beacon schools and the support necessary for them, including the mini education action zones, will deal with those issues and will include a specific concentration on the 200 schools across the country that face the greatest challenge. We are monitoring those schools, which will receive special support and help. The programme is targeted on the six areas outlined, but is available to support the work of those schools facing disadvantage wherever they are in England.

Liberal Democrats welcome anything that addresses the damage that took place over the past 18 years. Primarily, we welcome the recognition that in our inner cities, especially in failing schools, there is a host of very bright and gifted children. It is sad that the Education Acts of 1981 and 1996 failed to recognise such children under the category of special needs. Unlike the hon. Member for Havant (Mr. Willetts), I spent a lot of time in Leeds in an inner-city school of exactly the sort that will benefit from the initiative. We saw the effects of pupils drifting away and of staff being unable to get to grips with gifted children because of a host of problems.

However, I have to tell the Secretary of State, with all humility, as one who has worked in that area, that the thrust of his argument today is wrong. By saying that children can succeed only if they move to specialist schools or into EAZs, we are telling the rest of those schools and their teachers that they are failing—that is the reality of what has been said today. Will the Secretary of State make clear how schools are to be selected, and how pupils within those schools are to be selected to comprise the 10 per cent. who will gain? Will he rule out another bidding process, which I see on the horizon? Will he consider the 1996 legislation on special educational needs and include gifted children as a category, so that all gifted children, whichever school they attend, can gain from new legislation?

First, I applaud the hon. Gentleman for his work in Leeds; we are aware of the excellent contribution that he made and the lessons that he learned, so I am happy to take on board his suggestions about the programme, whether he makes them here or at another time. However, I have to disabuse him of a misunderstanding: we do not intend to select individual schools which will then have their pupils picked out as gifted children; rather, we are talking about all gifted children who have the ability to be stretched being able to benefit from the programme after having been identified by teachers through the setting and grouping process, which I described earlier. The children will not be taken out of their schools, and the schools that will benefit are not confined to those in EAZs; this is a universal programme.

Learning centres and the development of specialist schools will provide a network which can be drawn on by all schools, which will be able to link into neighbouring schools. The fact that one in four schools will be specialist schools will enable that linkage to take place easily, without disruption, and it will ensure that staff, equipment, materials and expertise can be shared. The beacon schools programme will enable schools to link with other schools. It is about sharing and working co-operatively, and about having a family of schools, not the market that was created by the Conservatives. It is about the system as a whole being geared to developing and supporting the needs of the individual.

Yes, I believe that gifted children should be included in the special needs category. In the foreword to the Green Paper "Excellence for all children: Meeting Special Educational Needs", I said:

"Good provision for SEN does not mean a sympathetic acceptance of low achievement. It means a tough-minded determination to show that children with SEN are capable of excellence."

Children, whatever their background and whether or not they have a disability, will get the education that they need and deserve.

Is my right hon. Friend aware that the response of the hon. Member for Havant (Mr. Willetts), who, in a refined use of the verb, wants understanding of the issue, validates the statement made by Mr. Michael Portillo that, when one hears the word "teacher", one knows that that individual will not vote Conservative?

We who represent inner-city schools are well aware of the huge reservoir of talent among all children; it exists in the 14,000 children who attend state schools in my constituency, as well as in those who attend the three assisted places schools in my constituency. Their talents require encouragement at every level, and that is what my right hon. Friend is doing. Is he aware that schools that assist such striving for excellence should be encouraged?

My right hon. Friend speaks, rightly, about the inclusion of information and communications technology in his programme, so will he take account of the fact that Spurley Hey high school in my constituency, which he has just reprieved from closure but whose future remains in doubt, has a superbly equipped information and communications technology department, which should be allowed to continue its work indefinitely?

I knew that my right hon. Friend would get around to Spurley Hey high school. My hon. Friends and I will be happy to take account of the facilities and resources at that school. I agree entirely with the thrust of my right hon. Friend's contribution. I shall never forget the introduction to the Loyal Address when my right hon. Friend outlined clearly the disadvantages suffered by pupils in his constituency and the fact that so few of them were able to benefit from the resources available to Manchester grammar school.

May I offer my full and enthusiastic support to the Secretary of State and his statement and sincerely congratulate him on his courage in facing up to the nightmare of class segregation education, which is the inevitable consequence of having comprehensive schools in inner-city areas? Is the Secretary of State aware of the one problem associated with having mini grammar schools on each subject within comprehensive schools—pupils will feel that they have been excluded unfairly? If there is to be no 11-plus exam or something like it, will the Secretary of State at least ensure that there is some kind of appeal mechanism to help parents who believe that their children have been excluded unfairly from special education?

I welcome the thrust of the hon. Gentleman's remarks. The admissions policy, which was agreed last Thursday, endeavours to square the circle when supply and demand are out of kilter and it is necessary to ensure that there are fair and transparent methods of allowing parents to allocate a preference in the face of competing demands. We face a real challenge in ensuring that specialist schools do not become the preferred beacon, but are able to share their resources with neighbouring schools, so that we may link schools together. School collaboration will overcome the inevitable demand on scarce resources that arises when parents perceive one school as being better than another.

Is my right hon. Friend aware that this afternoon's statement, combined with the Government's other education initiatives, will be very welcome in inner-city Liverpool, where talent has been ignored for far too long? Will he explain how the initiatives announced today will further assist schools such as Windsor Street and Shorefield, which have already been identified as schools that are working hard to give added value to pupils in inner-city Liverpool? How will the scheme work? Will my right hon. Friend provide guidance on how proposals submitted for education action zones may be affected by this afternoon's statement?

I am happy to answer that question. The policy paper that we are publishing today provides further answers—although I appreciate the fact that right hon. and hon. Members have not yet had an opportunity to read it.

We will ensure that the mini-zones encompass a secondary school and a cluster of primary schools in an area. We will provide an additional £250,000 a year for three years, plus a matching pound for pound for the next £50,000 of sponsorship money that is raised by the schools. This is a mini-version of the broader education action zones, and it will benefit many schools when it is appropriate to focus on a group of schools.

The mentoring programme will be available directly to schools, as will the in-house units for disruptive and disaffected students. Pupils will be able to draw on the expertise of other schools through the linkage with beacon schools, which I described this afternoon. Excellence and experience will be spread to other schools—in the case of my hon. Friend, to schools in the Liverpool and Merseyside area. Much good work is going on. I celebrate it, and I applaud the teachers who are doing that work. This is an opportunity to back those teachers by ensuring that they are able to work better.

Will the Secretary of State put a little more flesh on the bones of the issue of how the ability of the 10 per cent. of gifted children will be assessed?

I must stress that the initiative is not about a rigid figure of 10 per cent.; it is about recognising the particular talents or needs of individual children and saying that the historic situation arising from geography or birth will no longer restrain a youngster's ability to flourish. Wherever children are, they should be given the support that they need to be able to stretch their talent and do better.

If a school believes that, to develop a talent—whatever the subject—a child would benefit from extra help, it will be able to use the additional after-school facilities that we shall extend, the weekend and summer schools that we shall develop and the links with the expertise that might exist in another school. For example, only one state school in Sheffield, which has a population of 500,000, offers Latin. I should like other children in the city who think that they had an aptitude for Latin to be able to benefit from being taught it.

I warmly welcome my right hon. Friend's statement. Inner-city kids have long deserved such initiatives. However, I have a few words of caution for my right hon. Friend. On disruptive pupils, the proposals remind me of the old sin bins syndrome, against which a number of us fought. I hope that we are not returning to that situation, in which many black kids were put into sin bins because they were classed as disruptive.

Will my right hon. Friend pay attention to supplementary schools, such as Saturday and evening schools, many of which are provided by the black community? Those schools are financed by parents and, sometimes, by local authorities. Will he consider whether he can assist those schools in any way?

I welcome my hon. Friend back to the House after his period of illness. It is good to hear him speaking out and contributing once again on this important subject. I can make the absolute commitment that we shall not return to the use of sin bins, where students did not even receive an educational timetable and had no opportunity to improve their education, regain confidence or develop the ability to be reassimilated.

We shall, first of all, prevent children from being excluded. There is a need to prevent black, and particularly Caribbean, boys from being excluded from our education system. Secondly, where there is a problem of disruption and disaffection, we shall enable pupils to be helped and supported on site, rather than in external units, which inevitably divide them from the school.

Thirdly, I celebrate supplementary schools. It is precisely that model that I have been describing this afternoon. We shall now be able to help parents who have previously raised the money themselves to become, over time, part of the system of giving the extra help that supplementary schools have sought to provide. I know that people, not only those from the ethnic community but those from the most disadvantaged parts of our country, will welcome this statement irrespective of whether it is condemned by extremely well-off people in leafy suburbs who seek a return to divisiveness.

I am interested to hear the Secretary of State's announcement, but I want to question him about the provision of a learning mentor for every young person who needs one. Where will those mentors come from? He said that he would recruit 800 mentors, who would then find volunteers.

I want to make a suggestion to the Secretary of State that we have been working on in Southampton. One of the less-favoured areas of the city, the so-called "Flowers" estate, is next to a university, where the students, like all students, are short of money and could earn extra by working part-time. Would there be merit in seeking part-time volunteers in universities and twinning them with schools? Young people who have not long left school and remember what it was like would be in a good position to help the disadvantaged children to whom the Secretary of State has referred and whom his scheme is designed to help. Will he consider that suggestion?

We rejoice in that. We are glad that the hon. Gentleman has had the decency or the courage to ensure that he is able to welcome and put forward positive ideas. We welcome his ideas entirely. We think that there is a positive role in developing such links. There is an argument taking place around me, with some occupants of the Opposition Front Bench saying that the shadow Secretary of State welcomes my statement. Lord help me if the hon. Gentleman had opposed it. However, I welcome the suggestion of the hon. Member for Romsey (Mr. Colvin), and we will build on suggestions of that sort. If postgraduate students are able to engage with inner-city schools, that will help not only the child or youngster direct, but will inspire them to believe that they, too, can go to university and succeed.

I thank my right hon. Friend for his statement. Will he congratulate and commend the very many teachers who achieve year-on-year improvement among pupils from deprived families in Birmingham and in every other big city in the country? Will he clarify whether the welcome extra assistance that he has announced this afternoon will depend not on geography, but on levels of deprivation, so that out-of-city schools in deprived areas will also benefit?

The assistance will be for schools in the areas that I have described, and how to accelerate and provide initial support will be a matter for local determination. It is not about geography, in the sense of proximity to a central shopping centre; instead, it is about levels of deprivation in areas, including out-of-city estates, which are often the most deprived and least gentrified of all.

Clearly, we shall want to celebrate the excellence of the heads and teachers, who often do a tremendous job against the odds. We shall want to reward that success, and we shall want to celebrate it by spreading it. Above all, we want to ensure that that success is rewarded through the proposals in the consultative Green Paper, which I hope teachers will read, rather than reading views about it from those who have been against it from the word go.

We spent 10 years working in Brixton and Peckham with some of the most educationally disadvantaged young people, who were suffering from the socialist ideology of the Inner London education authority and its lowest common denominator philosophy. There were then 10 years during which the Labour party bitterly resisted the introduction of a national curriculum and tests of attainment. It is strange now to hear the Secretary of State trying to square the circle to satisfy the socialist chattering classes.

Surely the dilemma that the right hon. Gentleman faces with his statement is that he is proposing an entirely arbitrary system of endless selection of which schools and which pupils will or will not participate in the scheme. Diversity was provided by assisted places, grammar schools and the changes that were set in place. Is the right hon. Gentleman surprised that so many head teachers despair at the level of announcements, the glitz, the glamour, the documentation and the bossiness of the approach? Is it not time now to let the schools get on and deliver the results themselves, rather than introduce a highly complicated scheme where children will be hurrying and scurrying from school to school and centre to centre, unable to settle down and achieve results?

Having condemned the lowest common denominator approach in the opening part of the right hon. Lady's statement, she went on to condemn measures that ensure that we do not have that approach, and instead celebrate diversity and accelerate the meeting of the child's individual needs. There is no suggestion of hurrying and scurrying between schools, because, unlike the system that offered real opportunity only if we took children out of their neighbourhood school and their area through selection or assisted places, the scheme that I have announced is about helping children who remain in their neighbourhood schools. They would do so under any system, because selection and assisted places took only a tiny fraction of children out of the state system, out of the normal system, and left the rest to manage for themselves. The proposal is for real diversity within the school that a child attends, where the necessary support will be provided. The scheme, if I may say so to the right hon. Lady, is free of dogma, which is why her hon. Friend the Member for Romsey (Mr. Colvin) had the decency to welcome it.

It ill behoves Opposition Members to be so critical of such an important announcement for the state education system, where the vast majority of our children receive their education, given that, during the entire discussion, the maximum number of hon. Members that the Opposition have been able to raise on the Back Benches is 12.

I welcome the fact that my borough, Knowsley, has been included in the project. I seek clarification of various aspects. Will my right hon. Friend advise me whether, in the areas that have been identified, attention will be given to the range of subjects that are currently available? For example, I can think of only one school in Knowsley where Latin—a subject that my right hon. Friend mentioned—may be available. I can think of none where Greek is available, and none where Russian is taught, except possibly at the same school that offers Latin. Will my right hon. Friend make sure that, within the zones, the full range of opportunities will be available?

In that connection, does my right hon. Friend envisage pupils crossing the borders within the zones—for example, from Knowsley to Liverpool? That may solve some of the problems of provision in Knowsley, but even in Liverpool, in schools that are still in the state system, some of the subjects that I would like to be available are not taught in any school.

Finally, will my right hon. Friend clarify how the mentoring system will work? As a former chairman of education, I have had some experience of trying to get schools to co-operate in sharing their resources, when not every school could offer the full curriculum. I was disappointed to see how schools were prepared to give up their pupils to another school for enrichment.

On the final point, the mentoring system will enable the red tape, obstruction and difficulty to be unwound more easily, as the individual will have an advocate working on his behalf, supporting him directly and unravelling the bureaucracy.

On the question of working across boundaries, that will be important not only in Merseyside, but in other conurbations, particularly London, where it will be necessary and beneficial for local authorities to share expertise and resources.

It is indeed a challenge to provide scarce specialisms such as Latin. I understand that my hon. Friend the Member for Bolsover (Mr. Skinner) has offered to assist with that, because, every time I mention Latin, he gives me the—

Amo, amas, amat, amamus, amatis, amant.

I am grateful. At this point, the late Derek Enright would have sung "Yellow Submarine" in Latin. I deeply regret that he is no longer with us to do so.

rose—

Order. Time is moving on, and there is the business of an Opposition day to safeguard. Questions and answers are far too long. I shall not be able to call many more hon. Members, as it has taken such a long time to get through the few questions that we have had.

The Secretary of State knows well that the family of schools in the borough of Trafford achieves the best results in Greater Manchester—indeed, the best results in the north-west of England. Perhaps he will reflect on the fact that that is not just because 35 per cent. or more of the children go to grammar schools and get a good academic education, but, perhaps more important, because the others who go to good high schools get a good technical or vocational education, as was recognised by the Secretary of State in response to a sedentary remark from the Government Benches. The right hon. Gentleman has made one of those schools a beacon school. Is he not concerned that the proposals that he outlined may give some academic benefit to a fraction of pupils, but will sacrifice the vast majority, for whom there will be no improvement in the technical or vocational education that they should have?

Exactly the reverse. I commend those schools for being excellent; precisely because they are so excellent, the bulk of parents in the hon. Gentleman's constituency, should they vote for a non-selective system, would want their children to continue to attend them.

Is my right hon. Friend aware that his statement will be widely welcomed in the inner cities? He will be aware that one of the distinguishing characteristics of many inner-city areas is a high number of black and ethnic minority children. He will know that, last month, I held a conference in Hackney on black children in schools, which attracted more than 500 people from all over the country. I do not want to prolong my question; will my right hon. Friend build on the positive work that is being done in the community, exemplified by the Saturday school movement, and listen to what black parents are saying? They, too, want excellence for their children.

The answer is yes.

Would it not have been so much better to have kept the assisted places scheme in place, because it would have had universal benefit throughout the country? As for the leafy suburbs, of which the right hon. Gentleman speaks so disparagingly, will he turn his attention to how local parents would be better able to secure a place in their local school for their children? That really concerns them.

Those children need a local place—an excellent local place. They do not need a system that allows a few to escape from a local place that they do not find acceptable.

The many, not the few.

As my hon. Friend once again says, so rightly, that is why we are in favour of the many, not the few.

I welcome my right hon. Friend's statement—which, on top of his wise decision to support the Bradford schools review with £170 million, is good news—but will he clarify whether the money for gifted pupils will be awarded per pupil, per school or per local education authority?

The resources will be allocated in relation to the needs of an area as a whole and will be discussed with those areas so that we can ensure that we can get the initial programme off the ground as quickly as possible.

Does the statement not show that the Government are suffering from a serious split personality? I welcome what the Secretary of State has said, especially as it endorsed the policies being pioneered in Conservative-controlled Wandsworth, but can he explain why the Government are still undermining the grammar school system if they are now committed to selection on the basis of ability?

I thought that I had just explained that we are helping children, whatever their ability, in the school that they attend. The hon. Gentleman described the excellence in Wandsworth, but it also seems to have passed me by that we have adopted such a system. There seems to be a degree of schizophrenia here; either we are adopting such a system, which he would welcome, or we are not adopting such a system, which he would oppose. I heard both in his question.

My right hon. Friend will know how welcome his statement will be in Sheffield and in Rotherham. May I pick out two matters? First, I particularly welcome the widening of choice on foreign languages. My right hon. Friend will remember when Ecclesfield school, for example, offered a number of languages, including excellent provision of Russian, which was whittled down to nothing during the 18 years of Tory rule. Secondly, I welcome provision for the awkward squad coming back into schools and getting some education. However, both those areas require good specialist teachers. Will he say a bit more about how many extra teachers he expects to be involved with that provision, which will be so welcome in the inner cities?

I am pleased that my hon. Friend recalls her time teaching at Ecclesfield school, where she did an excellent job with special needs pupils. Not only will we seek to recruit and to accelerate those who have a specialism that is not readily available, but, as I have described, we will use technology to link up with schools that do not have those specialisms available. The experiment carried out in the Strathclyde region before the change in structure in Scotland was very interesting, because it linked small island and highland schools into a provision that was available only in a handful of urban schools in Strathclyde. That allowed pupils to link into classes and to teachers with such expertise. Although we need to do a great deal more, we can link up not simply across our country and across Britain, but across Europe and the world.

I welcome what the Secretary of State has said about the pursuit of excellence for children with academic abilities in our inner cities. Some of those whom he despises—constituents of mine who live in "leafy suburbs"—go to school in Birmingham, alongside Birmingham children who are socially deprived and from ethnic minorities, because they attend the city's excellent grammar schools, which his Government want to abolish.

In the light of today's statement, and of what I believe to be his intention to raise standards for all, will the Secretary of State tell the people of Birmingham—the politically correct left-wing loonies, perhaps, who still want to use the mechanism introduced by his Government to abolish state grammar schools—to desist from doing so, in the interests of everyone, not just those in leafy suburbs?

In the interests of brevity, I shall not comment on that rant—except to say that, far from despising the hon. Lady's constituents, I want them to have the excellent education that some of them are seeking through the selective process which enables them to attend grammar schools in Birmingham, rather than the schools available to them in her constituency. This is the essence of our disagreement: at the heart of what we are doing is our wish for children to have confidence in local schools, rather than trying to escape from them.

I welcome the statement, as does everyone in Birmingham. I thought that I had heard the end of Conservative Members' referring to left-wing loonies and Birmingham in one breath—especially as I seem to remember a libel action some time ago which was most embarrassing for the then Secretary of State.

I was delighted to hear my right hon. Friend refer to mobility. When he mentioned it first, I thought that he meant pupil mobility, which is a great concern of mine, but I welcome what he said about the need to reduce the number of supply teachers, and to provide more stability among teaching staff. Will he elaborate on that, and explain how we can work together to provide such a stable environment in schools?

I take to heart the need to ensure that teachers are attracted to, and retained in, the schools that face the biggest challenge. Pupils at a primary school that was referred to in our document had 25 teachers in one year, which caused immeasurable disruption to their education. If, by means of retention bonuses, special development programmes and the attachment of mentors to teachers and pupils, we can avoid such disruption, we shall do a great service not just to pupils and parents, but to teachers, enabling them to fulfil their desire to take on the challenge to teach in the inner cities, knowing that they have the necessary backing.

Does the Secretary of State accept that two improvements are necessary if the parents of bright children who live in inner cities are to feel more confident, and if more of them are to send their children to non-fee-paying, non-selective inner-city schools? First, more transparent application arrangements are required, involving a fair appeals system in every school—including, independently, city technology colleges, which are not yet required to have such arrangements. Secondly, rather than issuing directives to local authorities for the prospective contracting-out of services—such a directive was issued to Hackney on Friday—the Secretary of State should ask local parents what sort of management of their schools they want, and, if they want a change of management, let them, rather than Ministers, lead the debate.

We are digressing slightly, but, in any event, I am not going to organise a referendum on school management in Hackney or anywhere else. I shall ensure that there are proper structures enabling us to achieve the management and leadership that we need. Of course—as the hon. Gentleman said at the beginning—we need to get the arrangements right for individual children, and I should be happy for the hon. Gentleman to tell us, on the basis of his constituency experience, what he would like to see that is not mentioned in the document.

A young man who attends Windsor high school in the inner city of Salford wants to be a civil engineer. For the past year, he has had a mentor who has helped to shape and focus his ambitions, and I believe that, as a result, he will succeed in having a career that previously he did not dream of having. The proposals will help thousands of children just like him to flourish. Does the Secretary of State agree that it is vital that those children have support not only in school, but at home in their communities? Will he confirm that the support for educational excellence will be linked to inner-city regeneration, to ensure that our success is long term and sustainable?

I can indeed. It will be rooted in the regeneration programme. Let me make it clear that, like everyone else, I accept that unemployment, poor housing, poor health and a poor environment have a dramatic impact on the life chances of children and on the schools and teachers who teach them. We need to compensate for and to overcome that disadvantage, not to excuse it. I take entirely the point that my hon. Friend makes. We will do that. We will provide those mentors. We will provide that support in Salford as part of ensuring that pupils such as the one whom she has mentioned have the aspiration and expectation that we take for granted.

Earlier, the Secretary of State described selection as an anachronism. Will he confirm that, under the Government's policy, not only will some pupils be selected for their specific talents, but each school will be required to select 5 or 10 per cent. of pupils by ability, and to provide those pupils with a different teaching and learning programme from other pupils in the school?

No, I will not confirm that. I will confirm that the existing programme, which all pupils will go through, will remain, that those pupils will take that programme, but that it will be accelerated and extended where appropriate. This morning, I was at St. Paul's Way community school in Tower Hamlets, one of the most deprived areas of the country. Fifteen-year-olds there are taking A-levels, developing alongside their normal programme the ability to stretch and to extend their talent. I want every child to be able to do so, not just those who can buy private education.

On a point of order, Madam Speaker. I seek your guidance. As you will recall, the House received a serious admission from the Chancellor of the Exchequer on 16 March by written answer that his Parliamentary Private Secretary had received, before its publication, a draft copy of the report by the Select Committee on Social Security on taxing child benefit. However, at the time, the Chancellor had not answered other questions about the involvement of his political adviser, or possibly his officials. Therefore, I asked that question again. However, on 19 March, the Chancellor's answer to that specific question was simply to refer me back to his answer of 16 March; in other words, he refused to answer the question.

My point of order is to refer the House to the clear guidelines that are set down in paragraph 1 of the ministerial code. The paragraph is taken from a resolution of the House, which says:

"It is of paramount importance that Ministers give accurate and truthful information to Parliament".

It goes on to say that Ministers may refuse to provide information

"only when disclosure would not be in the public interest".— [Official Report, 19 March 1997; Vol. 292, c. 1047.]

As the code is at one with the resolution that was passed by the House, is not the Chancellor abusing the House and the public whom Parliament serves by refusing to answer that question? Do you agree that the Chancellor should now come before the House, apologise for his failure to uphold that code—which the Prime Minister stressed in his opening remarks in the code—and answer, once and for all, the question whether his advisers or officials were involved in that leaked draft report?

Further to that point of order, Madam Speaker. Can you guide us on what redress is available to the House of Commons if we find, as we increasingly do—the example of my hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith) seems to exemplify it yet again—that Ministers refuse point blank to answer a question that has been accepted by the Table Office, and refuse on a second or subsequent occasion to give any further information? Is the House of Commons then simply left completely lost? Is there nothing that we can do? Are the Government now able, as they never were in the past, to stonewall and to refuse the House any information after a question has passed through the Table Office?

Further to that point of order, Madam Speaker. I am a member of the said Select Committee: the Select Committee on Social Security. The facts are clear. The Chancellor has admitted that his Parliamentary Private Secretary received a draft report. I have tabled a question to ask from whom he received the draft report. I await the answer to that question anxiously.

Surely the answer is simple. It is inconceivable that one of your Clerks, Madam Speaker, gave the PPS that Select Committee report. It is unlikely that a Conservative Member provided the report. However, someone must own up to providing it. If the Executive received a draft report from the Select Committee and no one owns up to providing it, it is difficult to see how the system will be able to continue operating. The system will simply collapse. We therefore do need your help and guidance on the matter.

On a different point of order, Madam Speaker.

Let me deal first with the first point of order.

I am grateful to the hon. Member for Chingford and Woodford Green (Mr. Duncan Smith) for giving me a little notice of what guidance he was seeking. As the House knows, Ministers take responsibility for the answers that they give, and I cannot comment on the specific answer to which the hon. Gentleman referred.

In general, the House is entitled to expect—as I do—that all Ministers will comply with the resolution on ministerial accountability. Enforcement of that resolution, however, is a matter for the House and not for the occupant of the Chair. I am sure that hon. Members, using our procedures, will find further ways of pursuing questions. Moreover, Ministers will have heard the points of order that have been raised and will take note of my response to them.

I call Mr. Bercow.

Thank you, Madam Speaker. May I seek your guidance on the implications for the House following a report—on page 2 of The Sunday Times yesterday, by Jonathan Carr-Brown—of a transport conference being organised by Professor David Begg, which is due to take place tomorrow and to be addressed by, among others, the Secretary of State for the Environment, Transport and the Regions? The report states—the Department has not contradicted it—that the Secretary of State will make what is described as a "keynote speech" on bus policy, and that he is billed as launching the Government's White Paper on buses.

As the conference is advertised on that basis, and as charges—of between £175 and £275—are levied for attendance, is it not a matter of the utmost seriousness? Given that you have made very clear your views on the importance of informing the House first—and as Ministers might be hard of hearing—would you care to reiterate your views on this important matter?

I pay little attention to such newspaper reports, and am not in the least bit interested in keynote speeches made outside the House by Ministers. It is not a matter for me. Ministers know my views on the matter, and certainly the Deputy Prime Minister has an excellent record in coming to the House first before making announcements outside it. He also knows full well my views on the matter. If there is any new policy or a policy change, he is a Minister who usually comes to the House first before announcing the policy outside it.

We now come to the first debate on the Opposition motions. I have selected the amendment in the name of the Prime Minister.

I beg to move,

That this House notes that the prime determinant of council tax levels is the amount of funding allocated by central government to local authorities; further notes that as a consequence of inadequate financial settlements for local government in recent years there has been a substantial real-terms year-on-year increase in council tax; and calls on the Government to improve the funding of local services and abolish budget capping within the lifetime of this Parliament.

Shortly before the 1997 general election, the House debated the then Conservative Government's last local government settlement. During the debate, the then shadow Secretary of State for the Environment, now the Secretary of State for Health, declared:

"The incoming Labour Government will be based on the supposition that democracy depends on the people who take the decisions carrying the can".

That is absolutely right. It is what this debate is all about—that those who take the decisions should carry the can for them. As our motion clearly states, the Government's responsibility is plain and clear when it comes to the increases that councils are now having to foist upon their citizens.

In the same debate, the right hon. Gentleman went on to say:

"We shall not roam around the country blaming local councillors for decisions that we have taken in the House of Commons."—[Official Report, 3 February 1997; Vol. 289, c. 701.]

That, too, is absolutely right.

Two years on, is Labour taking responsibility? Last November, the Deputy Prime Minister came to the Dispatch Box to announce Labour's second local government settlement. We were treated to much of the usual display of smoke and mirrors. We were told that council tax need rise by no more than 4.5 per cent., and Ministers spent the day going around television and radio studios underlining the positive message of only a 4.5 per cent. council tax increase. Moreover, we were told that the settlement was the most generous since council tax was introduced.

We know now how wrong those claims were. Council tax bills are rising by 6.8 per cent.—an average increase of £51 on band D in England alone. The Government have to take responsibility; they must stop blaming local authorities and councillors for the consequences of Government decisions taken in the House with the support of Back-Bench Labour Members.

Why is the average council tax per dwelling so much higher in Liberal Democrat areas than in Labour or Conservative areas?

If this is going to be one of those debates when we trade variations of statistics, we can cite with the band D average, which shows a 6 per cent. increase for Liberal Democrat authorities.

The issue is not what local authorities decide, because more than 75 per cent. of what councils spend comes from central Government. The decisions of central Government overwhelmingly dictate council tax levels. We can all come up with spurious statistics, or even factual ones—I am sure that those referred to by the hon. Member for Pendle (Mr. Prentice) were factual—but we have to recognise that all the statistics are shaped by the decisions of Ministers on the distribution of grants and non-domestic rates.

The hon. Gentleman is right to point the finger of responsibility at the Government Front Bench, but I hope that he agrees that it is important that he should approach the debate with clean hands. Will he tell the House the average saving achieved by Liberal Democrat-run authorities from competitive tendering and market testing?

I am grateful to the hon. Gentleman for that intervention and I shall give him a straight answer. I cannot give him the figure today, but I shall happily write to him with it in due course. I shall be interested to hear his speech later, when I am sure that he will try to give us every detail of the savings arising from compulsory competitive tendering by Conservative councils. The figure will be much smaller, because there are so few Conservative councils these days. Compulsory competitive tendering, which is referred to in the Government amendment, has produced inefficiencies because of the way in which it has been delivered. The crude and ineffective mechanism of CCT might have produced artificial savings, but they came at the expense of quality of service. The Conservatives never understood that when they were in government. That is why they lost so many seats in local government throughout the country.

The lion's share of what councils spend is provided by the Government in the form of grants and business rates. That means that small changes in the way in which the Government distribute the cash have large consequences for council tax bills. An essential qualification for being a Minister in the Department of the Environment, Transport and the Regions seems to be a willingness to live in a world of fantasy figures—a fantasy based on the pseudo-science of standard spending assessments. Ministers place great store on the standard spending assessment. Education Ministers seem to believe that it is a true measure of what councils should spend on education.

In reality, the formula is nothing more than a means for delivering and distributing a cash-limited budget. Minor changes in the algebraic formula that underpins the standard spending assessment can have profound effects on the level of council tax, as we are seeing as bills start to be printed and delivered to council tax payers. As the Chartered Institute of Public Finance and Accountancy recently said:

"Because the financing of local authority spending depends so heavily on central government support, raising relatively small amounts of additional local revenue results in exaggerated increases in council tax levels."

Standard spending assessments are only part of the story. The sleight of hand is more subtle than that. The gap between what local authorities are spending and what the Government are funding is growing. It stands at £2.3 billion and is set to widen further. As the Government withdraw support from local spending, the council tax payer has to pay more. During the debate before the election, Labour exposed that as a scandal, but the Labour Government have continued with the same policy. As a consequence, for every pound that the Government fail to fund, council tax goes up by an average of £4.

In the Government's fantasy world, we are told by Ministers that a 4.5 per cent. increase is all that is needed, and that no cuts will be necessary in front-line services. I have been watching closely and listening to Ministers and their advisers, and that is not what is happening on the ground. In the real world of inflation, an ageing population and an increasing number of school children, councils have already endured two years of Labour austerity; two years of Labour sticking to Tory spending plans; two years of cuts and council tax rises.

Labour would like us to think that year zero started with the comprehensive spending review. We are to forget the first two years of a Labour Government, and focus on the next three. "Cash for change" is the cry, but that ignores the cumulative effects of years of inadequate settlements under the previous Government, and now under this Government. In the real world, Labour's spending commitments are being oversold and underfunded. Over the lifetime of this Parliament—not just the last three years—compared with the last full Parliament, current real annual spending growth has halved: 1.4 per cent. versus 2.7 per cent.

On education spending, there is the much-vaunted £19 billion extra. The number of times that this figure, and sub-sets of it, has been launched and relaunched would place the Government well at the top of the Audit Commission's league table on recycling. Apart from being a three-year cumulative figure—rolling up total spending compared with current years—it is conveniently forgotten that the figure includes three years' worth of inflation and all aspects of education funding, including colleges, universities, Ofsted inspectors and special grants.

Nearly half the Government's promised increase is not an increase in funding, but comes in the form of standard spending assessment increases. That is not cash from the Government, but cash from council tax payers. Councils taking up the Government's so-called generous SSA increase will have to cut other budgets or increase council tax—or, in most cases, both. Last year, the Government left councils to find £562 million for local education in that way. The result was that class sizes went up, not down—which was an early Government pledge.

The total increase in central Government funds to local authorities is set to rise by an average of £1.5 billion over each of the next three years, and education's share of that is likely to be no more than £600 million a year. Those figures take no account of the teachers' pay award this year and the Government's failure—again—fully to fund the award leaves councils having to find an extra £68 million in the coming year.

It is not just in education that cuts in other budgets or increases in council tax will be needed to bridge the gap. A closer inspection of figures provided by the Library reveals that the social services standard spending assessment for England will rise by just 1.3 per cent. after changes in the grant and special grant regime that provided for community care in the past have been taken into account.

Even on the Government's own fantasy figures, that will leave a £100 million gap, simply to meet inflation, for social services to pick up. A lower inflation increase for social services will make cuts in current services inevitable. Undermining current social services by underfunding makes no sense at a time when the Government, rightly, are setting targets and directing a host of specific grants at social services to secure change and improvement. Ultimately, that is self-defeating.

To make matters worse this year, local authorities have been left waiting for the Department of Health to publish the conditions for all the new grants, turning the planning and budgeting exercise into a nightmare. Only last Tuesday, the conditions for the three biggest grants were finally published—well after most local authorities will have set their budgets and made their decisions about council tax.

It is not just the levels of council tax funding that make a difference, or the way in which money is distributed; it is also the capping system itself. The Government amendment applauds the abolition of crude and universal capping—and we, too, would applaud that. However, capping is still with us this year. The only difference is that the Deputy Prime Minister is keeping the figures to himself; he is not sharing them with anyone else. As a result, councils are forced to play Russian roulette with school budgets, meals-on-wheels charges and other services.

Just in case councils do not get the capping message from the Government, there is new Labour's own brand of crude and universal capping. Council tax benefit subsidy limitation gives the Government the power to claw back council tax benefit from councils increasing their council tax by more than 4.5 per cent. The result is a further increase in council tax or a budget cut to pay for the loss of council tax benefit subsidy.

The Labour manifesto promised an end to crude and universal capping, but with reserve powers to control council tax rises. The clawing back of council tax benefit is not a reserve power: it is crude and it is universal. A council with an 8 per cent. council tax increase will receive no further funding for council tax benefit for the poorest in its community, so the nearly poor will have to pay for the benefits of the really poor in their communities. So much for ending crude and universal capping.

For Liberal Democrats, local accountability means greater financial independence. As a first step, we would return to local councillors the power to determine local business rates, which would increase the amount raised locally for council expenditure from a quarter to nearly half. That would begin to rebuild financial independence, creating greater transparency and accountability to local people.

The figures are clear—the average council tax increase is 6.8 per cent., which will result in an average band D increase of £51 a year. That is more than the Government claimed, and more than people were led to believe.

My hon. Friend has been very accurate in his general observations, but I want him to answer a particular question which may be of interest to the Minister, who lives in the borough that I represent. When my constituents complain that the Labour council is closing day centres for the elderly and for adults with learning difficulties, and wants to sell off housing estates because it does not have enough money to repair other estates, is that more the local Labour council's fault, or more the Labour Government's fault? Which manifestation of Labour should people blame?

I am grateful to my hon. Friend. Every single council tax payer faces that dilemma because accountability is even more blurred now than under the previous Government. Labour councils implement Labour Government council tax increases and cut services to try to keep council tax down a bit. Of course, individual councils have to set priorities, but in my hon. Friend's area a Labour council is making decisions that cut local services.

I have a final quotation:

"It is no good the Government complaining that councils blame central Government. Central Government have so constructed the system of local government finance that they tell it how much it can have, what it can spend it on and how to spend it. The country has rumbled that and knows that central Government are taking decisions and deciding how those decisions will impact in every area."—[Official Report, 3 February 1997; Vol. 289, c. 760.]

How very true were those words, spoken by the current Minister for Local Government and Housing; and they are truer today than when she first spoke them. The Conservatives may have engineered the local government finance system, but Labour has fine-tuned it to give Ministers even more power to direct what councils can or cannot do. The Government, more than local councils, have taken the decisions that have determined council tax increases, because so much of the money comes from the centre.

The people have indeed rumbled what has happened, and have seen that, as a consequence of decisions taken by the Government, there will be a massive back-door increase in taxation. Labour should carry the can for that.

I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof:

"notes that the 1999–2000 local government settlement was the most generous since the introduction of the council tax; further notes the Government's commitment of an extra £40 billion for schools and hospitals; and welcomes the introduction of Best Value, the abolition of crude and universal capping, the reform of political management structures and the new ethical framework, set out in the local government White Paper."

This debate is interesting. Hon. Members may already know that it is little more than a fig leaf to cover the embarrassment caused by the Liberal Democrats' confused and contradictory local government policies. The hon. Member for Sutton and Cheam (Mr. Burstow) is a prisoner of his own party activists. He knows that the interests of Liberal councillors are not the same as the interests of local people.

He is a party activist.

Perhaps the hon. Lady has given us the truth.

The interests of Liberal Democrat Members are not the same as the interests of the general public. Liberal councillors want higher taxes from local people, while local people want best value for their money. The hon. Member for Sutton and Cheam knows that he cannot take a responsible and grown-up attitude to local government policy and please both—so he has chosen to put party before people. Because the hon. Gentleman cannot reconcile the interests of his councillors with the interests of the electorate, he has this afternoon tried to shift the blame for council tax rises, many of which have been the direct decision of his party, away from councils and on to the Government.

Liberal policy is muddled: the Liberal Democrats say that they want the Government to grant more money to local councils, but councils to raise more of their money for themselves. The Liberal Democrats say they want lower council tax rises, but want to abandon all controls on local government spending. They say they support public services, but want to do nothing to ensure best value for local people. Much of local government has moved on from the old politics of spend and blame; it seems that the Liberals have not. They have become apologists for old-style municipal tax and spend, high taxation and low efficiency.

If the Minister thinks that Liberal Democrat councillors and activists are so out of touch with the wishes of local people, will she explain why the Labour party—especially in the north-west of England—has lost council seat after council seat to the Liberal Democrats over the past year or two?

If the hon. Lady revealed the turnout at those by-elections, she might not be so gung-ho. The Tories craved too much control over councils, but the Liberals propose out-of-control councils—with taxes as high as they like, spending as much as they want, service standards as low as they get—with the Government taking no responsibility for improving public services or protecting local taxpayers. The Government reject both those approaches.

The Minister asserts that our policy is to release local government from central Government control, and she is right. However, much of what Liberal Democrats have said for many years is also the policy of the Local Government Association, including returning business rate control to local councils and a local income tax. The LGA has long campaigned for those policies.

The hon. Gentleman will wish to retract that statement, because I have never known the LGA to propose a local income tax. I hope that the hon. Gentleman's enthusiasm will take him down the right road. The LGA has argued for the return of business rates to local control, but it also accepts that redistribution would be needed if that were to happen, from those authorities—

indicated assent.

The hon. Gentleman did not make that point clear. Such redistribution moves away from the relationship between central and local funding. We believe that central Government should work alongside local councils to get the best for the local taxpayer and encourage local democracy. Central government should not seek to control too much or to abandon responsibility for what happens.

It is in the national interest that local communities should take more decisions for themselves; that local councils should be more responsible to local people than to central Government; and that responsible councils should set their own levels of taxation. It is also in the national interest that central Government should ensure that national standards of public service are set and met, and major failures in service delivery are halted and reversed. It is the responsibility of central Government to make resources available to local councils to provide and enable the provision of modern public services, at a price people are prepared to pay, and it is right for the Government to ensure that those resources are spent wisely and well.

The hon. Member for Sutton and Cheam tried to pretend in his peroration that the Government had not been generous to local government. In fact, in the five years of the previous Parliament, standard spending assessments fell by 3 per cent. in real terms, while the Labour Government have already increased SSAs by 2.6 per cent. During the first four years of the Government, SSAs will increase by 6.9 per cent.

When the Conservatives exercised central control through crude and universal council tax capping and pre-announced spending limits for every council in the country, it could fairly be claimed that they took responsibility for every council tax rise. The capping threshold ceased to be a maximum spending limit and increasingly became the norm. Conservative Governments enjoyed the right to limit every budget increase, and they must therefore take responsibility for every council tax rise. As we said we would in our manifesto, we have ended crude and universal council tax capping. This year, there have been no pre-announced capping limits.

The hon. Lady said during her flight of fantasy that it was the responsibility of central Government to provide money for local authorities to provide local services. [Interruption.] She now says that she did not say that, but that was certainly the impression that she gave in her speech. How, then, would she respond to the hon. Member for Brent, East (Mr. Livingstone), who said that, as a result of the Government's settlement, £2.4 million would have to be cut from education in Brent? In addition, the hon. Gentleman said that provision of care for the elderly would be cut, that libraries would close and that children and the disabled in care would suffer. What would the hon. Lady say to her hon. Friend?

It is not my job to account for the meanderings of my hon. Friend the Member for Brent, East. I am not responding to his electioneering; I am here to deal with the electioneering of the Liberal Democrats, and with the feeble attempts of the Tories.

Councils have set their tax and spending levels for themselves this year. They are responsible to their electorates for them, and they must now account for their decisions. Such decisions include that in Torbay—I am pleased to see the hon. Member for Torbay (Mr. Sanders) in the Chamber—where responsibility for the council tax increase of 17 per cent. lies with the Liberal Democrat council. Those decisions include that taken in Herefordshire, where responsibility for the council tax increase of 10.8 per cent. lies with the Liberal Democrat council. The biggest council tax rises among unitary councils are by Liberal Democrat councils. The Liberal Democrats can duck and dive, but they cannot escape their own responsibilities for council tax rises. It is little wonder that the average council tax bill per dwelling in Liberal Democrat areas is higher than in Labour areas.

Which Government were responsible for reducing the formula for bed nights, which has affected tourist areas; which Government reduced weighting for elderly people; and which Government have caused problems for areas with rising numbers of school pupils because of the time lag in the head count in standard spending assessments? Can the Minister name a council affected by all three of those factors? I can give her an answer: Torbay, where those characteristics account for a large proportion of the tax rise.

I wish that that were true. However, the truth is that Torbay is raising the council tax, not because it has taken SSA changes into account, but because it is raising its budget by 6.7 per cent., which is somewhat above inflation. That is why there is a council tax rise of 17 per cent. The Liberal Democrats are responsible for the rise in that budget and they are responsible for the consequent council tax rise.

The Conservatives are no better. Conservative councils have higher than average increases in council tax at 7.6 per cent. In shire districts, Conservative councils have higher average rises than Labour councils.

rose—

The hon. Gentleman will have a chance to put his point in his speech.

In the 1980s, the Conservatives were proud of Wandsworth—their flagship borough. Last year, ahead of the local government elections in London, which may have been incidental, Wandsworth cut its council tax substantially. This year, when there are no elections, Wandsworth has the highest increase of any council in London, with a massive tax hike of 21.5 per cent. Compare that record with the rest of inner London

All inner-London authorities were treated similarly in this year's settlement. There are only three Conservative councils in inner London. The top three increases in council tax in inner London are in those same three Conservative councils. In Conservative Kensington and Chelsea, council tax is up 7.5 per cent.; in Conservative Westminster, it is up 8.7 per cent.; and in Conservative Wandsworth, it is up 21.5 per cent.

By contrast, other councils—Islington, Greenwich, Hackney and Lambeth—are cutting council tax this year. In the London borough of Redbridge, the Conservatives and the Liberal Democrats combined to vote through a total council tax rise of 11.3 per cent. in the face of opposition from the minority, but ruling, Labour group. It is little wonder that, across London, councils run by Conservatives and Liberal Democrats have higher average council tax rises than Labour councils.

The Minister attacked Torbay council for a 16.4 per cent. rise, which she blamed on the Liberal Democrats. Will she explain why the Labour group on Torbay council wanted a 20 per cent. tax rise?

I am not responsible for Labour group decisions and I do not support all of them, as I will make clear in my speech.

I do not make these points for partisan reasons. While it is the case that Labour councils have lower than average increases in council tax, I readily acknowledge that, in some Labour councils, council tax rises are higher than I would have argued for had I been a councillor. Those rises and the increases by Conservative councils—which are higher than average—are the responsibility not of the Government but of local decisions taken by local councilors.

It is the Government's responsibility to ensure that those decisions do not bear too harshly on the public purse, either locally or centrally. To protect the local taxpayer, we will shortly announce whether and how we propose to use existing capping powers for 1999–2000. To protect the national taxpayer, we have made local councils responsible for the extra costs of council tax benefit caused by large council tax increases.

The national interest demands that, where councils are proving irresponsible, the Government should have the power to intervene. The Local Government Bill, which is before Parliament, creates a reserve power for the Secretary of State, so that excessive council tax decisions can be judged over time, measured against expressions of support by local people and, if necessary, restrained. The Liberals oppose any restraining powers on local government. So, while they are prepared unfairly to blame the Government for higher council tax bills, the Liberals would stand back and let those tax bills rocket out of control.

Given what the Minister has said, will she explain, for the benefit of our constituents, the answer to the question that I put to my hon. Friend the Member for Sutton and Cheam (Mr. Burstow). If our local council, which is Labour run—for the first time in its history, Labour now has control only through the vote of the mayor—cannot raise the money that it wants because it is capped and the Government are setting a limit, and if the Government do not give it the money that it is asking for, whom should the council blame? It has been told that its day centres are to close—some have closed and the day centres for adults with learning difficulties are to close in the next few days. It has also been told that some of the council estates will have to be sold because there is not the money to repair them. Whom should the council blame?

The hon. Gentleman's problem is that he does not understand local government finance; it has nothing to do with the housing account. The Government have put substantial new money into housing and that is a separate matter from this debate. As I understand it, that is not the argument that Southwark council is putting about its estates.

In respect of the other issues raised by the hon. Gentleman, he said that the Government were capping councils. The Government are not capping councils. Councils have the opportunity to set their council tax at a level that they believe will deliver the quality of services for which people are prepared to pay. It is important that councils take responsibility for those decisions, and that they discuss them and argue them through with local people. Under current legislation, they are not supposed to do that; that is why we are changing the legislation in the way that will be announced tomorrow.

The Tories, who for years were hooked on centralisation, are today reformed "capoholics", slowly emerging from their blue haze, trying desperately to come to terms with the reality of their past, not quite certain whether to control their addiction by an occasional fix or to give up the cap for good. In contrast to the Conservatives and the Liberal Democrats, the Government recognise our responsibility to ensure that local services are well resourced and well delivered.

Best value will sweep away the outdated over-regulation of compulsory competitive tendering and usher in a new era of rising standards of public service, greater involvement by local people in setting and monitoring standards and an emphasis on year-on-year improvement, innovation and public-private partnership. Best value provides the best means for keeping council tax rises down over the medium term. It is a fact that this year's local government settlement has been the most generous since the introduction of the council tax, with substantial extra money for education and social services.

As we have said, if council tax had increased in line with the increase in SSAs, bills need not have risen by more than 4.5 per cent. However, councils have decided to increase their spending by more than that, so council tax bills will rise on average by 6.8 per cent.—less than £1 a week, and a lot less than the double digit increases predicted by the Conservatives and the Liberal Democrats. [Interruption.] We made no predictions, but said that, if council taxes rose in line with the increase in SSAs, the rise would be 4.5 per cent. Those council tax rises have occurred despite the extra resources we have committed this year: an extra £2 billion of Government grant, which is an increase of 5.5 per cent., well above the rate of inflation. No local authority has received less grant this year than last year, and all education and social services authorities have received more grant this year than last.

Of course, the Liberal Democrats have today repeated their usual mantra: tax more, spend more. However, it is based on a false boast. The Liberals say that the Government have not put enough money into health and social services. At the election, they promised an extra £3.5 billion; we have put in an extra £21 billion. They say that we have not put enough money into education. They promised £9.5 billion; we are putting in £19 billion. This debate has been called by Liberal Democrat Front Benchers for no other reason than to curry favour with the Association of Liberal Democrat Councillors—one might almost imagine that a leadership contest was in the offing.

The debate has not been called to hold the Government to account, because we know that this year's settlement is the most generous for seven years and more generous than anything offered by the Liberals or the Conservatives at the election. The Liberals keep telling me, and Paddy Ashdown reaffirmed it—

Order. The Minister must refer to parliamentary colleagues in the correct form.

I am sorry, Mr. Deputy Speaker. The right hon. Member for Yeovil (Mr. Ashdown), who is still a Member of Parliament, reaffirmed last September that the Liberals would have stuck with the financial memorandum that accompanied their election manifesto throughout this Parliament. The figures I am using are drawn from that document and, if hon. Members do not like it, I am sorry for them.

Can the Minister be objective and non-partisan, just for a moment? From her remarks, it appears that she regards as irresponsible any local authority, whatever the colour of its controlling group, that has exceeded the 4.5 per cent. increase. Is that really what she is saying to the Local Government Association and to a large number of Labour-controlled local authorities?

I have certainly not said that. That is why I have emphasised that we never set 4.5 per cent. as a figure above which councils should not go. We said that, if they went above that figure, they would have to share with Government the burden in terms of council tax benefit—

The Government penalise them.

The hon. Gentleman does not appear to understand that it is the taxpayer who funds council tax benefit, so the penalty is paid by the taxpayer. The Government are concerned about that, even if the hon. Gentleman is not.

Today's debate has not been called to highlight how responsible Liberal councils are. The hon. Member for Sutton and Cheam appeared almost embarrassed to mention Liberal councils.

She wrote that before the hon. Gentleman had even spoken.

It is not written down here, so there you go.

We know that the average council tax per dwelling in Liberal areas is higher than in Labour areas, just as the average increase in Labour councils is lower than in Conservative councils. The debate has not been called to draw attention to the shires, because average council tax per dwelling in shire areas is lower in Labour areas than in either Liberal or Conservative areas. The debate has not been called to demonstrate how responsible Liberal Front Benchers are, because we know that they would let council tax rise faster and further without trying to protect the taxpayer, while their hare-brained local income tax scheme would cost millions to introduce and lead to a massive increased burden on business in implementing it.

Local councils such as Wandsworth, Torbay and Herefordshire are responsible for pushing council taxes up, just as local councils such as Bristol, Lambeth and Greenwich are responsible for keeping average rises down.

Liverpool.

Liverpool, I grant the hon. Lady.

The Government are responsible for putting in place the necessary resources for local services, and we have done just that; the Liberals would have done even less. The Government are responsible for protecting the taxpayer, and we shall do so through our new reserve powers; the Liberals would do nothing. The Government are responsible for driving the modernisation of local government, just as we are doing through the introduction of elected mayors and a new ethical framework—the Liberals and the Conservatives simply do not know what to do.

It would do the House some good and do local government a great deal of good if we moved away from the yah-boo politics of spend and blame. It is time for a grown-up relationship, where councils take responsibility for their decisions and central Government intervene only in the national interest. Today's debate has been called by the Opposition, but they would do better to join the Government in taking a mature approach to the politics of local government. That is the Government's approach, but it is clearly not shared by the Opposition. I hope that, over the next few years, we can foster such an approach and demonstrate that there can be a fruitful relationship between the centre and the localities, in which both accept their responsibilities and work to ensure that local people get the best for their money.

I congratulate the Minister on her Alice-in-Wonderland speech. The only thing that I can say in her defence is that at least she could not keep a straight face for most of it.

I listened to Labour spokesmen making speeches from the Opposition Dispatch Box during the previous Government. They would have been horrified to think that, only two years after its return to Government, Labour's approach to local government spending would be turned on its head and changed so dramatically. I thought for a moment that it was a Conservative rather than a Labour Minister speaking—let alone an old Labour Minister from an old Labour Department.

The hon. Gentleman makes a perfectly valid point: it sounded more like a right-wing Conservative speech than a new Labour speech. Will the hon. Gentleman explain why no more than three Tories have been present for the debate so far? At one stage, only one Conservative Member was present. If they are so concerned about local government elections and council tax rises, where are the massed ranks of the Tories?

There is a simple answer to that question. I will go down the same road as the Minister and say that I suspect that the Liberal Democrats called today's debate not simply to discuss local government finance. I think that several Liberal Members have other agendas. It is sad to see that three prospective leadership candidates have now left the Chamber. No doubt, when more electors are present, they will return to their rightful places—as they now do every morning in the Tea Room at breakfast.

The first sentence of the Liberal Democrats motion reads:

"That this House notes that the prime determinant of council tax levels is the amount of funding allocated by central government to local authorities".

That is such a truism that I suspect that no hon. Member disagrees with it. In fact, it is almost as straightforward and simplistic as the statement that the battle of Hastings was in 1066—as every schoolboy knows.

When announcing the local government finance settlement last December, the Deputy Prime Minister declared, in his normal rumbustious way, that he expected council tax to increase by an average of 4.5 per cent this year. In a flight of hyperbole, he described it as

"the best deal for years for local people."—[Official Report, 2 December 1998; Vol. 321, c. 886.]

In the cold light of day, with council tax levels set for next year, the Deputy Prime Minister's view is not shared by most people around the country who are receiving their council tax benefits on their doormats.

Council tax bills.

Many people will receive benefits as well—I shall come to that later.

If the Deputy Prime Minister's comments had been included in a prospectus designed to sell a commercial product or service, I suspect that the Serious Fraud Office would want to interview him. The situation that he described is far removed from reality. As my hon. Friend the Member for Croydon, South (Mr. Ottaway) rightly said, the Deputy Prime Minister is a bit like a used car salesman. As we know from the figures released by the Government this morning, the average council tax increase in England is 6.8 per cent.—which is significantly more than his overly optimistic forecast. On band D precepts, Buckinghamshire faces an increase of 9.8 per cent.; Oxfordshire, 11.8 per cent.; Worcestershire, Nottinghamshire and Cambridgeshire, 9.9 per cent.; Hertfordshire and Norfolk, 9.8 per cent.; Shropshire, 9.7 per cent.; North Yorkshire, 9.6 per cent.; and Northumberland, 9.5 per cent. Even my county of Essex faces an increase of just under 7 per cent. Those figures do not include council tax increases for borough and district councils, which will have to be added to them, or certainly amalgamated into them.

Unitary authorities, especially in London, face horrific rises. Brent will experience an increase of 15.2 per cent.; Kingston, 12.7 per cent.; Redbridge, 10.9 per cent.; and Bromley, 9.9 per cent. Wandsworth, which the Minister mentioned, faces a increase, when the figure is rounded up, of 16 per cent. Outside London, to mention only a few, Torbay faces a rise of 16.5 per cent.; Rutland, 9.4 per cent.; Milton Keynes, 10.7 per cent.; and Telford and Wrekin, 9.5 per cent. So much for the Deputy Prime Minister's statement last December and his forecasting skills. It is no wonder that no one outside Millbank and Blair's on-message babes thinks that this is the best deal for local people for years.

Will the settlement, which the Government claim is so wonderful, enhance local services? Sadly, the evidence from budget setting throughout the country is that it will not. All over the country, there are cuts in crucial services, such as the police, due to budgetary pressures. In Essex, the mounted police section is to close down. [Interruption.] The Minister may laugh, but that is not funny for the people of Essex, who want a decent police force to combat crime.

The hon. Gentleman should know that Durham had to close its mounted police section some time ago, but such policing is necessary only in certain areas and at certain times, and that is frequently an operational, rather than a budgetary, decision.

I suspect that the right hon. Lady is, to coin a phrase, speaking on the hoof. The police authority in Essex has made it clear that, due to the lack of £7 million for funding the police this year, it is having to close down the mounted police for budgetary, not operational, reasons. The same is true of cuts in the motor cycle section of the Essex police and the closure of several rural police stations.

Does the hon. Gentleman think that his speech has any credibility, when the previous Government slashed public services for 18 years and, at the same time, jacked up the council tax and the poll tax to unheard-of levels? St. Helens council faces a 1.9 per cent. increase in council tax this year, which is in stark contrast to the cuts that it experienced under the previous Administration.

The answer to the first part of the hon. Gentleman's intervention is yes, but I am sure that his Whip has noted his remark and that, when the reshuffle occurs, his bid will be fully considered. In answer to his second remark, I shall deal later with areas such as St. Helens and the fiddling that has occurred this year in the setting of the amount of money that local authorities have received. If he would care to wait a little, I will explain why certain parts of the north have done considerably better than certain parts of the south, due to the Government's allocation of funding.

As I was saying, the effect of the settlement in Essex has been particularly difficult for the police and has resulted in 36 fewer bobbies on the beat compared with two years ago. The pledge "tough on crime and tough on the causes of crime" seems to be rather hollow in my county because, despite the tremendous work that the police are doing, they have found themselves financially squeezed, with their resources and equipment reduced year on year and fewer bobbies on the beat.

The settlement has had a similar effect in Barnsley. In an earlier debate, the hon. Member for Barnsley, Central (Mr. Illsley) told the House about the £2 million-worth of cuts in services there. There have been redundancies among teachers in Somerset, cuts in social services in Oxfordshire and education cuts in Brent. If the Deputy Prime Minister wants to join the real world to discover what is really going on as a result of his settlement which he thinks is so wonderful, I can recommend no better person for him to talk to than his hon. Friend the Member for Brent, East (Mr. Livingstone), who wrote in the Evening Standard on 29 January:

"How has it all gone so sour so quickly?"

I asked the Minister during her remarks what her answer to that question would have been if she had had the pleasure of meeting her hon. Friend. I am not sure whether it was out of nervousness because she did not know the answer or the result of in-fighting within the Labour party, but she dismissed her hon. Friend in fairly rude terms. I hope for her sake that the hon. Member for Brent, East does not read Hansard every day.

Does the hon. Gentleman accept that Brent still has the 18th highest standard spending assessment in the country?