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Written Statements

Volume 464: debated on Wednesday 10 October 2007

Written Ministerial Statements

Wednesday 10 October 2007

Business, Enterprise and Regulatory Reform

Low Pay Commission

I am pleased to announce that the Government have written to the Low Pay Commission setting out our non-economic evidence on the national minimum wage. The evidence addresses enforcement; publicity and awareness; the extension of statutory annual leave; social care; and workers, including vulnerable workers, migrant workers, volunteers and apprentices.

The Government will be submitting their economic evidence to the Commission later this year.

A copy of the non-economic evidence will be placed in the Libraries of both Houses and will be available from the BERR website at

Children, Schools and Families

Capital Investment in Schools 2008-11

Further to my statement on 8 October, I am announcing details of how £21.9 billion capital will be invested in schools between 2008 and 2011. As I said in my statement, good facilities where young people can learn and grow are a vital foundation for a good education, and that we are continuing the successful balance of programmes, established in 2004. These are: devolved programmes for every school and local authority; our long-term strategic programmes for primary and secondary education; and targeted programmes for key national investment priorities. These programmes, which I am announcing in detail, will drive our modernisation programme still further and faster.

Devolved Programmes

First, every school, local authority and diocese in the country will continue to receive resources. I am publishing each local authority’s devolved allocations for the three financial years to 2010-11. I am also publishing the 2008-09 allocations for schools of devolved formula capital, and indicative allocations for 2009-10 and 2010-11. Local people can decide how to invest these devolved resources in national and local priorities, and in support of their local children and young people plans, asset management plans and schools’ own premises development plans. School and pupil security is one of the important areas that should be addressed.

Well-established programmes continue, including modernisation, new pupil places and school access. Voluntary aided schools continue to receive a fair share of these programmes. Capital investment for extended services in primary schools, which was previously paid through the General Sure Start grant, is being allocated through this route for the first time in order to promote more complementary investment.

Most capital programmes can be used to invest in technology equipment. As I announced on 8 October, given its importance, there will be £837 million over three years specifically for ICT.

Strategic Programmes

Secondly, we are driving our long-term, strategic programmes to modernise primary, secondary and special schools.

I am publishing the allocations for the new primary capital programme, including pilot projects in 23 local authorities in 2008-09 and extra resources for every local authority from 2009. In the Budget 2005, this Government pledged an initial £1,150 million extra resources for this programme. Yesterday, the Chancellor of the Exchequer and the Secretary of State for Children, Schools and Families announced that we will increase investment by £750 million across two years (£200 million of new investment announced yesterday in the comprehensive spending review, together with £550 million of headroom available within the Department’s existing capital settlement), giving a total of £1,900 million in 2008-11.

This addition will allow at least one extra primary school to be modernised in every local authority. It reflects the importance that we place on the crucial primary phase of pupils’ education. We will shortly be asking local authorities to prepare strategies that will set out their long-term investment plans. As part of these strategies, local authorities will forecast how many primary and special schools will benefit in the coming three years; my initial estimate is that it should be at least 675 schools over the next three years. The addition of £750 million means that we should achieve the programme’s aims one year sooner, in 14 years instead of 15 years, subject to future public spending decisions.

We have already announced the projects that make up waves 1-6 of Building Schools for the Future. Planning is in hand for around 1,000 secondary schools, special schools and academies, with over 400 expected to be built by 2011. I am announcing the national budgets for Building Schools for the Future (BSF), including academies. Budgets for individual projects will be confirmed as waves 4-6 are finalised.

We welcome the Education and Skills Committee’s thoughtful report on the delivery of BSF, which we have responded to formally. Despite the acknowledged delays in the early part of the programme, our delivery agency Partnerships for Schools is pressing ahead to ensure that we deliver 21st century facilities for all secondary pupils. Seventy-two local authorities are now in the programme. I am delighted that the first new school, Bristol Brunei Academy, opened last month. According to local authorities’ plans, which may change, around a dozen schools will be open by the end of 2007-08, 50 more in 2008-09, 115 in 2009-10, 165 in 2010-11 and increasing to around 200 each year thereafter. This increasing rate is being driven by the professional expertise of Partnerships for Schools in supporting authorities as they develop their projects and engaging the private sector. Partnerships for Schools is working with my Department to learn lessons from the early projects to improve and streamline processes, and to ensure that educational standards as well as good design and efficient procurement are at the heart of the programme. I am grateful to Tim Byles and his staff for what they bring to this programme.

A further 39 local authorities, already announced, have one-school pathfinder projects in planning, and I am setting out the budget for these and other prior commitments. So far, 83 academies are also open (36 with new buildings), and around 50 more are projected to open by September 2008—on track towards the target of 200 open or in the pipeline by 2010 and 400 beyond that. So, we are fulfilling the commitment that every local authority not starting in Building Schools for the Future until wave 10 or after would benefit from a new school or academy.

We are reviewing the roll-out of waves 7-15 of Building Schools for the Future and will consult on this later in the year. Following the consultation, local authorities will be able to resubmit their expressions of interest, and we will publish the revised national programme for waves 7-15 later in 2008. This will give schools, planning authorities and the private sector good time to get themselves ready to deliver waves 7 and 8.

Targeted Programmes

Thirdly, I am also focusing investment through the targeted capital fund to schools that need specific help to meet national priorities.

Many schools have been badly damaged by the summer’s severe floods, and the Department has worked closely with the local authorities affected. I have re-assured these authorities that we will help them plan how best to meet the additional capital needs that the floods have caused. I want again to say how grateful we are for the efforts made by authorities, headteachers and staff to have places for all children at the beginning of term.

Seventy-six local authorities yet to be involved in Building Schools for the Future will share £608 million over two years—£8 million each. This investment is for them to respond to two national priorities: putting in place diploma provision for 14 to-19-year-olds, and improving poor condition buildings for children with special educational needs and disabilities. The latter priority addresses concerns in the responses to our consultation this summer. The intention is that this investment should be spent on a small number of major projects, rather than spread thinly. Separate arrangements will be made with the City of London and Isles of Scilly, given their small size. Also, I have set aside £10 million to pilot the delivery of 14-19 diplomas in rural areas.

There will also be resources of £150 million over two years for new school kitchens to promote healthier eating. We expect most local authorities and schools to use their devolved budgets to install kitchens where needed and to improve existing kitchens and dining areas to promote healthier eating. A few local authorities, however, have so many schools without kitchens that this central investment is needed to help them with the costs.

There will be resources of £327 million over three years to encourage local authorities and schools to develop new projects that promote standards and diversity. This will contribute to Fresh Start projects, expansions of popular and successful schools, schemes to remove an authority’s excess surplus places, projects to encourage new school promoters, projects involving new trusts and federations, and small works at maintained boarding facilities, music and dance scheme schools, and non-maintained special schools.

We will run the Basic Need ‘safety valve’ mechanism again. This allows the few local authorities with exceptional growth in pupil numbers to apply to the Department for extra support, where their devolved allocations are insufficient.

We will contribute £300 million schools capital over three years to the 16-19 capital fund, run by the Learning and Skills Council, which provides funding for new places for 16 to-19-year-olds. This fund totals £630 million. Pooling schools and further education capital in this way ensures that investment is available whatever the setting—school sixth-form, sixth form centre or further education college.

Capital resources are also available to continue the specialist school and sustainable transport programmes, for teachers TV, and to meet existing commitments, including projects from previous rounds of the targeted capital fund.

National Expectations

As our long-term strategic programmes start to roll out, I am also setting out the Government’s expectations of how local authorities, dioceses, schools and others involved in capital programmes should plan to make the most of investment now and to ensure that the investment, once made, is maintained.

The Government want to encourage better long-term, strategic planning of capital investment, linked to the delivery of services to children, young people and families. Authorities involved in Building Schools for the Future have developed the ‘Strategy for Change’ and a version of this will be implemented for primary schools in all authorities during 2008. We also plan to pilot integrated strategies for change, covering early years, schools, 14-19 and youth investment. Schools, local authorities and dioceses must address both national and local priorities in their plans. The Department plans to work with local authorities to define and agree how to forecast outputs for capital investment and to report on these. This will provide information for the construction sector to help with planning, and will show Parliament and the public what has been achieved with taxpayers’ money.

Large numbers of primary, secondary and special schools are in line to be modernised through our strategic programmes. We encourage local authorities, dioceses and schools to plan their use of the other billions of pounds of funding they receive to modernise still more schools, or parts of schools, by adding to the primary capital programme and addressing need in areas not yet in Building Schools for the Future. We wish to encourage local authorities to target at least two thirds of their allocations in this way, while recognising that some cyclical and reactive maintenance is also required.

The Government will continue to embed excellent, sustainable design in all capital works, and my Department works with many influential design bodies to improve school design. We also work to ensure efficient and sustainable procurement and construction. The budgets for Building Schools for the Future, academies and one-school pathfinders includes £110 million for carbon neutral schools, as previously announced, and we are also investigating ways of achieving ‘zero carbon’ new school buildings. Efficiency also means that we want all authorities to plan to remove excess surplus places.

The Government also want to work with local government, dioceses and schools to ensure that buildings, once modernised, are maintained properly. Schools themselves have an important role to play, and they must expect to use both their revenue and capital resources to maintain their buildings in good condition. We have introduced a two-tier rate of devolved formula capital grant for schools to reflect fairly the different investment needs of schools that have been rebuilt or refurbished and those that are still in unmodernised buildings. A typical unmodernised primary school of 250 pupils will receive the higher rate of £34,000 a year and a typical unmodernised secondary school of 1,000 pupils will receive £113,000 a year. Where it has been new built, rebuilt, or more than 80 per cent. refurbished, however, a similarly sized primary school will now receive a new standard rate of £17,000 a year, and a secondary school, £56,000 a year. This is a fair rate to allow good maintenance and small improvement projects. The definitions of which schools receive each rate have been simplified to take account of responses to the summer consultation.

All other proposals in the summer consultation have been implemented. The full consultation document and a summary of the responses will be placed in the House Library, together with details of the allocations to local authorities.

To conclude, this is an excellent capital settlement for schools. The Government look forward to working with schools, local government, dioceses and the private sector in the coming years to achieve sustained and lasting improvements in all our schools and so to improve the education and life chances of our children.

Budgets by Programme

The table below gives a breakdown by programme of schools capital investment for 2008 to 2011. The Department will issue shortly guidance on the programmes.

Conventional capital investment is made through capital grant, and for local authorities through a mix of capital grant, supported borrowing and private finance initiative credits. In response to representations from local government, the settlement strikes a new balance between capital grant and supported borrowing -with the amount of supported borrowing reducing by almost half, £500 million, by 2010-11.

Schools Capital Investment: 2008-11





Devolved Programmes


Devolved formula capital (note 1)




Sustainable transport plans




Specialist schools




Local Authority Areas

LA modernisation (note 2)




LA new pupil places




LA schools access (note 3)




LCVAP1 (includes proportionate share for VA schools for new pupil places, modernisation, and schools access (note2, note 3)




Other ICT




Extended schools




Strategic Programmes

Primary Capital Programme (note 4)




Building Schools for the Future (including Academies) (note 4)




Targeted Programmes

TCF: prior commitments (including one-school pathfinders) and Basic Need “safety-valve”




TCF: 14-19 diplomas and special educational needs and disabilities




TCF: Kitchens




TCF: Standards and diversity (note 5)




Teachers TV




16-19 capital fund – contribution (note 6)




Total Capital Investment in Schools





note 1: Includes an element of transitional funding in 2008-09 in respect of changes to the allocation methodology. Figures for 2009-10 and 2010-11 are indicative. The lower 2010-11 figure reflects increasing numbers of modernised schools on the new

standard rate.

note 2: Baseline budget for LA modernisation is £594 million each year, and £237 million for LCVAP. £232 million (LA modernisation) and £58 million (VA modernisation) has already been paid as an advance in 2007-08. The figures in the table take account of payback of the advance.

note 3: Schools Access increased by £ 15 million (of which £3 million in LCVAP) to compensate for changes to the devolved formula capital allocation methodology.

note 4: Strategic programmes include £l,320 million of PFI credits in each year. Most of this is for Building Schools for the Future, but some may be used for the primary capital programme, where a BSF local education partnership is used to procure the

investment, and PFI financing offers best value for money.

note 5: Includes: incentive funding for expansion of successful and popular schools programme; LA schemes to remove excess surplus places; Fresh Start; trust and federation projects; new promoters projects; small works at maintained boarding facilities, Music and Dance schemes schools; and non-maintained special schools.

note 6: Schools capital contribution to the 16-19 capital fund for schools and further education institutions, which totals £210 million in each of the years 2008-09 to 2010-11. This is administered by the Learning and Skills Council.

1LCVAP = Local Authority Co-ordinated Voluntary-Aided Programme.

Details of the capital allocations to each local authority, its schools and local dioceses can be found at:

Environment, Food and Rural Affairs

Flood Defence

I am pleased to tell the House that annual Government spending on flood and coastal erosion risk management will rise to a minimum of £650 million in 2008-09, and £700 million in 2009-10, reaching £800 million by 2010-11 as I announced on 2 July. These figures compare with a forecast spend of some £600 million in 2007-08.

These figures are the minimum we propose to spend in each of the coming years but it is too early to determine whether this will be the final allocation, or whether it will be possible to go further. We will need to take account of the independent lessons learned review into this summer's floods, chaired by Sir Michael Pitt.

Innovation, Universities and Skills

Higher Education Students (Loans, Grants and Fees)

On 5 July 2007 my right hon. Friend, the Secretary of State for Innovation, Universities and Skills, announced that the minimum threshold of family income for a full maintenance grant would be increased from £17,500 to £25,000; and that the threshold for eligibility for a partial maintenance grant should rise to £60,000. This will mean that one third of eligible students entering higher education in 2008-09 will be entitled to a non-repayable grant of up to £2835; and another one third to a partial grant. Once these measures are fully implemented we estimate that 50,000 more students each year will receive full grants and over 100,000 extra students each year partial grants.

I placed a memorandum in the Library on 2 July giving details of the increased loan, grant and fee rates for the 2008-09 academic year. These are unchanged. However the detailed tables also included in the memorandum gave income thresholds for the maintenance grant and non means tested element of the student loan which have now been raised. I have now placed a revised memorandum in the Library which includes revised tables which make clear the levels of support available to new entrants in 2008-09, as well as tables of support for continuing students.