Madam Deputy Speaker, I should like to begin by thanking Mr. Speaker and you for granting me this debate. Since I was first elected in 1997, I have attempted to bring to the Government’s attention the problems and costs of delivering public services in a thinly populated rural county. Shropshire is one of the largest inland counties, but with 289,000 inhabitants it is one of the least populated areas of the United Kingdom. It has some of Britain’s most stunning scenery, but the long distances between its small towns and villages make the delivery of public services costly and difficult.

Despite the geographical challenges, Shropshire county council is to be congratulated on being one of the best performing counties in England; it is judged to be a four-star council. It is one of only two children’s services authorities to have consistently received top grades against all headings under Ofsted’s annual performance assessment process.

Shropshire has 141 primary schools, 22 secondary schools and two special schools. In 2007, Shropshire performed ahead of the national average on all 11 indicators for seven-year-olds. The pattern of results in Shropshire has largely mirrored or exceeded national changes. This year, we again secured top grades against the five every child matters outcomes. Shropshire’s performance has remained ahead of the national average for 11-year-olds in English, mathematics and science. Its performance has also remained ahead of the national average on eight of the nine available indicators for 14-year-olds and has moved further ahead in the key level 5-plus indicator in English and mathematics. For 16-year-olds, the indications are that the results for GCSE or equivalent are likely to be the best ever recorded in the county. All results of the seven available indicators have improved over the 2006 county figures, and they have moved further ahead of the equivalent national figures in six of the seven indicators. Shropshire is ranked either first or second on all the main indicators. Attendance in Shropshire continues to be over the national average, and Shropshire’s permanent exclusion rates remain low in comparison with other authorities in the west midlands.

That splendid track record is all the more remarkable when one considers that Shropshire is the second lowest funded of all 34 England upper-tier authorities. Shropshire’s guaranteed unit of funding per pupil for 2007-08 is £3,551. Based on 39,218 pupils as at January 2007, that delivers £139.3 million in dedicated schools grant to Shropshire. All-England average funding is £3,888 per pupil, leaving Shropshire with £337 less per pupil. If Shropshire received the funding of an average local authority, there would be £13.23 million more to spend on Shropshire’s children.

I congratulate my hon. Friend on securing this important debate. Coleham primary school in Shrewsbury receives, on average, £711 less per pupil than the national average. That equates to a deficit of £300,000 for just one school. The headmistress has asked to meet the Minister to discuss how on earth she will cope with that massive deficit.

I am most grateful to my hon. Friend and neighbour for that support, but I am afraid to have to tell him that the position is going to get worse, because in 2010-11 the gap increases to £385, leaving Shropshire’s children £15.1 million behind.

Let me address this particularly to the Minister: I am not calling for a single penny more in taxation to be levied for education. Shropshire’s hard-working taxpayers are already taxed quite enough. My criticism is of the formula that distributes so much less taxpayers’ money back to Shropshire per pupil from Whitehall. The City of London receives £7,089 per pupil and Tower Hamlets receives £6,028, as against Shropshire’s £3,551. Perhaps a direct comparison would be with Ealing, which, with an almost identical number of pupils—39,250—receives £4,634 per pupil but in a much less sparse area. If Shropshire’s children received Ealing’s funding per pupil, they would have an incredible £42,486,428 extra. I repeat that I do not want a penny extra to be raised in tax, but I would like the Minister to explain how these extraordinary disparities come about. Does he believe that it is fair that a child in the City of London should receive back from general taxation twice what a child in Shropshire receives?

Following on from my hon. Friend’s excellent point, the comprehensive spending review has just locked in funding per pupil for the next three years. In Shropshire and other rural authorities in the neighbouring area, we are now locked into well below average settlements because the Government have decided to abandon the previous formula, which was at least transparent and based on deprivation indices and others. That has been swept aside, and for the period of the CSR they are looking solely at increases based on percentages. That means that authorities at the bottom of the league table, such as Shropshire, which is sixth from bottom—[Interruption]—and, as my hon. Friend the Member for Gainsborough (Mr. Leigh) says, Lincolnshire, will now be locked into that disparity, which will widen over the next few years.

My hon. Friend makes a very good point, and I am most grateful to him for coming with me to see the county council. I think that we have been there three times in the past three weeks. But again, the position is worse than he said.

Shropshire’s excellent education system is facing a major crisis that is wholly avoidable. Shropshire county council is predicting significant demographic change. There is a rising population with a relatively higher concentration of older people, and there is currently a decrease in the number of children under five, and in primary education. According to the county council’s figures, there will be 3,400 fewer pupils on the roll from 2001 to 2012. There are currently 2,500 unfilled primary school places, which will rise to 5,450 by 2012. That is predicted to lead to a cumulative shortfall of £3.8 million by 2010-11.

The council is proposing to debate a paper on reorganising primary schools in Shropshire on Friday 14 December. My hon. Friend the Member for Ludlow (Mr. Dunne) and I have discussed that, and my hon. Friend the Member for The Wrekin (Mark Pritchard) saw the council only last Thursday. I have great sympathy for the position of the council, which faces the dilemma of receiving less from central taxation than the vast majority of other authorities, while trying to deliver high-quality education in the face of current falling rolls.

However, the fall in primary school numbers is hard to understand in the light of the extensive new building that has occurred in Shropshire recently, and the dramatic increases planned for future years. It is also worth noting that live births in Shropshire bottomed out in 2001, at 2,628, rising to 2,767 in 2005. Another factor that should be borne in mind is that women are choosing to have children later, so nationally, fertility rates for women aged 30 to 34 rose from 78.2 births per 1,000 women in 1986 to 104.6 per 1,000 in 2006. Current research suggests that the trend towards later maternity is strongest among women with better educational qualifications, with some postponing child rearing to pursue their careers. That could well be the case in Shropshire, where there has been an unprecedented increase in mid-range housing with an average age of occupants that conforms more with higher birth trends, which may, therefore, fuel an unexpected surge in the school-age population.

Another factor that is almost impossible for the council to estimate is the increase in population owing due to the Government’s abject loss of control of immigration. The most graphic example of that was the Government’s prediction, when Poland acceded to the EU, of 13,000 Polish immigrants working in this country, whereas the actual figure was well over 600,000. Ironically, 13,000 babies have been born to Polish women in this country since EU accession. Population estimates assume inward migration contributing nearly 6 million to the projected rise of 7.2 million in the UK’s population between 2004 and 2031—equivalent to six cities the size of Birmingham over the 27-year period.

Poles have always been welcome in my constituency thanks to a significant Polish community in Penley, just over the Welsh border, who stayed on after the second world war because, tragically, it was too dangerous for them to return to socialist Poland. Vans with names dominated by consonants are common in the area. Following Poland’s accession to the EU, a significant population of Polish people has built up in nearby Wrexham and Crewe. Road signs near Whitchurch written in Polish attracted national attention earlier this year.

Advantage West Midlands commissioned the university of Warwick to write a paper on the economic impact of migrant workers in the west midlands, which reported in November 2007. It said:

“The West Midlands Migrant Worker Survey revealed that for a substantial proportion of migrant workers initial plans about length of stay in the UK had changed. On balance, the tendency was for migrant workers in the sample to decide to stay longer than first anticipated…The presence of children will also increase the demand for school places.”

I hope that that shows that it really is impossible for the county council to plan ahead with complete accuracy given the totally inadequate quality of Government data in this area.

I hope, however, that the Minister recognises that the current system of education works well. That situation is very much due to the number of small schools that provide local education and parental choice. Having visited every school in my constituency in recent years, I can confirm that competition among schools guarantees higher standards as schools strive to satisfy parents, knowing that those parents often have an alternative so long as they possess a car.

Last Thursday, I visited Childs Ercall Church of England primary school, whose future is up for review because it fails existing criteria on pupil numbers established by the last Lib Dem-Labour council. First, the governors and the chairman of the parish council disputed the predicted numbers and were confident that given new housing they would achieve the current minimum numbers required, but they stressed that the village of 237 houses has only a village hall, a church, a working men’s club and no other public facilities. David James, the chairman of the parish council, has said:

“Facilities are being bled out of the countryside and that is a thoroughly bad development.”

My hon. Friend is making a compelling case. He is absolutely right to underline the fact that migration within the European Union and immigration from outside the EU is having an impact on Shropshire. In fact, 36 per cent. of the housing growth in Shropshire over the next 10 years will be as a result of those factors. I do not believe that my area will be affected by any reorganisation of schools, for which I am grateful, but Shropshire has been short-changed for too long. I endorse and fully support my hon. Friend in saying that this must end.

I am most grateful for my hon. Friend’s support. I know that we can count on him in future discussions.

The school buildings at Childs Ercall are currently used for out-of-hours activities, including a breakfast club, a computer club and other community enterprises. That is entirely in line with stated Government policy. The building schools for the future programme website states:

“Schools are no longer just about what goes on in the classroom during school hours. The modern vision of extended schools sees schools as assets at the heart of the community, which everyone can use and benefit from…Building Schools for the Future…provides an opportunity to be innovative in the ways schools work and to explore new ways in which they can involve the local community, adults, families and local business partners”.

Ironically for Childs Ercall, the website even lists breakfast and after-school clubs as aims of the initiative. However, the building schools for the future programme, which was talked up by the Secretary of State for Children, Schools and Families in his statement this afternoon, is not due to arrive in Shropshire until 2013. Could the Minister consider bringing Shropshire’s schedule forward within the existing budget?

The Secretary of State said today that his consultation had revealed that “children and young people told us that they wanted more places to play” and “interesting things to do outside school”, and that the Minister for Children, Young People and Families had set out a strategy promising “places for young people to go to in every constituency of the country…funded by proceeds from unclaimed assets and new investment from my Department.” Do Shropshire’s school facilities qualify?

I am most grateful to my hon. Friend for allowing me to intervene again. What he is saying is important. The Secretary of State made much of consulting parents this afternoon—[Interruption.] I am pleased to see him entering the Chamber. He made much of consulting parents on being given more information about their child’s progress. What the parents of the children in 20 primary schools in Shropshire threatened with closure care about is ensuring that they have a school in their local village for their children to attend, rather than having them bussed into a town or village miles away. It is schools that those parents want, not play areas.

I am most grateful to my hon. Friend. Happily, the Secretary of State has just turned up, so perhaps the Minister can confer and give us a clear reply.

Successive Ministers have promised to defend rural schools. At the time of the countryside march in February 1998, when he was the Minister responsible for school standards, the right hon. Member for North Tyneside (Mr. Byers) said:

“When a school closes a village loses a vital focus…setting a spiral of decline. This is what we want to stop.”

In May 2000, the current Home Secretary, who was then the Minister responsible for schools, said:

“Rural schools are often the lifeblood of local communities. I know there are difficult decisions that local authorities have to take but in the case of village schools, we were right to put the village before the planner.”

The chairman of governors of Adderley Church of England primary school, alarmed at the proposed reorganisation of Shropshire primary schools, has also told me that the Under-Secretary of State for Environment, Food and Rural Affairs, the hon. Member for Chatham and Aylesford (Jonathan Shaw), said on “The Westminster Hour” on 4 November that the Government have a policy to keep rural schools open.

I have also had approaches from Maesbury primary school and Selattyn Church of England primary school, which are indicative of the huge confusion and disruption that will be caused to Shropshire’s primary schools if a reorganisation leads to the closure of a number of schools. The proposals will be deeply unpopular with parents and grandparents, as well as being most upsetting for staff and, above all, the children involved. Councillor Keith Barrow has put down a motion to Oswestry borough council, while Councillor Gerald Dakin has laid a similar motion before North Shropshire district council. This is all so unnecessary. We would not even be discussing the issue tonight if Shropshire received a fraction more of the central funds from the taxpayer that are awarded to other authorities.

Given the unreliability of current population data, particularly on immigration, now is no time to close schools that take decades to establish and build a reputation. They may even have to be reopened or, worse, new schools may have to be built, at great public expense, to cope with an influx of new pupils.

I repeat that I am not asking for a single penny more to be levied from the British taxpayer. I am simply asking for a proportion of taxpayers’ funds to be returned to the county of Shropshire in order to make a bitter and costly closure programme unnecessary. The Government have established the primary capital programme for improving existing schools. Could this be brought forward? Finally, would the Minister agree to meet me, with other Shropshire colleagues and representatives from the council, to find a solution to our modest requests? Unless a solution is found, irrevocable damage could be done to Shropshire’s exceptional system of primary education, with an inevitable further impact on the county’s isolated rural communities.

I congratulate the hon. Member for North Shropshire (Mr. Paterson) on securing this debate. I welcome this early opportunity to bring the issue of school funding to the House following the recent announcement of the revenue and capital settlements for the next three years. I would first like to congratulate the teachers and pupils in the hon. Member’s constituency, and in the whole of Shropshire, on their continuing hard work and achievements. He referred to some of those achievements in his speech.

This year, 82 per cent. of Shropshire pupils aged 14 reached the required standard in English, and 79 per cent. did so in mathematics. That is 2 percentage points above the national average in each subject. Meanwhile, the number of 15-year-olds in Shropshire achieving five higher GCSE passes or the equivalent continues to be well above the national average. In all subjects, including English and maths, young people in Shropshire achieved 5 percentage points above the national average at GCSE last year.

Let me turn now to school funding. It is important to remember that all local authorities have seen substantial increases in funding under this Government, and that is the context in which we should consider this evening’s debate. Total revenue funding per pupil for education in Shropshire went up by £1,120 in real terms between 1997 and 2005. That is an increase in real terms of 38 per cent. From 2006, we introduced the dedicated schools grant and a two-year school funding settlement. This gave Shropshire increases in core funding for schools of 6.6 per cent. per pupil last year, compared with their spending the year before, and a further 6.4 per cent. per pupil this year. What has the increased investment bought? Since 1999, Shropshire schools have been able to employ 160 more teachers and 820 more support staff.

Spending on school buildings has also increased dramatically. Ten years ago, the allocation for Shropshire was £5.1 million. For the years 2005-06 to 2007-08, we have allocated £37.4 million of capital to Shropshire council and its schools. This includes more than £7 million of targeted capital funding, following the council’s successful bids for support for two major capital projects.

Will the Minister give way?

If the hon. Gentleman will forgive me, I will not give way, because this is a conversation between the hon. Member for North Shropshire and me, and we agreed that the hon. Member for The Wrekin (Mark Pritchard) would intervene in the first part of the debate.

Looking ahead, we have just announced the first ever three-year school revenue funding settlement, enabling local authorities and schools to plan ahead with greater certainty. The settlement allows for continued real-terms growth in school funding over the next three years, although at a more modest rate than in recent years. Across the country, total school revenue funding will rise from £36.5 billion this year to £41.9 billion in 2010—an average year-on-year increase of 2 per cent. in real terms.

This settlement allows us to target money on our priorities. Those include making available by 2010 £912 million to support the extension of a personalised offer to all pupils, including those with special educational needs, and £315 million to help to improve the rate at which children progress, ensuring that all children can meet their potential, and that those who are behind expectations, or are falling behind, get back on track. We will also make available £340 million by 2010 to support the extension of the entitlement to free nursery education for three and four-year-olds from twelve and a half to 15 hours, and £490 million by 2010-11 to support the development of extended services in our schools.

In addition, Shropshire will get an increase in its dedicated school grant of 13 per cent. per pupil over the next three years. That is just below the national average of 13.1 per cent. per pupil. So by 2010, Shropshire’s guaranteed funding per pupil through the dedicated school grant will be £4,013, up £462 per pupil on this year.

I understand the concerns expressed by the hon. Member for North Shropshire about funding for schools in Shropshire, especially when compared with the funding that other areas receive. I am sure that other hon. Members—including my hon. Friend the Minister for Schools and Learners, who is in his place for this debate and who has a constituency in the rural county of Dorset—will recognise the challenges that we face.

First, though, I should like to explain the reasons behind the differences in funding in different areas of the country. We need to ensure that we have an appropriate balance between basic funding and funding that recognises the different needs of each area. As the hon. Member for North Shropshire noted, some parts of the country—especially London and the other conurbations, such as Birmingham, that have inner-city areas—receive additional funding. That is because it costs schools more to recruit and retain teachers and other members of staff in those areas.

Other areas, including Shropshire, receive additional funding because, as the hon. Member for North Shropshire mentioned, they are sparsely populated and have many small rural primary schools that are more expensive to run. However, the main reason for differences in the level of funding that we provide to different local authorities is the emphasis that we place on targeting funding on disadvantaged pupils. Such pupils are likely to need extra support if they are to have an equal chance to succeed.

There have been improvements in attainment at all levels of education in recent years. Schools in the most disadvantaged areas have improved most of all, but there is still a major gap between the outcomes for children from disadvantaged backgrounds and for other pupils. In 2007, 36 per cent. of young people receiving free school meals achieved five good GCSE passes, compared with 63 per cent. of their peers. Closing that gap is critical to our aim of promoting a fair, prosperous and inclusive society, so we believe that it is right and just to invest our resources where they will make the most difference.

Shropshire has significantly fewer pupils from disadvantaged backgrounds than many other areas, and that is reflected in the level of school funding that the authority receives. Next year, 7.3 per cent. of Shropshire’s funding through the dedicated schools grant will be for disadvantaged pupils, compared with 12.1 per cent. nationally. For the first time, however, money for pockets of deprivation is being included in this funding. An extra £300,000 pounds is included for Shropshire next year, targeted on schools that have high numbers of pupils from deprived neighbourhoods compared with the rest of the county. I am sure that the hon. Member for North Shropshire will talk to his colleagues on the county council to make certain that that funding gets through to the pupils in those deprived areas.

The school funding arrangements for the next three years consolidate the current arrangements that followed the introduction of the dedicated schools grant two years ago, but we need to ensure that we have a funding system fit for the challenges and priorities of the next decade. The hon. Member for North Shropshire has raised some important questions about that.

In January, my Department will launch a major review of the distribution of the dedicated schools grant. We will want to hear from everyone who is interested in school funding, as we work with our partners to shape proposals for the school funding system from 2011. A full consultation will start in autumn 2009, and the funding of schools in rural areas will be one of the issues that we shall want to explore as part of the review.

As the Under-Secretary wants to consult, will he agree to meet me and colleagues from the House and the county council to discuss the matter?

I can confirm that my hon. Friend the Minister for Schools and Learners has already agreed to meet the hon. Gentleman and his colleagues. I have read the letter that the hon. Member for Ludlow (Mr. Dunne) sent to the Secretary of State, and as I said, my hon. Friend the schools Minister has agreed to meet him.

In the coming years, we want to work with local authorities and schools to ensure that we are getting the best possible outcomes for pupils from the revenue and capital resources that we put into schools. The hon. Member for North Shropshire has described the challenges facing the council in Shropshire and its schools as a result of rapidly falling pupil numbers. I stress again that my hon. Friend the Minister for Schools and Learners will be pleased to meet the hon. Gentleman and his colleagues.

Local authorities are responsible for balancing the supply of places in their area to ensure that schools serve the needs of their local communities and provide good quality education in the most cost-effective way. However, surplus places can represent poor use of resources, which can often be used more effectively to support schools in raising standards. With current surpluses in Shropshire as a whole, it must be right that the authority has considered a reduction in surplus places as part of its planning strategy.

I know that local schools are important in rural communities, and we accept that in order to let young children attend a school closer to home, there may have to be more empty places in schools in rural areas than in those in urban areas. Our guidance to decision makers makes it clear that that must be taken into account, and that the presumption against closing rural schools continues. However, even in a rural authority there may be a case for redeploying resources that are tied up in surplus places, to provide a richer educational experience for all young people in a more efficient system. Let me deal with our plans for capital funding. We are investing £21.9 billion in schools nationally over the next three years. That is a sevenfold increase since 1996. For 2008-10, we have allocated £57.3 million for capital investment to Shropshire and its schools to improve their buildings and facilities. That includes £3 million through the new primary capital programme in 2009 and a further £5.4 million in 2010. We aim to renew at least half of all primary school buildings in the country under the programme in the next 14 years.

The hon. Gentleman asked about the building schools for the future programme, which aims to renew all secondary schools in England in 15 waves of investment, which started in 2005-06. The hon. Gentleman may wish to discuss with his hon. Friends plans to dig into and cut from the plans for the future in the case of Shropshire. Because of the late prioritisation, Shropshire is getting money up front. It has been allocated £20.5 million now to renew its neediest school, the William Brooke school in Much Wenlock.

In the meantime, the authority and its schools continue to receive substantial amounts of capital each year to address their priority needs. Allocations of funding to the authority reflect the fact that it has not benefited from modernising schools through building schools for the future.

Our plans for revenue and capital investment in schools provide for continued growth over the next three years, building on the substantial increases of the last decade. I know that the hon. Gentleman shares my ambition for continually improving outcomes for all our pupils for the taxpayer’s considerable investment. I am sure that he will want to raise some of the points with which I have had not time to deal in his meeting with my hon. Friend the Minister for Schools and Learners in the near future.

Question put and agreed to.

Adjourned accordingly at thirteen minutes to Eleven o’clock.