The following is an excerpt from Hansard from 15 June 2010.
Jon Cruddas (Dagenham and Rainham) (Lab): Thank you, Mr Sheridan, for giving me an opportunity to say a few words. I wish to make a few comments and raise a few questions about the future of the Building Schools for the Future programme in the London borough of Barking and Dagenham. To begin with, I shall refer to a couple of recent statements emanating from the new coalition Government which imply that different positions on the future of the programme are being developed in the Department for Education.
First, in response to a question from my hon. Friend the Member for Heywood and Middleton (Jim Dobbin) at the first Prime Minister's questions following the recent election, the Prime Minister said:
"I know that the hon. Gentleman will be pleased to see that in making the £6 billion in-year reductions-many warnings were given about what that would mean-we have protected the schools budget, and ensured that schools and Sure Start are protected. In terms of building schools for the future, let me be clear: our plans-and our passion, when it comes to education-are to ensure that new schools are provided so that we have real excellence, in the secondary sector in particular. That is what it is about. Building schools for the future is exactly what our plans involve."-[Official Report, 2 June 2010; Vol. 510, c. 430.]
That was, of course, very good to hear and very welcome in our part of London.
Given that response, I was slightly unnerved to come across some recent press coverage which implies that a slightly different approach is being developed in a different part of the Government. I refer the Minister to a report in Building magazine of 4 June headlined "Government to halt BSF projects within weeks". The article states:
"The government could announce a formal halt to the £55bn school building programme within weeks, amid growing pressure from contractors for clarity over the future of the scheme. It is understood that the Department for Education is likely to make an announcement alongside or before the Budget on 22 June in response to uncertainty about the status of projects under the Building Schools for the Future initiative...officials are preparing to put all schemes that have not reached preferred bidder stage on hold...These include about £2bn of projects approved by the previous government as far back as last July...It is understood that all projects that have received financial close and virtually all those at preferred bidder stage will progress as planned, although sources have warned there may be 'some grey areas'."
Since the report in Building and the Prime Minister's welcome words a couple of weeks ago, the Department seems to have gone quiet on the subject. The only trace of formal comment I could find was a 10 June press release from the Department which was headlined "Department for Education statement on BSF". It stated:
"The Department for Education has not taken any decisions on the Building Schools for the Future (BSF) programme. The Department is reviewing BSF to ensure that when we build schools for the future, we do so in a more cost-effective and efficient fashion. Any future rollout decisions will be announced in due course."
Therefore, today I search for a bit of clarity on the status of the programme, with specific reference to the situation in east London. This is a vital issue for all residents, parents and political representatives in the council and here in Parliament.
Before last month's elections, Barking and Dagenham was due to receive some £275 million of capital investment in secondary schools through the BSF programme. The programme included £250 million for school buildings and £25 million for information and communications technology investment. The BSF programme will enable the council to modernise all its secondary schools, including Trinity special school, and to build a new secondary school that will include special school provision in Barking Riverside, which is a major regeneration site in east London. The programme includes the modernisation of all the ICT provision in schools, and two schools-Dagenham Park Church of England school and Sydney Russell school-are sample schools for the procurement process.
The outline business case was approved by Partnerships for Schools in July 2009. Since that date, the council has been involved in the procurement of a local education partnership-LEP-to build schools and provide facilities, and a managed ICT service provider partner, to provide a managed ICT service for the schools.
Contracts were advertised in the Official Journal of the European Union in August 2009, which named the London borough of Havering and Thurrock council in Essex as contracting authorities, as well as ourselves in the London borough of Barking and Dagenham. That means that both those bodies can use our LEP when formed should they choose to do so, although they will fund their own developments. If they use the LEP, as shareholders in the LEP we would reap a shareholder return.
Let me mention a few specific points. On 8 June, the borough cabinet approved a recommendation for the ICT selected bidder. Yesterday, the cabinet approved the LEP selected bidder. Notwithstanding the fact that we do not yet know the Government's position on the future of the BSF programme, and assuming that we are able to continue the process, we would expect to achieve financial close in late summer or early autumn-a matter of weeks away.
Given the press coverage that I alluded to earlier, we must assume from those reports that the £55 billion national BSF programme is under threat from the new coalition Government, as part of their public sector cost-cutting drive. If the Government decide to scrap the programme in the next few weeks-as has been rumoured-that will have a huge impact on Barking and Dagenham. Critically, if BSF is cancelled or significantly delayed, from 2012 there will be a significant and growing shortfall in school places in our borough.
Council projections suggest that the borough will need an additional 2,250 secondary school places by 2015, rising to 2,875 places by 2017. Perhaps the Minister is aware that this part of London has been subject to extraordinary demographic change over the last few years, much of it off the radar of the state because it has occurred since the 2001 census. Those changes should not be underestimated in terms of the sheer velocity of movement into the borough.
Local councillors are also worried that, in addition to BSF funding, the primary school capital programme could be hit by Government spending cuts in the near future. The number of primary school places needed is estimated to rise to 11,595 by 2017. Over the past few years, the rate of increase in births in the borough has led to a significant rise in the demand for school places.
For example, in 2000-01 there were 2,380 births in the borough. By 2007-08 that number had risen by over 50% to 3,541. In addition to the extra pressure on school places due to the higher birth rate, the borough remains a significant area of economic regeneration. It has the lowest-cost housing market in Greater London, which has acted as a magnet for young families moving into the borough over the past few years. The housing represents good value and is attractive to young families, which in turn places additional pressures on our school places and buildings, and on the physical infrastructure across the borough.
The current coalition Government place great store in their new politics, in greater transparency in public policy making, and in ensuring that they give the public a major say in where the cuts should be made. I am sure that I speak for many parents in Barking and Dagenham by saying that one area where we do not want to see cuts is in money that is desperately needed to modernise our school buildings to make them fit for the 21st century.
If BSF funding is cut for the borough's schools it will have huge implications, not only for our schools but for the regeneration agenda, which I touched on briefly. If we do not receive BSF investment, the knock-on lack of school places will have a big impact on housing development across London and at the heart of the Thames gateway. Without investment in our schools, we will not be able to meet demand. We will have a shortfall in school places which, in turn, will make the borough a less attractive place for young families to move to.
Last week, the council leadership wrote to the Chief Secretary to the Treasury to seek assurances on BSF funding. The council now intends to step up the campaign at local level to save funding for the borough's schools by organising an online local residents petition to the Prime Minister. It is also urging local people to write to the Prime Minister, calling on his Government not to abandon BSF investment. I can fully understand both initiatives. The stakes, for BSF and local education provision, are high.
The possibility of major cuts to the BSF programme must be seen alongside other cuts at local government level. Following announcements in the past two weeks by the Chancellor and the Department for Communities and Local Government about the Government's economic savings plan, local councils across the country are being required to find an extra £1.165 billion in savings, amounting to 20% of the Government's £6.2 billion in cuts to public expenditure this year.
That means that the borough of Barking and Dagenham will have to find additional savings of between £4 million and £5.8 million in the next year, on top of savings of approximately £14 million this year to offset some of the losses, especially in the operation of the housing revenue account, which have put great pressure on the authority's budgetary process.
The precise amount of the cuts will not be known until the new Conservative and Liberal Democrat coalition reveals its full emergency Budget next week, but there are already worries that housing money and Government cash normally reserved for local authorities in charge of areas with significant deprivation will be cut.
There are also concerns at local level about the future of funding for the 18 children's centres in our borough. I understand that the funding grant is secure until the next comprehensive spending review in March 2011, but the future is uncertain after that. Moreover, although BSF does not affect primary schools, a primary capital programme exists, and there is concern for the future of that funding string as well.
Overall, therefore, BSF is vital to the overhaul of the secondary schools in our borough to help us meet the extra demands created by the birth rate and patterns of migration in east London. BSF is a major investment programme that will totally modernise all schools in the authority, including our special school. Works will vary from major rebuilding, remodelling and refurbishment to combinations of the three. The only exception among the secondary schools is the recent new-build Jo Richardson community school, which will receive ICT investment.
The borough has a selected bidder for the ICT, as well as an LEP-selected bidder. We hope to finish the whole process by late summer, assuming no policy change at the national level. We therefore seek reassurance for the project as a whole. The BSF LEP-selected bidder has passed the various stages of the BSF LEP evaluation process. The BSF programme is a key element of improving the well-being of children in the borough, reducing inequalities and ensuring integrated children's services, given the guidance that we received under the Childcare Act 2006.
BSF will bring many benefits to the borough, including extended schools, raised attainment and expanded education services as the school-age population in the borough grows. I therefore return to the two quotes that I reported at the beginning of my contribution. I welcome the commitment to the BSF programme that the Prime Minister made clear among his first parliamentary answers. I hope that the Minister can support the programme in Barking and Dagenham, not least because we have concluded the selected bidder part of the process and are nearing completion of the total process, which is why the report in Building magazine caused such concern locally. We seek reassurance that our scheme will not be put on hold. The magazine stated that
"all those at preferred bidder stage will progress as planned, although sources have warned there may be 'some grey areas'."
I simply seek reassurance that we will proceed as planned and that we are not one of the grey areas. The borough's changing demographic profile, birth rates and existing pressures on the education sector combine uniquely, with the result that this capital programme is vital for our residents and children. I look forward to the Minister's response and, hopefully, to some reassuring noises.