The Secretary of State for Education and Science (Mrs. Margaret Thatcher)
The debate has ranged widely from those who want to abolish direct grant schools to those who for the time being would leave them alone, but not give them any extra money, although that would result in a substantial increase in fees, to those on my side of the House who would positively encourage them because they have such an outstanding academic record and because they have served a wide section of the community and are undoubtedly in great demand by parents. The dilemma was illustrated very well by the hon. Member for Acton (Mr. Spearing) who admitted that there was a direct grant school in his constituency and that, although he disagreed with it, there was a demand for it to stay there. This means that many parents want their children to be able to go to direct grant schools and judging by the number of applications that come into my office, there is an increasing demand for direct grant schools in many areas.
At the moment there are 176 of these schools of which one third are Roman Catholic. Eighty-one are boys' schools, 93 girls' schools and two are mixed. As my hon. Friend the Member for Stratford-on-Avon (Mr. Maude) pointed out, a large number of places are reserved for local education authorities if they wish to take them up. But the essence of direct grant schools is that 25 per cent. of the places must be provided free to pupils who have been in maintained primary schools for a minimum of two years. On top of that proportion there is a reserve for local education authorities of another 25 per cent. if they wish to take them up. At the moment more than 50 per cent. of the places in direct grant schools are paid for by local authorities. In addition, the rest of the places are provided according to an income scale for other parents who [column 1134]send their children to these schools, and that is why it is so important to have a realistic income scale.
As the hon. Member for Acton pointed out, a substantial sum of money comes from the Department to remit fees to parents whose income warrants this remission. At the moment it is about £1 million and the extra will be £0.6 million, so that the total going to parents who pay less than the full fees at direct grant schools will be £1.6 million a year, and it is money very well spent.
A number of hon. Members have said that these schools are for those who are already privileged in terms of income. I have described the number of absolutely free places, admittedly upon the basis of selection, except in the case of two direct grant schools which are comprehensive, but the majority are on the basis of selection by ability. I will now describe the type of income groups which will benefit from the improved income scales.
Some hon. Members opposite have described them as privileged in terms of income. Let us see what that privilege consists of. A family with an income of £20 a week and with one child wishing to go to a direct grant school used to have to pay £46 a year. I hope that no one will say that a family with a total income of £20 a week is a highly privileged family. Under my income scale which has now been introduced that family will pay nothing.
Mr. Albert Booth (Barrow-in-Furness)
How many are there?
They will now be able to apply for the first time. These schools are very greatly in demand. If I could build them all over the country, or, rather, if the foundations would build them all over the country, for it is the foundations which provide the capital cost, not the State, we should have a great extra demand for these places and if there were free places there would be many applicants from families of that income level.
A family with an income of £30 a week used to have to pay £88 a year for a child at school; it is now £36 a year. The family with an income of £40 a week used to pay £136; it is now £72. These are not people with privileged incomes. They are ordinary people who [column 1135]are keen on their children having an excellent education and who wish to encourage these schools.
The capitation grant is the subject of the order. It used to be £52 and that was reduced by the Labour Government in 1968 in spite of many increases in costs, mainly increases in pay to teachers, but including others. They reduced the capitation grant from £52 to £32. We are restoring it to £52 plus the extra £10 to meet further increases in salary scales to teachers. The hon. Lady argues that this increase ought not to be made now. If her argument is correct all of the schools should be taken over totally and all of the places paid for completely. This was her argument. That is her policy. In that case we should be paying not £62 per child at the direct grant schools but a full £187 per child which is the average cost for a secondary school place, and not £84 towards the sixth form place in a direct grant school but a full £300 per child which is the average cost of a sixth form place.
If we were to follow her advice we would be spending even more upon what she has called the privileged sector of the community. In spite of the capitation grant being cut the schools did survive, which was a great tribute to the loyalty and determination of the parents. In so far as the local education authorities do not take up free places those free places have to be provided by the governors out of the fees paid by other parents. The alternatives as I see it would be to increase the pressure on costs, so that the fees would have to rise. Unless the income scales were changed very quickly the schools would soon consist of the [column 1136]necessary 25 per cent. free places at one end of the scale and very high fees at the other, which would be out of the reach of most people.
It is not a situation which most of us would wish to see because it would deprive a number of people who have enjoyed at these schools the benefit of an excellent education suited to their talents. Or there could be a total takeover which would be more expensive. Or we could do what we have done—increase the capitation grant and improve the income scales to keep these schools within reach of many parents.
The hon. Member for Acton (Mr. Spearing) asked me about costs. The actual increase in capital costs £3,100,00 to central funds but is reduced by the lower fees charged to the local education authorities of £1,800,000 leaving a net capitation cost of £1,300,000 net. Add to that the improved income scales, an increase of an extra £600,000 and the actual cost to public funds is £1.9 million. I rounded that up not down. The real difference between us is that we wish to encourage direct grant schools because of the excellence of their academic record and we wish to see them available to many children to whom they would not otherwise be available unless we took the step embodied in these Regulations.
To build may be the laborious task of years; to destroy can be the foolish act of a single day. I ask the House to allow these Regulations to continue in their present form.
The House divided: Ayes 261, Noes 285.