Sunday 12 December 2010

Up Coalition Street without a paddle

Pupil-premium labelled a ‘con’, council budgets cut, coastguard stations reduced, Olympic security budget under threat and House of Lords to discuss tuition fees - they don’t make it easy for themselves

The government's promise to give schools extra money for every child they take from the poorest homes will result in some in the most deprived areas losing cash, Labour will claim as the coalition sets out the fine detail of its austerity measures for schools, councils, the police and transport.

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Nick Clegg confirms for the first time in a letter to the shadow schools secretary Andy Burnham, seen by the Guardian, that the government is protecting per-pupil funding only in cash terms, not real terms, a de facto cut of millions of pounds. It also reveals that the future funding mechanism for the new £430 "pupil premium", which will be announced tomorrow, could concentrate the money on disadvantaged pupils in shire schools instead of urban ones.

Burnham labelled the plan "a con". Senior Liberal Democrats were forced to defend the scheme, which is central to the rehabilitation of the party's progressive credentials as the tuition fee row rumbles on. One poll at the weekend suggested their support for £9,000 fees had cost them half their votes, as the opposition leader, Ed Miliband, made a "clear offer" to the rebel MPs to work with Labour.

The government will tomorrow publish a localism bill, devolving power to local areas, but separately it will detail its latest austerity measures dictating where the £81bn deficit reduction plan will fall locally in the next year. For the first time people will learn where the cuts will fall in their neighbourhoods. The announcements include:

• Councils will learn their budgets for next year, with average cuts of 10.7%. The cuts will trigger the first major wave of announcements of the closure of library, sports and childcare facilities.

• The number of coastguard control stations will be reduced from 19 to eight with only three 24-hour operations remaining for the whole country to save £7.5m. Sources in the transport department said satellite technology meant local control centres were no longer necessary, confirming that 250 jobs would be lost. The search-and-rescue operation will be outsourced, removing military crews – currently including Prince William – in a £7bn deal.

• Individual police forces will be set their budgets, with an average cut of 6% for next year. Reduced road repair budgets will be announced.

• The Olympic security budget is under threat with some sources suggesting it could be reduced in the crucial run-up to the 2012 Games. The Home Office tonight insisted it had protected the budget, indicating that some last minute rearrangements had taken place.

• The plan to raise tuition fees will be debated in the Lords on Tuesday, giving Labour peers and rebel Lib Dems another chance to challenge it – and presenting another flashpoint for student protests.

Clegg is struggling to ride out the storm over the split tuition fees created in his party. Today, his deputy leader, Simon Hughes, said he hoped there would be further concessions on higher education, including reversing some of the 80% cut to universities' teaching budgets, should the economy improve. Asked on Sky News how the party recovers from the split, he said: "It recovers by coming forward with the distinctive and radical policies that we have always campaigned for, it recovers by being strong on civil liberties, by delivering as we have started to do the getting rid of identity cards, the reduction of detention without trial introduced by Labour."

Greg Mulholland, one of the 21 Liberal Democrats who rebelled last week, said: "People in the wider party, not just the parliamentary party, are hurting. It is important that Nick gets out to the wider party and reassures people that the coalition is not only doing a good job for the country but also that it is the right thing for the Liberal Democrats as a party."

The Clegg letter, received last week, says there is a case for giving higher levels of additional funding for deprived pupils in areas where the overall funding for schools is lower. A spokesman confirmed that this year the pupil premium would be a flat rate but in subsequent years it could be bigger for areas that have been traditionally underfunded.

Burnham said: "The pupil premium is a con. There is no extra money for schools. So this premium, which was meant to be additional money for the most deprived, will simply recycle funds from one school to another. It is robbing Peter to pay Paul."

A Lib Dem spokesman said: "It's £2.5bn of extra money that we are putting in and it's being put in because of the Liberal Democrats in the coalition. We aren't just dressing this money up, this is money that at a time of cuts we've found."