By Lucy Phillips
15 December 2009
Schools Secretary Ed Balls has denied reports that other
public services will suffer as a result of the spending increase given to
education in last week’s Pre-Budget Report.
He told Public Finance
that the chancellor’s plan to reduce the deficit through a rise in National
Insurance and tax on bankers’ bonuses, while giving more money to the NHS,
schools and policing, was ‘the right thing to do’.
‘The real threat to other services and to children’s
services and policing would be if we were to adopt proposals to reduce the
deficit faster,’ he said, adding that rising VAT would have been ‘very damaging
for public services’. Tory
proposals to cut the threshold for inheritance tax were equally harmful, he
added.
The Institute for Fiscal Studies has said cuts to other
government departments would be more severe because of the protection given to
certain frontline services.
Yesterday Balls announced that the bonus payments given to
16 to 19-year-olds who stay in school or college would be scrapped, saving almost
£100m. Teenagers currently receive a means tested allowance of between £10 and
£30 a week as well as a bonus of £100 for every six months they stay in
education.
The savings would be used to expand the basic Education
Maintenance Allowance scheme, providing weekly payments for an extra 80,000
students. ‘We will continue to pay this bonus next year but in order for us to
make the sums up and deliver the extra places, and even with the added money
the chancellor allocated to us, we have to make savings,’ said Balls.
The ‘September Guarantee’, which ensures a place in
education or training for all 16- and 17-year-olds that want one, alongside
apprenticeships, will also be extended.
But current EMA rates will be frozen as part of the drive to
make 3% efficiency savings per year, saving a total of £240m over three years
in the budget for 14 to 19-year-olds.
