Gove's plan to scrap GCSEs will put a cap on ambition

The Education Secretary's "rigorous" approach could undermine a wider drive to raise standards for all.

Today's Daily Mail splash on the future of GCSEs, the national curriculum, league tables and exam boards has the air of a brainstorm session at Sanctuary Buildings that has been released before being fully thought through. Nothing wrong with that, if Michael Gove spends some time thinking through all the implications of what he is proposing. But he needs to be careful that his proposals don't end up undermining a wider drive to raise standards for all.

There are some perfectly good ideas in what appears to be being considered. It makes perfect sense to have a single exam board for each exam. At present, we have several competing boards, and this can see competition that has the effect of lowering standards. The effect of a single board, of course, will be to have a single syllabus in these subjects. Which makes the supposed removal of the national curriculum from secondary schools rather less radical than is being suggested: indeed it would ensure that academies and free schools work to a single syllabus. Lord Baker, the former Conservative education secretary, is right to argue as he did on Today this morning, that it is as important that technical subjects are examined at a high standard as well as Gove's favoured subjects like history and geography. Already they have been relegated as a result of Gove's focus on academic subjects in his English Baccalaureate measure in the league tables.

The second question concerns the proposal of splitting the GCSE into a CSE and O-level-style exam. There is a seductive sense to this idea if you believe that the only impact of GCSEs has been to "dumb down" education. But this is a tabloid caricature. It is perfectly fair to feel that there needs to be more rigour involved in getting an A-grade, but that doesn't mean writing off thousands of youngsters who could today strive for a C. There is a terrible canard in the notion that the use of the 5 A*-C benchmark itself denies ambition: in fact, a C is worth far more to a child than a D when talking to employers, and the existence of the benchmark has led many schools to push such pupils towards a grade they can achieve in a way that the average point score would not necessarily do.

But there is a good argument for saying that achieving an A-grade should be really demanding. With a single syllabus there is no reason why this cannot be achieved in a single exam, particularly since Gove wants to move back to linear testing at the end of two years (instead of gaining many of the marks through modules). That is not to say there is no place for more practical exams in English, Maths and Science. Such tests should be available, however, at the GCSE standard of level 2 as well as the less demanding level 1, and less "academically-minded" students should not merely be expected to achieve level 1. It would be a serious and terribly retrograde step to move in this direction, and Gove will find that it could have as serious an impact as Labour's scrapping of an expectation that all schools study languages through to 16 did on the numbers doing the subject.

This raises the issue of league tables and floor targets. And it is here that Gove could be making his biggest mistake. The big improvements in London and by academies over the last decade have been spurred in part by ever-more ambitious floor targets based on the five GCSE standard - five grade Cs or above, including English and Maths. It is a realistic but relatively demanding ambition for schools to expect a majority of their pupils to reach this level - after all, half failed to do so in 1997 for more than 30% of their pupils - and Gove has sharply increased the demand of the floor targets. Of course, one could set a target based on the average point score - giving different points for an A, B, C, D and E and adding up the best eight subjects - but this could have the perverse effect of lowering expectations in terms of breadth. And since there is no longer a strong incentive to use high GCSE vocational alternatives (in future these qualifications will be worth one rather than two or four GCSEs regardless of the learning hours involved), the main concern here has been addressed. By all means publish a five-A target alongside this, though in truth the EBacc is becoming the more rigorous target here.

Gove has time to get this right. More rigorous GCSEs, particularly for top achievers, do not have to place a cap on ambition for many other students. More practical business-focused English and Maths tests should not themselves be set unambitiously. And Gove should not throw away one of the most effective drivers of higher standards for schools in the process.

Education Secretary Michael Gove is set to replace GCSEs with O-level style exams. Photograph: Getty Images.

Conor Ryan was senior adviser on education to Tony Blair from 2005 to 2007.

Show Hide image

Q&A: What are tax credits and how do they work?

All you need to know about the government's plan to cut tax credits.

What are tax credits?

Tax credits are payments made regularly by the state into bank accounts to support families with children, or those who are in low-paid jobs. There are two types of tax credit: the working tax credit and the child tax credit.

What are they for?

To redistribute income to those less able to get by, or to provide for their children, on what they earn.

Are they similar to tax relief?

No. They don’t have much to do with tax. They’re more of a welfare thing. You don’t need to be a taxpayer to receive tax credits. It’s just that, unlike other benefits, they are based on the tax year and paid via the tax office.

Who is eligible?

Anyone aged over 16 (for child tax credits) and over 25 (for working tax credits) who normally lives in the UK can apply for them, depending on their income, the hours they work, whether they have a disability, and whether they pay for childcare.

What are their circumstances?

The more you earn, the less you are likely to receive. Single claimants must work at least 16 hours a week. Let’s take a full-time worker: if you work at least 30 hours a week, you are generally eligible for working tax credits if you earn less than £13,253 a year (if you’re single and don’t have children), or less than £18,023 (jointly as part of a couple without children but working at least 30 hours a week).

And for families?

A family with children and an income below about £32,200 can claim child tax credit. It used to be that the more children you have, the more you are eligible to receive – but George Osborne in his most recent Budget has limited child tax credit to two children.

How much money do you receive?

Again, this depends on your circumstances. The basic payment for a single claimant, or a joint claim by a couple, of working tax credits is £1,940 for the tax year. You can then receive extra, depending on your circumstances. For example, single parents can receive up to an additional £2,010, on top of the basic £1,940 payment; people who work more than 30 hours a week can receive up to an extra £810; and disabled workers up to £2,970. The average award of tax credit is £6,340 per year. Child tax credit claimants get £545 per year as a flat payment, plus £2,780 per child.

How many people claim tax credits?

About 4.5m people – the vast majority of these people (around 4m) have children.

How much does it cost the taxpayer?

The estimation is that they will cost the government £30bn in April 2015/16. That’s around 14 per cent of the £220bn welfare budget, which the Tories have pledged to cut by £12bn.

Who introduced this system?

New Labour. Gordon Brown, when he was Chancellor, developed tax credits in his first term. The system as we know it was established in April 2003.

Why did they do this?

To lift working people out of poverty, and to remove the disincentives to work believed to have been inculcated by welfare. The tax credit system made it more attractive for people depending on benefits to work, and gave those in low-paid jobs a helping hand.

Did it work?

Yes. Tax credits’ biggest achievement was lifting a record number of children out of poverty since the war. The proportion of children living below the poverty line fell from 35 per cent in 1998/9 to 19 per cent in 2012/13.

So what’s the problem?

Well, it’s a bit of a weird system in that it lets companies pay wages that are too low to live on without the state supplementing them. Many also criticise tax credits for allowing the minimum wage – also brought in by New Labour – to stagnate (ie. not keep up with the rate of inflation). David Cameron has called the system of taxing low earners and then handing them some money back via tax credits a “ridiculous merry-go-round”.

Then it’s a good thing to scrap them?

It would be fine if all those low earners and families struggling to get by would be given support in place of tax credits – a living wage, for example.

And that’s why the Tories are introducing a living wage...

That’s what they call it. But it’s not. The Chancellor announced in his most recent Budget a new minimum wage of £7.20 an hour for over-25s, rising to £9 by 2020. He called this the “national living wage” – it’s not, because the current living wage (which is calculated by the Living Wage Foundation, and currently non-compulsory) is already £9.15 in London and £7.85 in the rest of the country.

Will people be better off?

No. Quite the reverse. The IFS has said this slightly higher national minimum wage will not compensate working families who will be subjected to tax credit cuts; it is arithmetically impossible. The IFS director, Paul Johnson, commented: “Unequivocally, tax credit recipients in work will be made worse off by the measures in the Budget on average.” It has been calculated that 3.2m low-paid workers will have their pay packets cut by an average of £1,350 a year.

Could the government change its policy to avoid this?

The Prime Minister and his frontbenchers have been pretty stubborn about pushing on with the plan. In spite of criticism from all angles – the IFS, campaigners, Labour, The Sun – Cameron has ruled out a review of the policy in the Autumn Statement, which is on 25 November. But there is an alternative. The chair of parliament’s Work & Pensions Select Committee and Labour MP Frank Field has proposed what he calls a “cost neutral” tweak to the tax credit cuts.

How would this alternative work?

Currently, if your income is less than £6,420, you will receive the maximum amount of tax credits. That threshold is called the gross income threshold. Field wants to introduce a second gross income threshold of £13,100 (what you earn if you work 35 hours a week on minimum wage). Those earning a salary between those two thresholds would have their tax credits reduced at a slower rate on whatever they earn above £6,420 up to £13,100. The percentage of what you earn above the basic threshold that is deducted from your tax credits is called the taper rate, and it is currently at 41 per cent. In contrast to this plan, the Tories want to halve the income threshold to £3,850 a year and increase the taper rate to 48 per cent once you hit that threshold, which basically means you lose more tax credits, faster, the more you earn.

When will the tax credit cuts come in?

They will be imposed from April next year, barring a u-turn.

Anoosh Chakelian is deputy web editor at the New Statesman.