In a wide-ranging speech to the Lord Mayor's banquet in London, the Prime Minister will argue that industrial competitiveness depends on a return to traditional values in the classroom.
This message will be hammered home in further speeches by senior Cabinet ministers to the CBI conference in Harrogate this week. But John Patten, the Secretary of State for Education, last night ruled out a big expansion in nursery education - which Labour argues could help stem social problems - saying the country could not afford it.
A call for nearly all children to get nursery education from the age of three will come tomorrow from the National Commission on Education, a private version of a royal commission set up by Sir Claus Moser. But Mr Patten said: 'We haven't got any money. We are in a difficult public expenditure round.
'If we wish to see a massive and sudden expansion in nursery education then we would have to divert money from elsewhere in the education budget or elsewhere in government spending.'
Sir Claus is a distinguished statistician and former Warden of Wadham College, Oxford. His commission will tomorrow call for an extra pounds 1bn a year to be pumped into the education system to prevent the development of an underclass in the inner cities.
Britain is becoming a 'knowledge society', its report will say, and the price of not educating all young people to a high level will be the creation of a dispossessed group which cannot make a useful contribution. The commission will also propose abolition of A-levels in favour of a Continental-style, broader-based yet 'rigorous' exam which will encompass several subjects. The Government favours keeping A-levels as the 'gold standard' of British education and Mr Patten announced a new 'starred grade' for the exam higher than the present top grade, to reward outstanding pupils.
Downing Street sources made it clear that the Government's back-to-basics drive, contrary to Sir Claus's intentions, is designed to cut public spending, not increase it. Single mothers, for example, may find it vastly more difficult in future to gain access to council housing, and could face a cut in benefits. Officials say ministers want to see 'economic and social policy working together'.
Mr Patten's haste to reject the Moser Report was condemned by opposition parties. The Shadow Education Secretary, Ann Taylor, said: 'If resources went into nursery education then we would have a healthier education system, but we would also be able to deal with the social problems that arise later.
'The evidence shows that if we spend money on nursery education children will settle into school and perform better all through their school life. They are also more likely to get jobs, less likely to turn to crime and there are many social benefits to society as a whole,' she said.
Ministers will also this week attack truancy, using the publication for the first time, of figures expected to show that a third of all schoolchildren play truant at some time.
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