Cost of school rebuilding programme soars

The costs of planning and setting up new schools have soared by 50% under the government’s rebuilding programme, with one council paying consultants £24m before a single building had even been constructed.

The massive rises in the cost of new privately financed schools – obtained under the Freedom of Information Act – have contributed to the bill for the government’s flagship school rebuilding programme spiralling from £45bn to £55bn.

A pledge made five years ago by ministers, to be fulfilled by 2020, promised the “biggest school-building programme for generations”. The Building Schools for the Future (BSF) scheme would see the rebuilding or refurbishing of almost every secondary school in England.

However, new research reveals that authorities in the later stages of the scheme have seen costs rise by an average of 50% just to set up a school building deal. The costs include spending on outside consultants to develop building plans and draw up contracts before any deal is signed with a construction firm.

The 31 councils surveyed had originally expected to spend £122m on setting up their schemes, covering the period from advertising it in the European Union’s official journal to reaching financial close with a private consortium. However, they now anticipate spending £161m, or 32% more. Half of all councils admitted that they had already seen costs rise, with councils more than 18 months into the programme expecting to spend £36m more than the £78m they first budgeted, an increase of 46%.

Haringey council in north London spent £23.8m – the cost of a new school and nearly four times the government’s recommended amount – on consultants before any schools had been built. A spokeswoman for the council said the figure was so high because it was accounting for its costs “upfront”, while other authorities “hid” them by spreading them out over a longer period.

Critics have long claimed that BSF is too complex and imposes unnecessary delays and costs on councils. The programme began in 2004 with the aim of rebuilding half of all secondary schools, remodeling just over a third and refurbishing the rest. But just 42 of the planned 200 schools were rebuilt in the first four years of the scheme, putting it three years behind schedule.

The research by the PPP Bulletin reveals the extent of councils’ problems and raises fresh concerns over BSF. Ty Goddard, head of the British Council for School Environments, said the figures were “an important contribution to the debate about how we can sharpen up the process of investing in our schools.

“In fragile economic times, it is vital that we match this present government’s commitment to schools capital with an honesty and frankness about how the money is invested and some of the big challenges on the ground,” he said.

A spokeswoman for Partnerships for Schools, the agency in charge of BSF, said it was “looking at the issue of capacity within local government” and continued to share best practice and lessons learned.

Written with Amelia Hill and first published in The Observer