The government should start directly financing much of its flagship £45 billion Building Schools for the Future (BSF) programme to avoid it being derailed by a shortage of private finance, warned architects and MPs this week.
More than 50 per cent of the initiative, which aims to rebuild or renew nearly every secondary school in England, is funded by private-sector investment. The Department for Children, Schools and Families (DCSF) select committee warned last week that BSF could be decimated ‘because the private sector may be far less willing to enter into PFI arrangements’ due to the economic slowdown.
Former RIBA president Jack Pringle called on the government to scrap the privately financed element and start directly funding the programme.
‘Deals are slowing down as consortia struggle to put their contracts together, and these further delays are unacceptable,’ said Pringle. ‘The government should directly finance the schools and just get on with it.’
Pringle was backed by Labour MP Barry Sheerman, chairman of the DCSF select committee, who said: ‘A lot of the funding decisions were made before the credit crunch and we are now in a very different world. Direct funding is a possibility that has got to be explored.’
BSF is currently under review by the Treasury, which is trying to identify ‘additional value for money’.
A Partnerships for Schools spokesperson admitted that the lack of private finance could lead to delays. She added: ‘These are very challenging times. Lending conditions in the PFI market in particular have tightened.
‘We are working extremely hard to manage the current challenges and minimise any delays. This includes securing a commitment in principle to support BSF schemes that have a PFI component from the European Investment Bank.’
Architects bidding for BSF projects admitted concern.
Bernard Doyle of Nightingale Associates said: ‘We are worrying about this quite a bit at the moment. Everyone is anticipating news of a big BSF project that falters because of a lack of finance.’
Feilden Clegg Bradley Studios partner Ian Taylor said: ‘It is an ambitious programme... I imagine it is going to be harder to raise the funds.’
David Gloster, RIBA head of education, added: ‘It’s worrying that something that was seen as providing a lifeline for practices with declining workloads looks under threat. Reduced funding will have a significantly detrimental impact on design quality.’