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News feature: Did PFI cause Edinburgh’s school failures?

Firrhill High
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The closure of 17 PFI-built Edinburgh schools on safety grounds has raised serious concerns as to whether the funding method has created a generation of poorly designed and built schools. Colin Marrs investigates

For the past month, 8,000 pupils in Edinburgh have been forced to travel, for miles in some cases, to classrooms in unfamiliar school buildings. On 29 January, winds of up to 90 miles per hour, ripped down a large section of an external wall at the city’s Oxgangs Primary School (pictured opposite, bottom right). Two months later, an inspection prompted the closure of all 17 schools built under the same Private Finance Initiative (PFI) deal signed by Edinburgh City Council in 2001, and worth £540 million over 30 years.

At the time of writing, full survey results have not been compiled, but the private consortium running the contract, Edinburgh Schools Partnership (ESP), says it has discovered missing header ties in two buildings  – including Oxgangs.

ESP is owned by HBOS and includes construction firm Galliford Try, after the latter acquired original partner Miller Construction two years ago. It has blamed the ‘unacceptable’ standard of construction carried out by the building contractor. A spokesperson for Edinburgh City Council confirmed that all the schools had been design-reviewed but refused to provide the reviews in question.

The Edinburgh incident has provoked a wider debate about the role of PFI contracts. A number of prominent Scottish architects claim the procurement model incentivises dangerous cost-cutting, affecting not just the construction of buildings but also their design.

So, do these claims that PFI produces buildings unfit for purpose stand up to close scrutiny? And is there something about the structure of this type of contract that pushes design considerations to the margins?

Oxgangs primary

Oxgangs primary

Source: Keith Hunter

Oxgangs primary was the first Edinburgh school to show problems

PFI sees new infrastructure funded, designed, built and maintained by a private-sector consortium, which receives monthly payments from a public sector client over the duration of the contract – generally between 25 and 30 years. Initiated by John Major’s government in 1992, PFI burgeoned under New Labour. Its major attraction was an ability to fund new schools and hospitals without an up-front cost, meaning the cost of the projects did not count towards the national debt. ‘PFI is a racket,’ says Malcolm Fraser, director at Scottish architecture and planning consultancy Halliday Fraser Munro. In 2007, Fraser resigned as deputy chairman of Architecture and Design Scotland (A&DS), believing the contract model was ‘blighting’ schoolchildren’s lives.

‘In general terms it is a process set up to be led by big corporates and their bankers and lawyers to channel enormous amounts of public money into the private sector,’ he says. ‘It demonstrates the UK’s institutionalised contempt of making things, in favour of focusing on financial services.’

Glasgow-based architect Alan Dunlop – who has railed against PFI for more than a decade – says the process is flawed because the architects involved are employed by the contractor rather than the client. ‘This means that they don’t have responsibility to inspect the construction work and make sure it is carried out to their designs,’ he says.

The relationship also means architects are deterred for from blowing the whistle on cost-cutting, according to Neil Baxter, secretary of the Royal Incorporation of Architects in Scotland (RIAS). ‘The contractor wants to maximise profit – and that is not always going to be in the best interest of the client or society,’ he says.

Under PFI architects don’t have responsibility to inspect the construction work and make sure it is carried out to their designs

One architect involved in PFI schemes says: ‘The contractor pays your fees. If they want something really quickly or want to alter the specs, you are on a hiding to nothing. If you kick up a fuss they can do things like delaying payments to you.’

In addition to design, PFI contracts hand the contractor responsibility for capital raising, facilities management, maintenance, furniture and IT.

Former RIBA president Sunand Prasad, senior partner of Penoyre & Prasad, says: ‘Because the contractor became a one-stop shop for all the services, design had to fight against other pressures on costs arising from those other areas. Why should you balance one against another?’

At the end of a PFI contract, the contractor hands over the building to its public-sector client. Baxter argues that this means the private-sector partner is only interested in making its buildings usable up to this point. ‘It is in their interest only to last for the term of the repayments,’ he says. ‘If the Victorians were building a school, they would build it to last 100 years. That is not built into PFI – it encourages cheap, quick buildings that are only just good enough.’

Firrhill High, Edinburgh

Firrhill High, Edinburgh

Source: Keith Hunter

Firrhill High, Edinburgh

No data is available on the level of fees paid to architects on PFI projects, although there are stories of architects in Scotland being offered as little as 1.5 per cent of construction costs. Baxter says: ‘Anecdotally it is less and sometimes less to the point of being ludicrous. If you squeeze fees, you reduce the amount of time people can spend on a project. You don’t allow the level of thinking time that would usually be devoted to a project.’

Others, however, report satisfaction with fee levels. Paul Monaghan, partner at London-based AHMM, says: ‘We have always found the fees to be OK for PFI, but we work for good people – they know that if they don’t pay then they won’t get a quality result.’

For all Baxter’s strong words, Dunlop complains that the RIAS has done too little on the issue of fees. ‘Instead of getting involved in the debate,’ he says, ‘the RIAS is diverting resources into the Festival of Architecture where you have architects’ golf tournaments and the like. They should be focusing on the serious issue of how architecture is orchestrated, and the real problem of low fees. I don’t think they realise how difficult it is to be an architect at the moment.’

Keeping tabs on how much involvement architects have had in PFI projects is often difficult owing to a lack of transparency. Design briefs – agreed between private firms within the consortiums – do not appear in the public domain.

The Victorians built schools to last 100 years; PFI encourages cheap, quick buildings that are only just good enough

‘The real difficulty here is nobody knows what these contracts are made up of and where the responsibilities for design and oversight lie,’ Dunlop says.

Problems with the design of early PFI buildings first emerged relatively soon after the programme began. A series of investigations by the Building Research Establishment (BRE) at the start of the century compared design quality between early PFI projects and those procured using more traditional methods.

Its first study – carried out in 2001 on behalf of the Audit Commission – found that the architectural quality of PFI schools was significantly worse than for traditional schools.

‘We were measuring not just aesthetic merit but also materials and issues like whether there was enough shelter from rain and sun,’ says Martin Cook, former head of design at BRE, now director of post-occupancy review consultancy DQM Solutions. ‘We could spot PFI schools at 1,000 yards – they all had aluminium cladding and crinkly tin roofs. The traditional schools were brick and tile and looked like they would last a lot longer.’

Cook reels off a list of faults that were found within schools: fire escape stairs that were too narrow, fire escape doors that swung the wrong way, head heights that were too low.

‘There was certainly a handful of building regulation contraventions in the PFI schools, even when they were deemed to have met the BRE’s overall acceptable standard,’ he says.

Pirniehall Primary School, Edinburgh

Pirniehall Primary School, Edinburgh

Source: Keith Hunter

Pirniehall Primary School, Edinburgh

Some question, however, whether such issues were down to the PFI contracts themselves, or whether blame lies with the way they were specified and managed by their public-sector clients. A 2004 study carried out by the University of Brighton’s School of the Environment construction research team attributed problems at four Brighton PFI schools – including poor sound insulation and corridor ceiling heights – to under-specification.

‘It is about how you set the contracts up,’ says Neil Painting, one of the academics who produced the study. ‘Contractors are wolves and will do the minimum they can to keep costs down within the parameters set by building regulations. At that stage, there wasn’t a lot of support for local authorities doing these deals. In one case, there was an item that just said “upgrade cloakrooms” which was far too loose to lead to a satisfactory outcome.’

If structured properly, PFI deals should protect the public partner from many problems caused by bad design or construction, according to Matthew Wolton, a lawyer specialising in education PFIs. ‘If these contracts are specified and managed correctly, they are designed to ensure the public sector is never out of pocket or place,’ he says. ‘If a building becomes unusable, then a penalty fee is due, enabling you to hire other premises to be able to carry on teaching as usual.’

Edinburgh City Council has already cited a clause in its contract to withhold its £1.5 million payment for April from ESP.

Wolton is dismissive of the idea that PFI contracts encourage cost-cutting any more than a straightforward public procurement tender. ‘Anyone looking to build something has to make a call on expense versus quality,’ he says. ‘There have always been stories of building projects going wrong. I bet if you studied it, the instances wouldn’t be any higher under PFI.’

AHMM’s Monaghan, whose PFI-procured Burntwood School won last year’s Stirling Prize, agrees. ‘If a builder makes savings by cutting finishes or bad workmanship, they are going to have to fix it. So it is a false economy for them to scrimp too much on design,’ he says.

But Roger Hawkins of Hawkins\Brown, which has been involved in a number of PFI school projects, disagrees. ‘Allegedly the facilities management was part of the package,’ he says. ‘But that was often divorced from the build package, meaning contractors were getting away with building very poor-quality schemes. It was short-term value. The contractor-led process, together with the pressure from the Treasury to save money, screwed over the sub-contractors and screwed over the design team. Schemes were dumbed down to the lowest common denominator.’

We could spot PFI schools at 1,000 yards – they all had aluminium cladding and crinkly tin roofs

In 2005, a report by the architecture watchdog CABE concluded that ‘in practice, virtuous feedback loops to inform design and specification were far from the norm in PFI projects’. The vast majority of PFI buildings procured to that point, it said, ‘have not been designed and built to a high enough standard, and public service delivery suffers as a result’. CABE blamed clients for giving too little weight to design and whole-life costs in the evaluation of best value.

The CABE report led to a Minimum Design Standard and compulsory design review being introduced for the PFI-dominated Building Schools for the Future (BSF) programme, which began in 2007. These initiatives, along with public-sector clients becoming stricter in their specifications, have led to great improvements in the design of PFI buildings, according to Mairi Johnson, global education sector leader at AECOM and former deputy director of design at the Education Funding Agency.

‘Once we knew what the problems were, we could specify what we wanted better,’ she says. ‘I feel like that issue has been dealt with.’

For his part, Prasad says that part of the reason for PFI’s poor reputation was down to the timing of its introduction. ‘The quality of school design was bad anyway in the early 2000s,’ he says. ‘There was a very long period between the early 1980s and late 1990s where the public sector hardly built anything. When a public estate construction programme was revived, PFI was the main vehicle for public-sector clients, who had little experience of procuring schools.’

PFI capital value of schools

PFI capital value of schools

Johnson also points to a sea-change in the way government procures schools following the government’s replacement of BSF with the Priority School Building Programme (PSBP). The new programme will use traditional methods of capital funding for 214 of the schools covered, with 46 delivered through a slimmed-down type of public private partnership (PPP).

‘They were extremely challenging deals to negotiate and there was so much information in the contracts that it was difficult for the client side to manage,’ she says. ‘Under the new PSBP model, all they have to do now is design and build the schools and do some maintenance.’

In Scotland, PFI was binned completely in 2008 after the SNP formed a minority government. A new body, the Scottish Futures Trust, was created to improve infrastructure investment. It has adopted a new ‘hub approach’ to PPP, with public-sector organisations working in partnership with each other and a private-sector delivery partner through a joint venture company. But not everyone is happy about the new arrangements. Fees for architects are capped, and one architect, who did not want to be named, says aggressive undercutting still takes place, which still runs the risk of undermining design quality.

Braidburn school, Edinburgh

Braidburn school, Edinburgh

Source: Keith Hunter

Braidburn school, Edinburgh

Given that roof ties cost a matter of pence, it is unlikely that PFI-linked cost-cutting played a direct part in the Edinburgh debacle. However, subservient to the contractors employing them, architects involved in these projects have less power to monitor construction and flag up corner-cutting than when employed directly by a public-sector client. The evolution of PFI procurement has undoubtedly led – albeit through a painful learning curve – to improvements in poor design standards that initially dogged the programme. Building collapses in the UK are – thankfully – extremely rare.

Yet it is sobering to think that the building defects discovered in Edinburgh have emerged in schools that are little more than decade old.

The fear is that this is not a one-off aberration but symptomatic of flaws with an entire procurement method. The survey of those 17 schools will be awaited with interest.

  • 1 Comment

Readers' comments (1)

  • Is a good, experienced, clerk of works / client representative who's permanently on watch for substandard workmanship or materials a 'thing of the past'?
    All the quality management and self certification in the world is so much hot air if it's just talk - in effect, fantasy, whether related to design or construction (including management of safety, environmental health and sustainability / environmental performance).
    I wonder whether there was fraudulent (sorry, 'faulty') 'box-ticking' in the case of signing off the completion (or even of the specification) of the Edinburgh schools?

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