The Treasury and the Department for Education are in talks over how to ensure lessons from the ongoing PFI review can be built into the £2 billion Priority Schools Building Programme - which is now feared to be running six months behind schedule.
Sources close to the discussions have told Construction News that delays to procurement of the programme may now run until September - a claim the Department for Education is dismissing.
A source said: “The delay is partly due to the assessment process, the number of applicants and the rigour being used to determine the funding priorities. The funding is there but they [the government] are more worried about the PFI vehicle and the political fallout of that.
“The big problem for the government is that if they don’t start this soon then they may not be able to reap the benefits, and that is a concern being expressed across the board.”
The Treasury’s “call for evidence” on PFI closed last month. At the time, the head of Infrastructure UK Geoffrey Spence told CN that contractors that back PFI need to make the case for it more publicly.
It is believed that a condition survey of the schools for which funding is being sought by local authorities is ongoing but due to be completed this month.
After that, the government will have to review the applications before it can settle the allocation of funding, leaving contractors still unsure as to when work will come to the market.
Partnerships for Schools interim chief executive Ruth Thompson moved to quell contractors’ concerns when she spoke at a British Council for School Environments private members’ meeting last week.
Contractors that attended the meeting complained they are allocating resources to bidding teams and have employees with education skills on standby, only to be met by increasing delays.
BCSE chief executive Nusrat Faizulla told CN that she backed the work being done through the condition survey, but warned that clarity on the timeline for PSBP was needed before companies start walking away from the sector.
“The condition survey was really needed to make sure that we have evidence-based policy, it’s the best way to show where funding is needed and how to get it and to make sure there are long-term solutions put in place,” she said.
“Some people are wondering if [the programme] is actually going to happen; there’s a bit of paranoia out there at the moment, but we don’t understand the condition of our schools and it’s important that this survey happens and we make sure and get the PSBP right.”
The DfE would not confirm the total number of applicants for funding, but competition between local authorities is expected to be fierce, with sources close to the talks warning there will be “a ‘standing still period’, while the department looks at the political liabilities of who gets funding and who doesn’t”.
A second source said: “All local authorities who were on the edge of BSF funding will be lining up for this. A lot of them will be thinking this could be our last pot of money for five years so we need to make it count.”
Shadow education secretary Stephen Twigg said the PSBP appeared to be “in chaos” and described reports that funding announcements would be further delayed as “another blow to the construction industry”.
A DfE spokesperson said it was “totally false” to say the announcement had been delayed by “another six months”.
The department was originally due to report back on funding in December. CN revealed the date had been put back due to the volume of bids for a slice of the £2bn funding.
A DfE spokesperson said: “PfS are currently reviewing applications to the PSBP to ensure there is a fair and rigorous selection of schools.
“Until all applications have been fully assessed we are not able to announce which schools will be in the programme. It is incredibly important that this process is done properly.”
The Building Research Establishment has supplied the DfE with an evidence paper on the performance of eight schools as the department finalises its decision on whether to scrap mandating the environmental assessment on new schools.
The schools, which are from different regions and have been monitored since they were built, will help the DfE decide whether it will move away from the requirement that all new schools are BREEAM-rated Very Good.
BRE director Martin Townsend told CN he was “hopeful” that the DfE will continue to use BREEAM.
“If they feel there are elements that aren’t working within BREEAM then we are more than happy to sit around the table and say: ‘OK, what do we need to change?’ If there are further improvements to be made on schools all they have to do is pick up the phone,” he said.
Mr Townsend said BRE was keen to have discussions with local authorities, which can continue to require BREEAM for new schools regardless of education secretary Michael Gove’s final decision.
Discussions between the DfE and BRE have been taking place “once or twice a week for months” on the issue with three separate papers submitted by BRE to try and showcase the benefits of applying the environmental standard to schools.
BRE submitted an outline paper, revealed by CN last month, demonstrating the benefits of BREEAM. It also submitted a question and answer document and the evidence of schools’ performance as part of its discussions.
A DfE spokesperson said that a response to the recommendations from the James Review, including on BREEAM, would be made “very soon”.