Credit crunch stymies new school IT

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Plans to rebuild the UK’s secondary schools and supply them with new technology are being held up by the economy, a National Audit Office (NAO) report published today has found.

The report blamed a lack of private funding due to the credit crunch as the main reason why the Building Schools for the Future (BSF) programme had not met its targets.

The initiative to rebuild, refurbish and provide new IT for all 3,500 secondary schools in England by 2020 was launched in 2003 and is overseen by the current Department for Children, Schools and Families (DSCF). The first such school, Bristol Brunel Academy, opened its doors in September 2007.

The DSCF pledged to raise £45 billion through private finance initiatives (PFIs), of which 10 per cent was to be allocated to new technology. But the NAO said local authorities have found it increasingly hard to source credit in support of BSF PFI deals.

The NAO reported that as of December 2008 only 42 of the planned 200 schools had been built. In order to reach its original goals, the number of schools in procurement and construction at any one time will need to double from 2011 onwards, the report added.

“The extent to which problems in the finance markets will affect BSF is still unclear,” the report said.

It did point to the commitment in principle from the European Investment Bank to provide £300 million of investment, as secured by the agency running the BSF programme, the Partnerships for Schools (PfS).

"The DCSF and PfS are in active discussion with banks and other potential lenders and believe that BSF remains one of the more attractive markets for bidders,” added the NAO in the report.

Despite such assurances, the NAO also criticised the DSCF and PfS as being “overly optimistic” in their projections for the delivery of the first schools to feature cutting-edge operational and educational technology.

It also said construction contractors outnumbered their IT counterparts and that new consortiums tended to only approach previously successful BSF IT contractors.

Despite the criticisms, chief auditor Tim Burr said programme's management has been improved. “But it remains a real challenge, in difficult market conditions, to deliver the 250 schools a year that will be needed, to include all schools by 2020 as currently planned," he added.

While broadly welcoming the report, schools minister Jim Knight said: “We are confident that BSF was the last sector to be affected by the economic downturn but is well placed to be the first to come out.”

Click here to see what the schools of the future could look like - if we can afford to build them.

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