New school terms

The Government is throwing all its funding for secondary school projects, both PFI and traditional, into one big pot. Small and medium-sized firms have two choices: get subcontracting for the big boys or get out of education.

Called 'Building Schools for the Future' (BSF), it will be worth up to £45bn over the next 15 years. The dual goals are to build schools that improve children's ability to learn and to get greater efficiency. The proposed solution is strategic partnerships between local education authorities and the private sector. It will be the major contractors, in consortium with FM specialists, banks, ICT specialists and educationalists, who form these partnerships.

Don't be surprised if you haven't heard about BSF. The details are still being worked out. Many are frustrated about this. At a conference in November there were grumbles from the 300-strong crowd which expected the body in charge of BSF, Partnerships for Schools (PfS), to spell out what would be involved.

PfS chief executive Robert Osborne is scathing of this attitude. "We are demanding more sophistication from the marketplace," he told CM in an exclusive interview. "Companies looking for a prescribed structure will be disappointed." It won't be 'one size fits all' because different authorities will have differing expertise. Osborne holds up NHS LIFT as an example of the new structures and ideas that can emerge from the private sector.

The bigger boys
The PFI players are already on the case. "A lot of the big firms are coming to me and signalling to me how they are going to change themselves," said Osborne, who has worked in PFI for firms including Amey and Carillion PFI. What can regional contractors do? Osborne advises that they approach the major players – Jarvis, Balfour Beatty, Kier, for example – with ideas about how they might form long-term relationships.

Later this month the Department for Education and Skills (DfES) is due to name between 10 and 20 local authorities to form the first tranche of Local Education Partnerships (LEPs). The successful ones will share in a whopping £2.2bn for 2005/06.

When they go out to tender, the chosen LEAs will be looking for a strategic partner to deliver schools, some traditional, some PFI. The partnerships will last up to seven years.

There will be some money outside BSF for 'urgent building needs' - £3bn in 2005/06 to be shared between the remainder of England's 150 LEAs - but the substantial stuff will be coming through BSF.

Testing the water
Pilots (or 'pathfinders' in New Labour speak) to test different models for the LEP were launched in September 2003, with an annoucement on how £290m of funding will be divided expected soon. The four pathfinders – Greenwich, Sheffield, Bradford, Bristol - will advertise for partners in OJEC in the Spring, with the first schools planned to open in September 2006.

Behind closed doors, there is much frustration from private and public sector players about this new programme. The PFI market is now stable and working efficiently. Many councils are starting to get to grips with partnering. Why change now?

The political line is that the new arrangements will lead to better standards of education. BSF should also bring greater efficiency through private sector innovation and cross-authority benchmarking. PfS plans to standardise procedures to provide a toolbox for LEPs to draw on.

But then you have to add in the tangled layers of politics and bureaucracy, both locally and nationally. One senior person at a PFI-savvy LEA expressed concern that BSF would just prevent anything happening for a few years while everybody gets up to speed. Already the programme has slipped two or three months. The government wants to get going before the 2005 election. But what will happen after that?