Falkirk Council: Schools could move back to council ownership if Class 98 deal ends

Five of Falkirk’s high schools are expected to start the move back into full council ownership next week, as contracts will come to an end 25 years after the schools were first built.

By Kirsty Paterson, Local Democracy Reporter
Wednesday, 15th June 2022, 4:45 pm

A meeting of the Education, Children and Young People executive next week will be asked to agree that the council should not extend the contract it has with Class 98 Limited.

If councillors agree, the meeting will authorise senior managers to “take all necessary administrative, technical and contractual steps to bring the contract to an end at August 1, 2025 and transfer the schools back to the council”.

Falkirk Council was the first council in Scotland to enter a PPP (Public Private Partnership) contract to renew some of its high schools, which means it will be the first to reach the expiry date.

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The contract was entered into by the council with Class 98 Limited in 1998 and the construction of the schools – Bo’ness Academy, Braes High School, Graeme High School, Larbert High School and the Old Carrongrange School – was completed by August 2000.

Under the contract, Class 98 Limited are responsible for the management, operation, maintenance, and servicing of the school facilities so that they are available for use by the council for education and community use.

The council has to decide by August 1 this year if wishes to allow the contract to expire on August 1, 2025. The alternative would be agreeing to extend the agreement with Class 98 Limited.

A report that will go to councillors at the education executive on Tuesday will suggest that the council should press ahead with ending the contract. All 96 FTE staff with Class 98 will transfer to the council through TUPE if this goes ahead.

The PPP funding model has proved controversial as the capital cost of building the five new schools was reportedly £65 million – while by the end of the contract’s term, Falkirk Council will have paid Class 98 £316.4 million.

The council will have to pay a final £5 million before it owns the buildings outright, and pay just over half of another £18 million that cover things such as repairs, cleaning, janitorial and insurance costs as well as rates utilities and catering.

This will also include costs associated with the transfer of the current staff under TUPE rules.