Falkirk Council: 'Substantial savings' expected when PPP schools come under council control
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Members of Falkirk Council’s education, children and young people executive heard on Tuesday that plans are progressing well to bring the five schools – Bo’ness, Braes, Graeme, Larbert and old Carrongrange – back into council ownership.
As Falkirk Council was the first in Scotland to use this type of private and public partnership to build new schools, it will also be the first to end the contract.
In June last year, the education executive agreed to allow the existing agreement with Class 98 Limited to expire on August 1, 2025, with the council taking back the management, operation, maintenance, and servicing of the schools. A project team has been overseeing the work for two years and independent companies have been surveying all five schools to ensure assets are in good condition.
This summer, a specialist external contractor will also be employed to undertake a full assessment of the condition of the kitchen equipment before it is handed over.
Members heard that despite the huge costs of running the schools, it was hoped there would be scope to save money.
The cost of the current contract is linked to inflation, which has meant the cost has risen by £1 million in the past year for things such as investment, repairs, cleaning, janitorial work and insurance.
Members heard there should also be savings through “economies of scale” as catering and cleaning processes would be standardised across all the council’s secondary schools.
The overall cost at the moment is £19.8 million, but the Scottish Government’s support of £8.6 million leaves an overall cost to the council of £11.2 million. That is the amount that will be available to fund the provision of the services currently provided by Class 98.
The money will also meet the cost of around 95 staff, from catering, cleaning, janitorial, site supervision and technical/asset management staff who will transfer under TUPE rules.
The report to the education executive told members that there is funding available in the current capital programme for this work.
Under the current contract, the “buy back” option requires the Council to pay the lesser of £5 million or the market value of the school sites. Councillors were told that it is highly unlikely the buildings will be valued at less than £5 million.
Members were also assured that some of the expected savings would be invested in other schools across Falkirk.
Councillor Iain Sinclair, the SNP’s education spokesperson said: “We should be aware that as we are the first council to have a model of this type and the first to come to the end of these contracts, all eyes are on Falkirk Council. While this comes with significant challenge, there’s also a real and tangible opportunity to lead the way.”