ppp header

North Lanarkshire Schools Project

Category: Schools

I think there's a will on both sides to get the job done and to work towards a solution which is satisfactory to everyone whilst knowing that the contract lies in the background.

Murdo MacIver, North Lanarkshire Council’s Head of Educational Resources

September, 2009

The £170m North Lanarkshire Schools PFI Project involves the construction and maintenance of 24 brand new schools and community facilities on 17 sites throughout North Lanarkshire. The PFI contractor is a consortium comprising Balfour Beatty Capital and Innisfree Ltd. The project, which became fully operational in October 2008, was awarded European Education deal of the year in 2005 by Project Finance Magazine and PPP/PFI of the Year in 2006 at the Scottish Business Insider Deals and Dealmakers awards. Also it was the first project to use a public bond issue to finance an education PFI project in the UK. The project forms part of North Lanarkshire Council's Education 2010 PPP project to upgrade the entire school estate. 

The PPP Forum met Murdo MacIver (North Lanarkshire Council's Head of Educational Resources), Chris Flanigan (PPP Contracts Manager) and Sam Scott (Contracts Support Officer) and asked them about their thoughts on the project.

How did the construction process go?

Balfour Beatty, the construction contractor, has done very well. The schools have generally been delivered to specification, within price and on time. There have been snagging issues but there is generally a high level of satisfaction from the Headteachers and the elected members of North Lanarkshire Council.

What are the main differences with what you had before?

The facilities are significantly better with a wider range of community facilities available. This said, the key issue is whether the pupils perform better in the new schools, whether it be in terms of attendance or performance in national examinations and whether community use increases. If they don't then the investment won't have been worthwhile. As our new schools have only been operating for a relatively short period of time, it's too early yet to make any firm conclusions on this, however there's anecdotal evidence of improvement although nothing that could yet be rigorously backed up. 

How is the operating stage going?

It's early days but Balfour Beatty Workplace (the FM contractor) is doing a very good job and usually resolves issues quickly and I think that this view would generally be mirrored by the Headteachers. 

We have a good relationship with the contractor and have a pragmatic approach to the way we manage the contract. I think there's a will on both sides to get the job done and to work towards a solution which is satisfactory to everyone whilst knowing that the contract lies in the background. We look to resolve issues on the back of agreement rather than on the back of contractual disagreement or obligations.  We don't want a situation where we are constantly referring to the contract, chasing down penalties and going to legal resolution. The approach we take involves give and take on both sides which we believe has benefitted the project as a whole. 

One area of dissatisfaction amongst teachers is that many would have preferred closed classrooms rather than the open-plan design provided. This said, this was part of our specification and is not the fault of the PFI contractor.

What do you say about PFI when people ask you?

I think many of the problems highlighted in the press about PFI have been ultimately caused by Authorities getting the specification wrong or not negotiating hard enough. It's absolutely essential that Authorities go into the PFI process with the right specification and with their eyes open.

What advice would you give to someone in your shoes embarking on the PFI process?

I would recommend them to work hard to get the specification right: they should give careful consideration about future needs, whether it be size of rooms, services or community use and also about adaptability. As regards the contract, I would advise them to try and get it right first time and to negotiate hard. 

Going forward I would advise them to know their contract well, be absolutely sure about their responsibilities and entitlements, but pay even more attention to relationships.