Pinsent Masons calls for clarity on schools review
THE Government’s decision to halt the Building Schools for the Future (BSF) programme has created a mire of legal and contractual uncertainties for all parties involved in the development, construction and running of new schools, law firm Pinsent Masons has said.
The Department for Education (DfE) said it wanted to set out a clear way forward for prudent capital investment in education.
However, the law firm said that in the short-term, local authorities and bidders alike had been left with a string of unanswered questions.
In total, the DfE has identified more than 1,400 schools, in 140 different localities. These schools have been categorised as ‘stopped’, ‘unaffected’ or ‘subject to review’.
In the case of ‘stopped’ schools, both local authorities and private sector companies will have been at the point of submitting bids or signing contracts and Pinsent Masons said many would be wanting to know how, when and whether the costs which have been wasted in preparing the bids could be recovered.
In addition, stakeholders would want to know that if schemes are to be scrapped then what will happen to the work that has been prepared.
Companies involved in the supply chain will also want to know where they stand, said the law firm, especially if they had committed additional resources in anticipation of business.
“The [Government’s] decision will put the future of many of these employees and even the organisations themselves in doubt. It will be a paradox if claims of costs savings are swamped by abortive development money, claims and litigation,” said Pinsent Masons.
£370m schools programme given green light
Where schools are labelled ‘unaffected’, the law firm said there was still some uncertainty about how the BSF projects would progress. It has also sought clarification on which body will retain responsibility for these schools at the local level.
A cornerstone of the BSF programme was the creation of a private/public joint venture, the local education partnership (LEP). It was the LEP’s role to map out the development of future schemes.
“If these future schools are ‘unaffected’, can those involved in the LEP be confident that they will retain responsibility for the development of those schools? Does the DfE’s announcement mean that the timing for availability and funding in respect of these schools will have to change,” said the firm.
Similarly, the role of the LEP in the Subject to Change category also needed clarification, it said.
“The DfE suggests these will be determined ‘in recognition of local need’ – however, it would appear that the majority of these schools are those which are at ‘preferred bidder’ stage – that is to say: a local need has already been clearly identified by the local authority and a private sector partner has been selected to form a LEP.
“As with the ‘stopped’ schools, this process will have involved many months of expensive competitive tendering. Both private sector partner and local authority properly expected that they would imminently be entering into contracts. If the suggestion now is that the private sector partner is only going to be entitled to develop one or two schools, as opposed to a number of schools, important questions of procurement law will need to be addressed – not least, the disproportionate cost that the local authority and private sector bidder will have been required to incur relative to the number of schools which it will finally be entitled to develop after completion of the review,” said Pinsent Masons.
It said the impact of the Government’s announcement on all those involved in the BSF programme over the last few years could not be underestimated.
“While there has been a general consensus in positive comments about the need to remove the red-tape and box-ticking of BSF, a vacuum has been created in its place,” it said.
