Decision details

RESOLVED: That Cabinet:

1.    Approved a capital budget of £1.100m to undertake essential asset replacement works to the Northampton PFI Schools.

2.    Authorised the procurement of these works.

REASONS RESOLVED:

1.    The assets to be replaced do not comply with the School Premises Regulations 2012 and their condition posed a health and safety risk to students, visitors, and staff to the premises.

2.    The Council has an obligation to meet the Regulations in the schools as a result of the PFI arrangements, which includes contracts with each school governing body or academy trust.

3.    Replacing these assets would result in the responsibility for them transferring back to the PFI contractor, thus managing the Council’s liabilities.

ALTERNATIVE OPTIONS:

A.   Do nothing: It is highly likely that individuals would suffer from harm. This could lead to action against the Council for breach of statutory duty and unlimited fines. Civil claims could be made. The Council would suffer reputational damage. Areas in schools would become unsafe to educate pupils in.

B.   Provide £1.1m of capital funding to replace the assets. This option would enable the Council to mitigate harm to persons and the likelihood of action for statutory breaches. It would protect the Council from reputational damage. It would provide pupils, staff, and visitors with safer schools to attend. Replacement lighting would assist schools in mitigating utility cost increases.

C.   Replace the assets prior to contract expiry: this would enable the Council to defer the cost of replacement although the costs of replacement would be higher as inflation increases. In the intervening period the Council would still be at risk of action for breach of statutory duty and unlimited fines. Civil claims could be made. The Council could suffer reputational damage. Areas in schools would become unsafe to educate pupils in.

D.   The Council could seek to vary the contract to request that the contractor fund and replace and maintain the assets: This option would enable the Council to reduce the cost of its own borrowing but would require it to meet the additional revenue UC costs. The Council’s borrowing rate is lower than that which the contractor would charge. Replacement lighting would assist schools in mitigating utility cost increases.

Option B is the most cost-effective option that enables the Council to mitigate harm to persons and the likelihood of action for statutory breaches. It would protect the Council from reputational damage and provide pupils, staff, and visitors with safer schools to attend.