Agenda item

Colin Barrett / Simon Bowers

RESOLVED:

That Schools Forum noted the report and requested an opportunity for further discussion of the issues raised at the meeting in July or October 2022.

At the Chair’s request Schools Forum agreed to change the order of business to bring forward this agenda item.

BB explained that there had recently been changes to PFI.  Bills had been sent out to schools which had resulted in many queries.  Colin Barrett, Strategic Estates Manager, had therefore been invited to update Schools Forum on the changes.

CB explained that when entering into the PFI contract it had been acknowledged by schools and the Council that existing FM charges would be insufficient to meet new costs due to the existing condition of schools and years of reallocation of budgets for other uses.  FM charges would also include payment of lifecycle replacement for which schools had previously received separate funding.  To meet the actual costs of schools FM charges it had been agreed to support this with DSG and council generated revenue.  In 2005 the value of school FM charges had been calculated as a percentage of the overall FM charge.  Subsequently some schools had been extended or had new primaries built which had altered the percentage weighting of FM charges.  Schools have had this additional cost of FM met by additional DSG contributions.

The schools FM charges have been set based on predictive inflationary rates.  In most years actual inflation has been more than predicted, creating an additional in-year pressure on WNC general revenue.

A five-yearly benchmarking review took place in 2021/22 in which the contractor put forward a claim for an increase of £1.1m.  External advice supported this claim, but the council was able to negotiate a commercial settlement of £380k.  This cost would have been charged to the schools but due to council diligence in pursuing performance deductions, the value of those deductions was used to offset much of the 2021/22 charge.  The addition of the £380k to the base became the 2021/22 revised FM charges.

Schools have had their budgets inflated by the predictive inflation set in November at 7.23%.  It was proposed to charge schools the difference of 1.11%. 

DY asked whether in future it would be possible to have the report ahead of the meeting to allow time for review and bringing together questions from colleagues.  It was explained that this report was prepared in response to questions received in the days before the meeting, so advanced publication had not been possible.  However, it was agreed that any questions on this topic could be addressed at a subsequent meeting.

DY questioned the timeframe of the cost increases to schools.  Schools were only made aware of the increases last week and they would have a significant impact on budgets, which had already been set. 

CB explained that he had been in conversation with the ESFA to try to mitigate the costs and had successfully negotiated from £1.1m down to £380k.

DY advised that he had a responsibility to convey the thoughts of colleagues.  He accepted the reduction and acknowledged the work but stated that schools would not be able to meet all their educational needs due to costs.  This would have a significant impact on schools.  He asked whether the changes could have been implemented over time. CK noted that £350k had been put in by the council and proposed that forthcoming years were looked at to see if anything could be done.

PW asked how much money had been clawed back due to non-performance on the contract.  CB advised that the premise should be that the contractor was performing well and no money was clawed back.

PF asked how the FM service was monitored to ensure a gold standard service.  CB advised that when the contract was first initiated the level of performance was quite low.  WNC had increased resourcing to 2 people to inspect schools.  WNC had a higher level of service resource to provide schools with the confidence that it was being managed properly.

RESOLVED:

That Schools Forum noted the report and requested an opportunity for further discussion of the issues raised at the meeting in July or October 2022.