PFI contract means schools will pay thousands of dollars in grass cutting costs

Schools are spending tens of thousands of pounds more each year to meet rising costs of contracts with private companies.

These Private Finance Initiative (PFI) schools are locked into 25-30 year contracts and have higher fees than other schools.

One school said it was spending thousands of pounds a year to keep the grass on its playing fields below 2.5 centimeters (1 inch), as required by “rigorous” contracts.

PFI investors argue that the deal will create long-term value for taxpayers.

Middlefield Primary School in Speke, Liverpool, has opened after the local authority awarded a PFI contract for a new school building.

Principal David Potter said nearly 20 per cent of the school's overall budget was currently being spent on meeting the terms of the PFI contract, limiting the amount available for classroom staff.

The school has to pay a PFI company for day-to-day maintenance, feeding and cleaning, costing it more than £470,000 this year, an increase of more than £151,000 from 2021.

And one of the many “strict” details, Potter said, is that the grass must not grow more than an inch, even in the winter when the field is rarely used.

“Every week, rain or shine, our grounds maintenance team comes out and clears this field,” he says.

“We should have the freedom to say that we actually think we can do without.”

Maintaining the school grounds costs around £30,000 a year.

The contract does not allow the school's principal to shop around for better prices from other suppliers, but Mr Potter said he was “incredibly frustrated” to see prices rise. I feel that there is.

These costs have forced him to save elsewhere. The four classroom staff members have not been replaced since 2020.

The PFI company said it may renegotiate the contract to allow the grass to grow higher, but Liverpool City Council said the legal costs would outweigh the benefits.

More than 900 schools in England were built through PFI contracts until the scheme was scrapped in 2018.

Launched by the Conservative government in the 1990s and used by Labor and Conservative leaders to build schools and hospitals, the system allows private companies to retain ownership and responsibility for maintenance until the debt is repaid with taxpayer funds. I will do it.

As a result, principals end up using the same company and are unable to shop based on price. Potter said he feels “incredibly frustrated” as he watches prices rise.

PFI costs increase with the retail price index. The Retail Price Index is a generally higher measure of inflation that is no longer used as an official government measure.

Ten other PFI primary schools in Liverpool provided figures showing similar price increases to Middlefield.

Costs are also rising for Glyn Potts, principal of Newman RC College in Oldham, a large secondary school that opened in 2012.

But his biggest concern is the condition of the building. It has been plagued by roof problems since students moved in, with hundreds of thousands of pounds being held back from payments to private contractors.

In 2021, children were sent home after problems with the heating system caused radiator pipes to burst, gushing out “red-hot” water and repeatedly flooding classrooms.

“When a radiator bursts in a school, a torrent of water arcs three to four feet high,” Potts said.

Bursting radiators could leave up to 60% of the school unusable.

In order to have the heating system replaced, Potts had to ask the city council to sit down with the contractor.

Speaking to the BBC, he said with his head in his hands: “I have to go to my parents and say they are doing the best they can without any repercussions.

“You feel like a failure.”

When we visited the university, a classroom ceiling collapsed as a maintenance contractor tried to repair the heating on the upper floor, causing water to gush from the classroom roof.

Large plastic tubes are visible in the ceiling spaces around the school hallways to collect roof leaks.

Other head teachers in England said they were advised not to speak publicly about the pressures PFI costs were causing because of confidentiality agreements built into their contracts.

Last week, Stoke-on-Trent City Council met behind closed doors with the city's 88 PFI schools and was warned that PFI costs could increase by “double-digit” percentages within weeks.

Stoke's PFI contract, which includes the largest number of schools, will be one of the first to end in October 2025.

The BBC viewed recordings of the meeting and spoke to those who attended, although the public was excluded.

Meg Hillier, chair of the Parliamentary Public Accounts Committee, which investigates the cost-effectiveness of taxes, told the BBC that the secrecy surrounding these contracts was “absurd” and “unacceptable”.

“If it were more open, the coverage would shock a lot of people and taxpayers, and companies might think twice and not squeeze every last penny out of the school system,” she says.

The Ministry of Education has announced that support for schools under PFI contracts will increase by 10.4% next year.

Sir John Hutton, on behalf of PFI investors, said that although price comparisons were carried out regularly, school budgets had not kept pace with inflation over the life of the PFI contract.

He said the contract “reflects value for money for taxpayers” and “ensures schools are getting value for money in terms of cleaning, school lunches and everything else.”

Additional journalism by Rob Cave.

You can hear more about this story Monday at 8 p.m. huge PFI debt on BBC Radio 4 and BBC Sounds.