Agenda item

Ruth Bagley presented paper to the Schools Forum on PFI Funding.

3 recommendations were put to the Schools Forum as follows:

• The Forum expresses a view on how the immediate payment of the reserve of £500k should be distributed whether on the basis of the formula or in some other way.
• The Forum agrees to support a review of the overall PFI charge.
• The Forum participates in a consultation on the redistribution of the PFI funding gap to achieve a significant reduction to the figure of £810k on a phased basis.

Maggie Waller welcomed the return of the 13/14 funding to the DSG and suggested that it should be distributed to all schools through the formula as the funding for all schools for 14/15 had been top sliced.

Maggie Stacey suggested that it be used to fund retrospective funding for the Growth Fund in 13/14.  Jo Rockall noted that all schools have been top sliced already to provide £1.2 million to the 14/15 Growth Fund.

Helen Huntley asked about special schools and the PRUs if the money went out to all schools via the 5 – 16 formula and it was clarified that the Council’s funding for PFI (£300k approx.) is already in the High Needs Block and the £500k is separate. 

1^st Recommendation:

Forum agreed to vote on the first recommendation above.

• 8 members of the Forum in favour of the 500k being returned through the formula.
• 2 members of the Forum in favour of going through the Growth Fund for 13/14.

The decision was therefore to distribute the £500k to all schools via the 5 – 16 formula.

2^nd Recommendation:

It was noted that the total cost of the PFI charge is £2.3m with contributions from the DfE, the 3 PFI schools, the DSG (savings on out borough placements) and the Council’s agreement to closing the affordability gap with approximately £800k.

Ruth Bagley noted that there is pressure from Treasury to review PFI contracts and therefore there is government support. She also referred to renegotiations of contracts by other LAs and Jo Rockall asked how successful these had been.  This was not known. 

Schools Forum supported the recommendation that the Council review the contract with the PFI contractor with a view to renegotiating and reducing the overall cost.  It was noted that this would need the engagement of the 3 PFI schools. Debbie Richards and Kathleen Higgins noted the need to be cautious about expectations.

Page 10 of the Schools Forum report pack refers to an original business case. Paul McAteer asked if this was available. Ruth Bagley reported that the Final Business Case had not been located in the Council as yet but would be sought out.

Ruth Bagley referred to the SBC Contracts Manager who would progress this. It was agreed that an initial look at the contract would be done before the next meeting of the Forum in July and a report brought back at that time with options.

3^rd Recommendation

This recommendation asks the Forum to participate in a consultation on the redistribution of the PFI funding gap. 

The Forum agreed to discuss this again when a further report would come back to the July meeting with modelling included.

Kathleen Higgins asked whose decision it would be regarding any reduction in the Council’s PFI contribution.  Ruth Bagley indicated that this would be a Cabinet Decision. It was also noted, however, that any decision to take on any further liability within the DSG would be a Schools Forum decision.