Detail of schools building programme reveals focus on efficiency, says expert

Out-Law Analysis | 26 Sep 2011 | 3:36 pm | 2 min. read

OPINION: There is still a lack of clarity about exactly how the Government's new schools-building programme is going to work, but details are beginning to emerge and they show that achieving improved value for money will be a major focus.

The Government's plan of gathering projects together in batches should create a lean procurement structure and mean more schools will be built for the allocated £2 billion investment.

Last July the coalition Government scrapped Labour's £55 billion programme to rebuild every secondary school in England, the Building Schools for the Future Programme (BSF).

This July it announced a new programme to spend £2bn on construction costs for England's most in-need schools. Specifics have been sketchy but details are now beginning to emerge.

Called the Priority School Building Programme, it will attend to the schools in the worst condition in the country.

This will affect between 100 and 300 schools. This is a large spread of possible numbers, but the final total will depend on which schools are identified as being in the worst condition. The £2bn will be spent on a larger number of cheaper projects, such as primary schools, or a smaller number of more expensive ones, such as secondary schools.

The schools will be chosen on the basis of condition and the resource allocated after that.

The work itself will be split into annual batches of work, in a process that will probably last five years. Within the annual batch will be a collection of probably five to seven projects, with each project being of a similar value.

Within a project there will be a number of schools – one project might have a greater number of primary school projects than another, secondary-heavy group, but the overall value of a project should be similar because primary school projects will involve smaller sums.

The Government procurement plan is focused on cost saving. One school within a project will be designed to an advanced level – Royal Institute of British Architects (RIBA) stage D – before a preferred bidder is selected for the project.

The intention for the remaining schools will be to develop their design after preferred bidder, taking them again to RIBA stage D by Financial Close for the first school. The remaining schools are anticipated to have their designs finalised within a short window following financial close.

This approach should have a beneficial impact on the time taken and  cost involved in procuring these schools, both key areas which came in for scrutiny in the James' Review, a Government-commissioned review of capital spending in education that was published earlier this year. .

It remains to be seen how much consultation over, for example, design will be required with stakeholders, particularly if there is to be a central procurement team which will be keen to drive down cost and deliver projects quickly.

To avoid the private sector having to deal with a series of procuring authorities if batches run across geographical boundaries or include a mixture of schools and academies, the Priority School Building Programme will deal only with the Department for Education's new Education Funding Agency and the intention is that the documents are signed by the Secretary of State.

This will make the process easier to manage, cheaper to engage with and more streamlined. The success of the process will depend on how the projects are batched - if efficiencies really are to be driven out then there must be some consistency of products or profiles within batches. Contractors won't be able encourage efficiencies within their supply chain where there is no consistency of approach.

It will also be interesting to see what sort of value the Government attaches to an individual project – too high and they risk alienating those smaller enterprises they are so keen to encourage. Too low and the main players may have less appetite to bid.

There is much still to find out about the specifics of the plan, but at least those involved in privately financed projects have an insight into the process ahead. In the current climate any suggestion of new opportunities are very welcome.

Kate Orviss is a specialist in projects and construction law at Pinsent Masons, the law firm behind Out-Law.com