Priority Schools building work yet to begin nine months after funding announcements

According to a survey by the Local Government Association (LGA), many head teachers have no idea when rebuilding work will begin on their schools while others have been told that contracts for building work are unlikely to be awarded until 2015.

The BBC said that the latest delay to the Priority School Building Programme (PSBP) was due to a lack of private sector investment. The Government was now investigating the European Investment Bank and capital bond markets as potential sources of finance for the £2 billion programme, it claimed in a report.

The Government named the 261 schools which would receive funding under the PSBP in May 2012, and said that the first new schools built under the programme would open in 2014. Schools were selected for repair, rebuilding or refurbishment under the programme based on their need.

Infrastructure law expert Kate Orviss of Pinsent Masons, the law firm behind Out-Law.com, said that the LGA's findings were "the latest and most disappointing example" of the Government failing to deliver on its commitments to boosting the economy through investment in infrastructure.

"The construction industry has been waiting for the PSBP to come to market since the cancellation of the Building Schools for the Future (BSF) programme three years ago, and with increasing anticipation since the positive noises emerging from the Education Funding Agency (EFA) in May last year," she said.

"Whilst a number of new school schemes have begun to come to market under the auspices of the Academies Framework, the industry has had to wait for the outcome of the PFI consultation that took place in February 2012 for the bulk of the programme. Specifics of PF2 were published in detail in December last year but still the 219 schools to be privately financed under the PSBP don't come to market. Why?" she said.

Orviss said that the Government's fragmented infrastructure investment policy pointed towards it "trying to solve the conundrum of the absence of a long-term debt market in isolation from the private sector".

"The Government has good theoretical ideas: the Pension Investment Platform for example," she said. "However, as was clear from evidence being given to the Treasury Committee last week, Government often doesn't have the requisite skills to drive out solutions. That has always been a strength of the private sector, and if the private sector was given the chance to find a solution to the financing problem for PSBP it would."

According to the LGA's research, councils were being forced to spend "tens of thousands of pounds or more" to fund "bare minimum" improvements to school buildings. It had received reports of schools due to receive PSBP funding needing urgent roof repairs, heating system repairs, asbestos removal and faulty wiring repairs. Devon County Council told the LGA that it would need to spend £2.5 million on "urgent health and safety works" for eight of its schools that are due to receive funding while North Lincolnshire, Suffolk County Council and Bury Council had either already spent or had set additional money aside to fund essential repairs.

"The announcement of much-needed funding to fix hundreds of the country's most crumbling schools was a positive move, but that was last summer and many parents are still none the wiser about when their child's school will be brought up to scratch," said David Simmons, chair of the LGA's Children and Young People Board.

"The situation is now unacceptable and threatens to severely impact on our children's education. Councils are stepping in to keep schools running while government struggles to get its act together. Local government is already carrying out basic repairs but we could deliver so much more with funds that are currently tied up in government red tape," he said.

The PBSP replaced the previous government's BSF scheme, which was cancelled in July 2010. The programme, which has been heavily delayed, is intended to address the needs of the schools in the worst condition in the country, with funding resources allocated from a set budget according to need. Of the 261 schools due to receive funding, 42 deemed to be "in the very worst condition" or those for children with special educational needs will receive a share of a Government capital grant to complete the work, while the remaining projects are due to be funded by way of private finance arrangements.

As announced in December, the £2bn privately financed element of the scheme is due to be the first project to be procured using the Government's new 'PF2' approach to the private financing of public infrastructure.