- By Branwen Jeffreys & Sallie George
- BBC News
Schools are spending tens of thousands of pounds more a year to meet rising costs of contracts with private firms.
These Private Finance Initiative (PFI) schools are locked into 25- to 30-year contracts in which charges rise more than at other schools.
One school said it was spending thousands of pounds a year to keep its playing-field grass below 2.5cm (1in), as the “rigid” contract demanded.
PFI investors say the contracts give long-term value for taxpayers’ money.
Middlefield Primary in Speke, Liverpool, opened after the local authority entered a PFI agreement for new school buildings.
Head teacher David Potter says nearly 20% of the school’s entire budget is now spent on meeting the terms of the PFI contract – squeezing what he can spend on classroom staff.
The school has to pay the PFI company for its day-to-day maintenance, catering and cleaning, which will cost more than £470,000 this year – a rise of more than £151,000 since 2021.
And what Mr Potter says is one of many “rigid” details stipulates the grass must not grow higher than 2.5cm, even in the winter when the playing field is hardly used,
“Come rain or shine every week, the grounds maintenance team come out and they cut this field,” he says.
“We should have the freedom to say, actually, we think we can do without.”
Maintaining the grounds costs the school around £30,000 a year.
The contract does not allow the school’s head teacher to shop around for better prices from other suppliers – something Mr Potter finds “incredibly frustrating” as he watches prices rise.
Such costs have forced him to make savings elsewhere. Four members of classroom staff have not been replaced since 2020.
The PFI company said the contract could be renegotiated 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, before the initiative was scrapped, in 2018.
Launched by a Conservative government in the 1990s and used by both Labour and Conservative leaders to build schools and hospitals, the scheme sees private companies retain ownership and responsibility for maintenance until the debt is repaid from taxpayers’ money.
As a result, head teachers are locked into using the same companies and cannot shop around on price – something Mr Potter finds “incredibly frustrating” as he watches prices rise.
PFI costs go up by the Retail Price Index, a typically higher measure of inflation no longer used as an official government measure.
Ten other PFI primary schools in Liverpool have provided figures showing similar price rises to Middlefield.
‘You feel like a failure’
Costs are also spiralling for Glyn Potts, head teacher at Newman RC College in Oldham, a large secondary school that was opened in 2012.
But he is most concerned by the state of the building. Since pupils moved in it has been beset by problems with the roof, leading to hundreds of thousands of pounds being withheld from payments to the private contractor.
Children were sent home in 2021 after problems with the heating system led to radiator pipes bursting – spewing “red-hot” water and repeatedly flooding classrooms.
“When a radiator bursts in a school, the ferocity of the water will arc three or four foot up,” Mr Potts says.
At times, radiator bursts meant up to 60% of the school was out of use.
In order to get the heating system replaced Mr Potts had to ask the council to argue with the contractors.
Speaking to the BBC, he put his head in his hands as he said: “I have to go to those parents and say I’m doing the very best by them with no impact.
“You feel like a failure.”
One one of our visits to the college, water gushed through the roof of a classroom when its ceiling collapsed as maintenance contractors tried to fix heating on the floor above.
In ceiling spaces around school corridors, large plastic tubes are visible to collect roof leaks.
Other head teachers in England told us they had been advised against speaking publicly about the pressures PFI costs are causing, because of non-disclosure agreements that are built into the contracts.
Last week, Stoke-on-Trent City Council held a meeting in private with the 88 PFI schools in the city which were warned they face “double digit” percentage increases in their PFI costs within weeks.
Stoke’s PFI contract, which includes the largest number of schools, will be among the first to come to an end in October 2025.
The BBC has seen notes of the meeting and spoken to people who attended, although the public were excluded.
Meg Hillier, chair of the Public Accounts Committee of MPs, which looks at value for money from taxes, told the BBC the secrecy around these contracts was “ridiculous” and “unacceptable”.
“If there was more openness, the publicity would shock many citizens and taxpayers, and that might push the companies to think again and make sure they’re not wringing every last penny out of our school system,” she said.
The Department for Education said it was increasing support for schools in PFI contracts by 10.4% in the coming financial year.
Speaking on behalf of PFI investors, Lord John Hutton said price comparisons were made regularly, but school budgets had not kept up with inflation over the lifetime of PFI contracts.
He said the contracts “do reflect good value for money for the taxpayer” and “make sure that schools are getting value for money when it comes to cleaning, catering and everything else”.
Additional journalism by Rob Cave.
You can hear more about this story on Monday at 8pm in The Great PFI Debt on BBC Radio 4, and on BBC Sounds.
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William Turner is a seasoned U.K. correspondent with a deep understanding of domestic affairs. With a passion for British politics and culture, he provides insightful analysis and comprehensive coverage of events within the United Kingdom.