Contractors suffered a blow this week as hundreds of school building projects were scrapped by new education secretary Michael Gove.
The Building Schools for the Future (BSF) programme, accounts for one third of the Department for Education’s capital spending budget. It was criticised by the new government for being bureaucratic and beset by delays and overspends.
The entire programme was estimated to cost £55bn and intended to rebuild or refurbish all schools by 2020. But Monday’s announcement wiped out plans for 715 new school builds and refurbishments, saving the government £1bn.
The UK Contractors Group warned that the news would place more pressure on contractors who have already suffered severe job cuts in the recession.
“It’s clearly not good as there will be a hiatus in spending,” said UK Contractors Group director Stephen Ratcliffe. He added that the industry would lose skills without the capital expenditure.
Only those schemes that have reached financial close will remain, while the 14 schemes that have reached preferred bidder stage will be subject to review. The news will provide little comfort to contractors who have spent up to £10M developing such schemes.
Over £1.5bn worth of BSF schemes had announced a preferred bidder this year, with over £650M worth reaching the milestone since the general election. Gove also announced that the £1M per year design advice service provided by the Commission for Architecture and the Built Environment (CABE) to the BSF scheme would also be scrapped.