Credit crunch threat to schools revamp

The economic downturn is threatening the availability of funding for the Government's school building programme, MPs have warned.

The Building Schools for the Future programme to rebuild every secondary school in the country at the cost of £45 billion is planned to be funded largely using Private Finance Initiative deals.

But the current economic conditions means that funding may be harder to secure than previously expected, according to a report by the House of Commons' Children, Schools and Families Committee.

"The private sector may be far less willing to enter into PFI arrangements in connection with the Building Schools for the Future programme," the report says.

The scheme is intended to provide 30,000 of the 100,000 jobs planned to be created by Prime Minister Gordon Brown's recession-fighting public works programme.

The committee has demanded that the department makes "a clear statement about the programmes future".

Chairman of the committee, Barry Sheerman, said: "It is vital that our scrutiny is not hindered by confusion over which spending streams relate to which objectives, and we've asked the department not only for better and clearer presentation, but for much more detail in their 2009 annual report."

Public Expenditure, First Report of Session 2008-09 is available here

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