Skip to main content
article icon

EU funds sought to prop up BSF plan

News | Published in TES Newspaper on 5 December, 2008 | By: Richard Vaughan

BSF agency goes cap-in-hand to European Investment Bank

The agency delivering the Pounds 45 billion Building Schools for the Future (BSF) initiative has been forced by the credit crunch to go cap-in-hand to the European Investment Bank to secure funds.

The approach to the bank is an attempt to ensure that the vast school renewal programme is not undermined by the economic downturn.

Partnerships for Schools (PfS), the delivery body, has blamed the recession, claiming that the “challenging” financial conditions have meant UK banks are either unwilling or simply unable to back the scheme.

It is understood that talks are “well under way” with the European Union’s investment agency to bail out up to five local authorities that are struggling to find private cash.

Among those local authorities hoping to receive a funding boost is Barnsley, which is bidding to build nine new secondary schools, with the European bank supplying up to 50 per cent of the cash.

A PfS spokesperson said: “These are challenging times. Lending conditions in the private finance initiative market have tightened considerably and we are working extremely hard to manage the current challenges and minimise any delays.

“Exploratory discussions with the European Investment Bank are now well under way, with a view to them contributing to the funding of a number of BSF deals.”

It is not the first time the partnership has had to turn to the bank. It has already provided funding for Newcastle’s BSF programme.


Subscribe to the magazine

as yet unrated

Comment (3)

  • This isn't a surprise - instead of using government borrowing to finance the new schools, instead the BSF programme relies on the builder to raise the funding, which the govt then repays over 25 years. If you were a big bank, which would you prefer to lend to - a government or a builder? And which would get a better interest rate on the loan?

    Unsuitable or offensive? Report this comment

    11:08
    5 December, 2008

    all@rfleming.net

  • Hi, in Suffolk they (the ruling tory party) want to use the money to destroy the well established and successful Middle school system, destroying confidence of the teachers, pupils and parents. A total waste of public funds and of peoples lives.

    Unsuitable or offensive? Report this comment

    21:11
    5 December, 2008

    itsteapot

  • Can anybody explain why the EIB is underwriting the investment of the big banks so commercial banks can take control of state assests which will be rented back to the state for the next 25 years ? HOw come when we were a poor country we could build schools within the local ecconomy ?Where loads of little schemes running locally delivered results through the local building ecomomy, schools and kept the money in the local economy. Now we are successful we decide to joint all the needs together under one umbrella which is so massive that only European money and complex funding with bankers and lawyers (and god knows how many civil servent) can get involved. (what do they cost and contribute I wonder) With the collapse of the £ - even our strongest national companies like RM will be easy pray to international take over-as they hold such irrevocable access to public cash for the next 25 years. Net result - our education system works for the benefit of some tosser in the Cayemen Islands, and money is hooved out the not just local economy but the national one. Has anybody noticed who now owns Northgate ?

    Unsuitable or offensive? Report this comment

    17:06
    12 December, 2008

    styloid

Add your comment

Subscribe to the magazine

Related articles

More Articles

Join TES for free now

Join TES for free now

Four great reasons to join today...

1. Be part of the largest network of teachers in the world – over 2m members
2. Download over 600,000 free teaching resources
3. Get a personalized email of the most relevant resources for you delivered to your inbox.
4. Find out first about the latest jobs in education

Images