The Government this week abandoned the £55 bn Building Schools for the Future programme, cancelling over 700 school schemes, Construction News reported.
About £7.5bn of capital investment already pledged will be withdrawn, leaving contractors at various stages of the costly bid process looking at huge gaps in their order books.
A future pipeline running to tens of billions of pounds has been put on ice while a new government taskforce assesses how government can build schools more cheaply.
Procurement through the £4bn academies ‘super-framework’ was also put on hold while the review takes place.
The announcement of cuts was even tougher than had been expected, Building reported, with only BSF schemes that had reached financial close allowed to go ahead.
An announcement on the fate of the 14 BSF schemes at preferred bidder stage will be made in the next three to four weeks, with the possibility that the “sample” schools where r design work is relatively advanced could progress.
It is unclear when a further announcement on the 123 academies on hold will be made.
A total of 719 schools will no longer be rebuilt or refurbished through BSF, of which nearly 180 schools were projected to be new build, 319 to be remodelled or refurbished, 63 to be ICT-only and 153 had unconfirmed plans.
Twelve academy projects were scrapped, and 115 subjected to the review.
Education Secretary Michael Gove told the House of Commons: “The BSF scheme has been responsible for about one-third of all this department’s capital spending.
“But throughout its life it has been characterised by massive overspends, tragic delays, botched construction projects and needless bureaucracy.
“The last Government was supposed to have built 200 wholly new schools by the end of 2008. It had only rebuilt 35 and refurbished 13.
“BSF schools cost three times what it costs to procure buildings in the commercial world and twice what it costs to build a school in Ireland.”
Cuts to BSF were expected but the decision to freeze so many projects was a shock. Jeremy Eavis, managing director of Apollo Education, said: “It is difficult for the industry, which has relied heavily on BSF for the last few years. Whether it was inefficient or not, it was the only show in town.”
