Two Derry schools to end up costing £163m

A TOTAL OF £163 million will have to be shelled out from public coffers for two Derry schools built as part of the same development.

St Cecilia’s and St Mary’s Colleges are subject to the same 25-year Derry Diocese Public Private Partnership (PPP) Project, which is costing £6.38m every year.

There are now 22 years remaining on the contract, which involves the schools and education authorities paying a private consortium annually for having designed and built the two colleges, and for running and maintaining them.

While the Department of Education told the Journal that all parties were fully aware of their contractual obligations at the time of signing, concerns that the massive costs to the public purse were not widely known have now been voiced.

There have been further concerns raised that the contract allows private operators to have a say in whether school staff at St Mary’s and St Cecilia’s can book classrooms and sporting facilities for extracurricular activities.

Four years after the Derry PPP was signed, Education Minister John O’Dowd in June 2012 announced a £173m spending plan which includes funding for 18 new school buildings across Northern Ireland.

In contrast to St Mary’s and St Cecilia’s, it has now been confirmed that these will be built with public rather than private funding, and none of the new schools will be subjected to such PPPs, although the department denied this was a change in policy.

The more recent allocations include £19.6m for Foyle College, £7.4m for Belmont House Special School, £6.4m for Rossmar Special School in Limavady and a further £7 million for newbuild Eglinton and Ebrington Primary schools.

This new spending is the first to be announced since 2010 when capital spending was frozen.

Former Education Minister Caitriona Ruane confirmed the signing of contracts for St Mary’s and St Cecilia’s under the same contract back in December 2008. Her Department at the time said that the capital cost of the two schools would come to £38 million.

Concerns have now been raised that local people were not aware, at the time or since, that this referred to the construction costs only, and the actual cost of the 25-year PPP would be over four times this amount.

SDLP Derry City Council election candidate for The Moor, Emmet Doyle said: “Why weren’t people told about this? At the time the Department statement mentioned the £38 million capital injection but made no mention at all of the £163 million across 25 years. Why didn’t the Minister just come out and say, this is the situation.

“St Mary’s and St Cecilia’s deserved new builds, they’re fantastic schools with reputations as leaders in education, yet Catriona Ruane and her colleagues didn’t priori ti se them and the Department have now tied the schools to these contracts.

“If we work it out on the basis that there are 114,000 people in the Derry area, the cost is £1,500 a head, that’s the debt owing on these two schools. The Minister and his colleagues should have been straight with the people of this City rather than trying to cover up the true cost of the project, and adding insult to injury with his local colleagues telling us their Minister has ‘delivered’.”

The Derry Diocese PPP project involves a 25 year contract to design, build, finance, operate and maintain St Mary’s College and St Cecilia’s College.

The contract is between the schools’ trustees, St Canice’s Educational Trust (based at Bishop’s House, Francis Street, Derry), and the PPP operator, Belfast Educational Services (Derry) Ltd, which has an address in Newry.

The operator is a consortium involving Newry-based construction firm O’Hare and McGovern Limited and Interserve Private Finance Initiative (PFI) 2005 Limited.

A spokesman for the Department of Education told the Journal: “The £38 million capital contract which was announced by then Education Minister Caitríona Ruane in December 2008 refers to the construction costs only; it does not include the cost of ongoing facilities management and building maintenance services.

“Under a PPP project the PPP operator is responsible for a range of facilities management services that would previously have been provided by the public sector, e.g. grounds maintenance, pest control, waste management etc.

“The total cost to the public purse covers the private sector’s initial capital outlay in designing and constructing the facilities, as well as the provision of planned/reactive maintenance and facilities management over the 25 year lifetime of the contract. Therefore, the costs cannot be directly compared to costs for a conventionally procured school.

“Since the unitary charge became payable in 2010, circa £22.05 million has been paid.

“Of this, the two schools have together contributed £447,000; the Western Education and Library Board £860,000 and the Department has paid £20.7 million.

“In 2013/14 the unitary payment was £6.38 million.

“The schools, WELB and the Department will continue to meet the unitary payments for the remainder of the project.”

He added: “The £173 million investment announcement in June 2012 is the estimated capital/construction cost to advance /procure the schools included in that announcement through conventional means.

“These school builds will not be subject to PPP, and the Department will be providing the necessary capital funding. This is not a change in policy as the Department has always procured schools in this manner, in addition to any schools procured through the Private Finance Initiative.”

Speaking about the availability of classrooms and sports facilities, the DE spokesman said it was “policy to ensure that schools are embedded within their communities and that, as far as is practicable, are open for community use beyond school hours.”

“However,” he added, “school requirements will always take priority over wider community use. The additional hours required for both school and third party usage, outside of core sessions, is agreed between the trustees (in consultation with the school) and the PPP operator and included within the PPP contract.”

A spokesman for the Catholic Council for Maintained Schools (CCMS) confirmed they had not paid anything as part of the Derry Diocese PPP.

He said: “CCMS is an advisory body that has no monetary responsibilities. Our core business is to give advice and guidance to the trustees in the provision of school buildings, and governors and principals in the effective management and control of schools.

“We support projects, and present proposals to DE for consideration. This being the case we have no responsibilities for funding projects like St Mary’s and St Cecilia’s.”

Both schools and the Western Education and Library Board have declined to comment on the matter.

The ‘Journal’ had also tried to contact one of the private firms involved in the Derry Diocese PPP but by yesterday afternoon has received no response.