Headteachers forecast having to fork out over £150,000 more in private finance initiative (PFI) payments, with one admitting: “I don’t know what to do.”
While leaders are already struggling with growing financial burdens, three in the West Midlands are bracing for a 12.9 per cent rise to annual payments owed to private companies that built their schools.
Bosses have revealed the spiralling costs have forced them to “scrimp and scrape” as they each have more than a decade left on their PFI contracts. Teaching vacancies are also having to be left unfilled.
Successive governments have used PFI to fund new schools since the late 1990s. Private companies build and maintain sites in exchange for mortgage-style payments, typically for 25 years, before handing them over to taxpayers. Repayments also cover management of maintenance services.
