Hampshire County Council

Buildings Land and Procurement Panel Item

4 April 2006

New Deal For Schools Modernisation (Condition) Funding and Programme

for 2006/07 and 2007/08

Report by the Director of Property, Business and Regulatory Services

1.0

Summary

1.1

This report outlines the progress made against the current NDS programme for 2005/06, which was considered by the Panel in April 2005 and seeks agreement to proceed with a further programme of NDS Condition projects for 2006/07.

2.0

Review of Progress Against the Current NDS Condition Programme for 2005/06

2.1

The Executive Member approved the Panel's recommendation for the 2005/06 NDS Condition programme on 5 April 2005. That programme comprised over 112 major capital repairs/replacement projects plus external redecoration contracts totalling some £11.3 million. The DfES require this expenditure to be fully committed and bills paid by August 2006, giving around 18 months in which to procure and complete the programme. In order not to lose the advantage of this funding stream, the implementation of the NDS Condition programme is treated as high priority. The 2005/06 NDS condition programme is on target for completion by August 2006.

2.2

A noticeable impact is starting to emerge at schools where the NDS investment has been used to modernise teaching spaces and put into good repair major structural elements of the building stock and their mechanical and electrical engineering services. Part of the NDS Condition funding is being used to reduce recurring maintenance cycles and programmes of work, and to support the Cabinet target reductions for energy. The SCOLA cladding programme for instance, which has been implemented over the last 5 years, is contributing to a £750k reduction in the overall costs of external redecoration and this is expected to rise to around £1 million a year, on completion of the programme.

2.3

Whilst the significant NDS condition investment in schools is having a positive impact on the state of the schools building stock, the effects of inflation and further deterioration in the buildings is, in financial terms, leading to a standstill position in the overall liability associated with the schools estate. The Condition Summary Data for the Schools AMP in Hampshire shows an increasing condition liability across all schools of around £301m.

3.0

NDS Condition Funding For 2006/07 and 2007/08

3.1

The Department for Education and Skills (DfES) has confirmed the next two years of Modernisation funding for 2006/07 and 2007/08 in the total sum of £23.33 million and £23.67 million respectively. This represents the highest NDS award of any single Authority in the country. Beyond this period there is no certainty that NDS Modernisation will continue.

3.2

The Modernisation funding is allocated to local authorities according to the DfES's assessment of need and comes with a specific direction as to how the allocations are to be proportioned across primary and secondary schools. Executive Members agreed in July 2003 that the Modernisation funding should be further split between suitability (improvements) and building condition work in the ratio of 46% and 54% respectively. Table 1 below summarises the amount of Modernisation funding allocated to condition over the next two years and the breakdown between primary and secondary schools.

Table 1: NDS Condition Allocations 2006/07 and 2007/08

Year

Primary £m

Secondary £m

Totals £m

2006/07

6.572

6.028

12.6

2007/08

6.572

6.211

12.783

Totals

13.144

12.239

25.383

Inclusive of Professional Fees

3.3

It is proposed that a further report is prepared in the Autumn that will set out the NDS programme for 2007/08 in order to develop an early communication strategy with schools to coincide with the publication of the next schools SLA.

4.0

NDS Condition Project Selection And Programme For 2005/06

4.1

The majority of NDS Condition funding is being directed at major capital repairs/replacements, as opposed to patch and mend strategies, which will help to reduce future recurring repairs and maintenance. Table 2 below provides a summary of the main areas of proposed NDS Condition expenditure for 2006/07. The detailed schedule of projects for approval are shown in Appendix 1.

Table 2: Summary of Proposed NDS Condition Expenditure For 2006/07

Category of Work

Expenditure £000

Mechanical Services - Replacement Boilers, Heating and Hot Water Systems

1,764

Replacement underground main services

297

Replacement of Electrical Systems and Components

805

SCOLA 1 & 1A Recladding

1,810

Other Window Replacement and External Fabric Repairs

1,245

Internal Fabric Repairs and Fire Precautions

350

Re-roofing

2,035

External Redecorations

1,276

External Works

191

Contributions to Capital Schemes

250

This table excludes Professional Fees and Contingency.

4.2

Although the NDS investment of £12.6 million is significant and will benefit over 120 schools this year, the overall backlog of repairs and maintenance liability remains high at around £290 million for Community and Foundation schools. This represents a £40 million increase on that reported to Members in April last year. The main reasons for this increase in liability relates to the rising cost of repairs and the identification of further deterioration of the estate when properties are resurveyed.

5.0

Special SCOLA Bid

5.1

In October of last year a special bid was made to the DfES for an additional £20 million of funding specifically aimed at recladding the external fenestrations of the early SCOLA school buildings. A copy of the bid brochure has been deposited in the Members Room for information. To date no official response to this SCOLA bid has been received from the DfES. The effect of not receiving additional support means that the NDS Condition funding continues to be used to fund SCOLA recladding with a consequential reduction in other major repairs such as re-roofing and replacements of engineering services.

6.0

Conclusion

6.1

The NDS Modernisation programme has been a major source of funding for helping to address the backlog of repairs and maintenance at schools over the last 5 years. The funding has allowed a move away from a patch and mend strategy and more toward planned programmes of major repairs and replacement of complete elements of the buildings and their engineering services. The future of the NDS modernisation programme is uncertain beyond 2007/08.

6.2

Whilst the NDS condition programme is continuing to have a positive visual impact on the condition of school buildings, the overall condition liability, in financial terms, is rising. This relates to the increasing cost of carrying out repairs and maintenance and the continuing deterioration in the estate.

6.3

The proposed programme of NDS condition work for 2006/07 will complete another phase of investment in schools that is principally being directed at major repairs and replacements that will help reduce recurring maintenance costs in the future.

7.0

Recommendations

That the Panel advises the Executive Member of Policy & Resources that:

1. Approval be given to the priorities and programmes for the NDS

Condition Fund for 2006/07 as detailed in Appendix 1.

Section 100 D - Local Government Act 1972 - background papers

The following documents disclose facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of this report.

NB the list excludes:

1 Published works

2 Documents which disclose exempt or confidential information as defined in the Act

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