Faith in the future or financial wizardry?

Fanfare surrounded last week's appointment of Sir Angus Grossart as chairman of the Scottish Futures Trust - but concerns remain about the vagueness surrounding the Government's much-vaunted capital investment vehicle for schools and other public buildings. Henry Hepburn reports

It's like pantomime for finance buffs. John "Aladdin" Swinney bounds onstage looking pleased and announces he has a new magic lamp.

The old genie would only grant three wishes if he got a cut, and you had no guarantee that your Caribbean hideaway wouldn't start falling apart after five minutes. The new genie, however, promises not to swipe so much of your treasure.

Sounds good, doesn't it? "Oh no it doesn't!" bellows an audience of opposition MSPs in the stalls. They suspect it's the same genie - just with different-coloured silk pyjamas.

The Scottish Futures Trust promises a better deal for taxpayers than the private finance initiative and public-private partnerships, by issuing bonds to fund new public buildings and capping private profits; opponents claim the trust is merely rebranded PPP.

Yet, for many, this semantic stooshie is a sideshow. John Stodter, general secretary of the Association of Directors of Education in Scotland, said his colleagues were "pragmatic" about the trust; the ideology behind it was of marginal concern.

A number of authorities were in a "holding position", as they waited to see whether the trust could deliver. "Our main concern is that we just get on and build schools, that there's going to be investment in school- building," Mr Stodter said.

Andy Oliver, PPP project manager at Moray Council, believes there is no radical departure from PPP, but insists that raising concerns based on previous controversial projects is like criticising a jet for the faults of a Wright brothers bi-plane.

He stressed, however, that while there was no panic yet about the trust's ability to deliver new schools - with attention largely on current building programmes - councils were starting to ask where the next round of funding was coming from.

"PPP was backed by significant sums coming out of the Treasury," he said. "There's no sign of any opening of the doors of the Treasury by (Chancellor) Alistair Darling. The indications are that the settlement the Scottish Government gets is all they can expect, which would put any government in Edinburgh in a difficult position."

East Renfrewshire Council gave one of the most optimistic responses to the Government's consultation on the trust this year. Even though PFI and PPP have given it several new and refurbished schools, it has decided to participate in a pilot study to test the funding mechanism.

Councillors have set aside party differences - the administration is made up of SNP, Labour, Lib Dem and independent members - to see whether the trust can deliver new 3-18 campuses for Eastwood and Barrhead highs. They were encouraged by the aim of bringing together local authorities to create building programmes of a scale likely to appeal to private developers.

After a recent meeting with Mr Swinney, senior figures from the council were surprised at the lack of detail about the trust. Education Secretary Fiona Hyslop's announcement last week that 250 schools would be "built, funded or under construction" by 2011 through "various funding mechanisms" provided no new clues, with only passing reference made to the trust.

And there is the increasingly black cloud of the credit crunch, although First Minister Alex Salmond recently insisted that safe investments promised by the trust would appeal to an increasingly panicky building industry.

Crucial questions

How much funding will there be and how does this compare to PPP?

When will funding become available?

When will the first school be commissioned?

What financial support will be available to local authorities?

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