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Highland fears heavy interest burden on new schools cash

Highland councillors have been shocked to learn that four schools to be built under a public private partnership (PPP) scheme at pound;16 million will end up costing the public purse nearer pound;80 million. They have asked for further information before final contracts are signed with the preferred bidders MJ Gleeson and the Royal Bank next month.

The PPP deal will bring primary schools at Spean Bridge and Tomatin, a replacement secondary school at Drumnadrochit and the first ever secondary school for Ardnamurchan.

The council will pay an annual unitary charge to the consortium to use the schools for 25 years, after which it will control the assets. The initial unitary charge will be some pound;2.8 million but that figure will increase annually and negotiations on the charge have still to be concluded.

The deal has been made possible by the Executive's award of "level playing-field support", in essence a subsidy to help pay the annual unitary charge. Over the 25 years the project will cost the Executive just over pound;38 million, with the council contributing an estimated pound;38 million. Andy Anerson, chairman of its education committee, said that councillors are uneasy but added: "This is the only option open to us. We are also hampered in a way because there is no other similar PPP in existence at the moment, with which to compare it.

"We had to weigh up whether or not to go ahead with new schools in areas where they are badly needed, and councillors decided that to build the schools was the right thing to do. We will get another report on the details before the political decision to give the final go-ahead is taken and the contracts are finalised in February."

Sports provision and facilities for distance learning will be incorporated in secondary schools under the scheme, which will also free the council's capital budget for major developments at Millburn Academy in Inverness and Portree High. Alan Beaton, a Skye councillor, said: "This is the only way we can get a virtually new school in Portree. That is the only consolation with the PPP, but I still feel it would have been better for the Government to have given us the pound;16 million and been done with it."

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