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Private cash plan to pit schools against roads

Details of a new scheme to promote private-sector involvement in projects to replace and improve school buildings have been sent out to local authorities, writes Biddy Passmore.

The Schools Renewal Challenge Fund will from next month provide Pounds 30-40 million for which authorities can bid, on condition that they raise some funds from private sources. Much of the cash will be used to pay for urgent health and safety work.

But barely had LEAs digested this change than news leaked out of a much more far-reaching Cabinet scheme that could eventually force all capital projects for all local services to compete against each other. Thus education would have to bid against housing, roads and social services for funds for capital projects, with priority given to those that had attracted matching funds from the private sector.

The plan, promoted by Michael Heseltine, the Deputy Prime Minister, and backed by John Gummer, the Environment Secretary, is understood to be opposed by Gillian Shephard. The Education Secretary believes the scheme will favour glamorous projects attractive to private investment rather than essential school repairs.

The Heseltine plan, called "Capital Challenge", has gone out for consultation. If approved, it would start in 1997-98 with a small share - perhaps a tenth - of the Pounds 3.5 billion councils spend each year on capital projects, rising rapidly to include all capital projects.

Meanwhile Cheryl Gillan, schools minister, this week approved the spending of a further Pounds 7.7m on school buildings and reorganisation plans in the current year in 36 local authorities. One scheme is for Acland Burleigh School in London to build classrooms in partnership with a catering company.

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