Contract review ordered

22nd December 2006 at 00:00
the scottish executive has finally ordered a review of the controversial privately financed contract under which West Lothian College was built in 2001 at a cost of pound;18 million.

Since then, the college has come under such serious financial strain as a result of the contract that the Auditor General for Scotland reported last year that "without a significant increase in other funding, the college will be unable to meet its contractual commitments."

The college was receiving special support to help it cope with its circumstances, but this was to be significantly reduced from next year, thus forcing the executive to move.

The announcement that the whole position was to be reviewed by the Scottish Funding Council was warmly welcomed by Sue Pinder, the college principal, who famously dismissed the contract as "a pig's arse," in an interview with The TESS three years ago.

"As the executive gains experience and knowledge in the best practice of PFI, it is heartening to see them reviewing past projects and applying their learning," Ms Pinder added.

The college was the only one in Scotland to be fully funded through what was then called a private finance initiative, since superseded by public private partnerships.

The college was the victim of a change in FE policy, its original PFI costings having been based on the "go for growth" approach in student numbers, which attracted increased grant for those that were successful.

But the switch to "collaboration and consolidation" in colleges' activity, turned this policy on its head and left West Lothian College with a reduced grant from the Executive, out of which it had to repay its existing PFI commitment of pound;42 million over 25 years, according to the Auditor General.

Ministers have now acknowledged the inevitable and concluded this is a poor deal for the public purse, as the official statement suggests. They have recommended to the funding council "the appraisal of all potential funding routes to ensure the arrangement in place represents the best approach for the taxpayer over the remaining lifespan of the contract".

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