Private finance builder goes bust

24th October 2003 at 01:00
Classrooms languish half-built as pound;340m PFI project covering 27 schools , collapses. Dorothy Lepkowska and Karen Thornton report

The biggest privately-financed school building scheme in the South-east was halted this week after a construction company involved in a pound;340 million PFI project went bust.

Ballast plc had been sub-contracted by the Tower Hamlets Schools Partnership to carry out major building and repair work at 27 of its east London schools.

But last week Ballast's Dutch parent company Ballast Needham stopped funding its UK subsidiary and it was placed in administration.

The company in charge of the PFI project, leading international financier, Babcock and Brown, is now looking for another building firm to take over the work.

The PFI scheme included the complete rebuilding of two primary schools, Ben Jonson and Bonner, and a new arts and leisure block at Langdon Park secondary.

Other projects included improved safety and security work, as well as the construction of new classrooms and ICT facilities at schools across the borough.

A spokeswoman for Tower Hamlets Council, said: "The council and its PFI partner are working to ensure that pupils will not suffer any interruption to their education as a result of this situation and that any delays in construction work will be kept to the minimum.

"Independent assessors have visited schools to ensure safety where building work has temporarily halted. The LEA will continue to monitor all sites."

She said accountants Deloitte and Touche had been appointed as administrators for Ballast.

Alex Kenny, the NUT's branch representative in Tower Hamlets, said that at one school, furniture delivered for refurbished science rooms had been taken away again the next day. Another school has roofless half-built classrooms.

And the education authority had to step in to cover the lease on mobile classrooms which suppliers had threatened to remove because bills had not been paid.

Mr Kenny said: "Those of us opposed to PFI warned against these things. In a contract with the local authority, there are safety nets. But at the moment, it seems none of the work can continue.

"A lot of schools are being left as building sites, with no work going on and no obvious site security. I'm not sure how that's going to be dealt with."

Martin Tune, head of Bonner primary, said there were no health and safety concerns surrounding staff and pupils because it was a self-contained site away from the existing school buildings, which was supervised at night.

A spokesman for Babcock and Brown said the construction firm Heery International would take over building work as an interim measure.

"The temporary measures put in place have the full backing of the education director at Tower Hamlets," he said.

"The company is one of the leading investors in PFI and it is our job to act quickly to get things working again."

Leadership 27

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