Huddersfield MP says schools will be hit by the credit crunch

Jan 7 2009 by Neil Atkinson, Huddersfield Daily Examiner

SCHOOLS will be forced to tighten their belts in the coming months as the credit crunch continues, a cross-party group of MPs warned today.

The schools select committee headed by Huddersfield MP Barry Sheerman said plans must be made now to allow education and children’s services to cope with a more “austere” future.

In its annual report on the expenditure of the Department for Children, Schools and Families (DCSF), the committee predicted there would be less investment in these services in the future.

The report said the concern was that “these serious economic problems could undermine investment in education and related services and could prevent the Government from achieving its objectives”.

It said that the Government could begin to see private companies less willing to enter into private finance initiatives (PFIs), particularly in connection with the Building Schools for the Future (BSF) programme, which aims to renew all secondary schools in England.

In Kirklees, the council is hoping to spend £500m on schools over the next few years.

Under PFI, private companies fund the building of schools, with typically the local authority repaying the costs over the next 25 to 30 years.