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Written Statement - Update on education and skills capital and the 21st century schools programme

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Leighton Andrews, Minister for Education and Skills

I wish to update Members on the 21st Century Schools Programme and expenditure on capital for the period 2011-2014.

The 21st Century Schools programme is a partnership between the Welsh Government, Local Government, the Welsh Local Government Association, Diocesan Directors of the Voluntary Aided Sector and CollegesWales. It is overseen by the 21st Century Schools Programme Board.

In moving from the old formula allocations approach, the Welsh Government has invested in significant transitional projects, these have paved the way for the approach being taken in the 21st Century Schools Programme focussing on improving and rationalising the education and skills estate.

Despite the reduction in capital funding to the Welsh Government every project which has been approved by my Department under the transitional stage of the 21st Century Schools Programme is going ahead in 2011/12 and over the subsequent 2 years and until these projects are completed. Proposed changes to the Programme I will detail later in this statement will only have an impact from 2014.

The first tranche of transitional funding supported 32 projects across Wales with over £77 million of Welsh Government grant.  These projects are largely completed.  Under the two successive waves of larger projects over £337 million of Government support has been committed for a further 34 projects from the Vale of Glamorgan to Anglesey and from Pembrokeshire to Monmouthshire.  These projects are underway and include 26 new schools and 15 Further Education learning centres which have received grant support of £75 million.  These transitional projects in schools and other sectors are set out in the attached annex.

The 21st Century Schools Programme is intended to move us forward beyond the transitional project-based approach.  It is more than a programme of capital investment. It is the expression by authorities and others of their medium and long term strategic planning for the delivery of education in each area and in partnership with each other, diocesan authorities and post-16 providers.  Key to this planned approach has been the development by Authorities of their Strategic Outline Programmes (SOPs).  That is a major undertaking for the Welsh Government and the Programme Board have welcomed the development of this more transparent and planned approach. 

The programme will direct funds to schools that require investment to make them fit for the 21st Century. The aim of the programme is to move away from a capital allocation process that was largely based on annual formulaic allocations to a longer term capital investment programme where collectively we secure prioritisation and sequencing of capital investment. I remain committed to this approach as does the Programme Board.

A first step in establishing this national programme was to obtain a comprehensive picture of the condition and suitability of all schools in Wales. With Authorities, we have undertaken the first ever national survey of schools.That survey demonstrates that 63 percent of our schools are in reasonable condition and less than 2 per cent at the end of their operational life but there is a strong need to refresh and rationalise the schools estate.

The original intention for the Programme was to have a flexible approach to funding with an expectation that most if not all 22 authorities would start their first band of projects within the first four years. Authorities have developed their plans on this basis, programming school changes across a number of phases.  The environment has changed.  There has been a sharp reduction in capital funding imposed on the Welsh Government – taken together a reduction of 40 per cent will occur across the current funding period.  The Independent Task and Finish Group report on The Structure of Education Services in Wales and the move towards strategic and regional working have been developed since the original programme was conceived and since Authorities developed and submitted their Plans.

Against that background, the Board, and the Welsh Government consider that Authorities must be given the opportunity to review the timing and content of their planned investments so as to take the hard decisions early that will ensure funding goes to the delivery of excellence in education not the maintenance of buildings. 
Against the background of national school condition and suitability data for the first time, the scale of aspiration set out in the Strategic Plans is significant – not just to tackle schools in poor condition across Wales but to rationalise and deliver for the future. That aspiration is right – but we must also prioritise and work within the resources that we have collectively. 

Officials in my department will, therefore, be writing to all authorities to invite them to review their forward outline programmes detailed in the SOPS against a sharper prioritisation based on the rationalisation of the school estate (including the reduction of surplus places) together with the cost effectiveness of delivery and condition with alignment to All Age Transformation.

That opportunity will include feedback on Authorities’ Plans.  The Strategic Plans demonstrate Authorities’ commitment to strategic direction with intent to move forward on tackling the surplus capacity in schools through rationalisation of the schools estate education to ensure that the right school is in the right place for effective and cost effective delivery. 

Nevertheless there are elements in most Plans where further strengthening of planning may be possible - focussing for example on provision for additional learning needs,  Welsh-medium education,  the Voluntary Aided Schools Sector and engagement with the transformation agenda.  Across the education and skills sectors in Wales there is an acceptance that we must avoid inefficient duplication of courses between schools and other providers. All Local Authorities and Learning Partnerships have provided us with their transformation plans identifying how they propose to secure improvements for post-16 learners.  I expect Authorities to ensure that their forward Plans take account of both neighbouring authorities and other providers. Where there is lack of joined up delivery on these plans and no evidence of efforts to make progress the Welsh Government will expect the Board to take this into account in its future recommendations and take it into account on its decisions for future capital funding.

I am also acutely aware that in undertaking this exercise local authorities require further clarity around the financial support to be expected from the Welsh Government. The 21st Century Schools Programme has always been a collaborative programme – the assets are owned by authorities and the decisions on what is needed must ultimately be theirs. Against the background of authorities’ potential ability to borrow and the constrained budget provision from Westminster I am now minded, in contrast to the previous round of transitional capital funding, to move to a 50% rate of capital grant support. I wish to build upon the momentum gained through the capital investment programme over recent years. Intervention at this rate will enable the Welsh Government to support more school investment proposals over the life of the programme. 

I believe this is right in principle as the assets will remain with authorities for the long term. My officials will therefore be asking authorities to review their programme against that background.

It is also true that there are more innovative ways of funding capital projects including through partnerships with the private sector.  These are not right for every authority or for every project or group of projects. I am, therefore, also signalling that where it is the most appropriate approach I would be prepared to support revenue funded partnership approaches by putting in place expert assistance along the lines of the waste programme and, subject to annual budget decisions, a revenue stream.

Finally, it is important to recognise how far we have come.  The development of a planned medium to long term programme is to the benefit of Authorities and the Government and ultimately and more importantly to learners and parents.  Giving Authorities the opportunity to reconsider their programme in the light of the likely timing and funding for the next few years can only lead to a better more effective programme.  But that does not mean that there is a period of stagnation - in moving to this planned approach, the Welsh Government has already invested over £415.2 million in support of specific strategic capital investments. We and Authorities remain committed to the delivery of these transitional projects which will provide in total delivery of 66 capital projects.