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EFA seek legal adviser for £2bn PFI schools

The Education Funding Agency is seeking a legal adviser for its £2 billion PFI schools programme as it confirmed PFI school batches are likely to range in value and size from around £50m (5 schools) to more than £100m (16 schools).

The schools programme was expanded in May to include £400m of capital funding for 42 schools as well as the promised £2bn PFI for the remaining 219 schools to make it onto the priority list.

In a briefing document for legal firms interested in tendering for the work, the EFA confirmed the structure of the PFI part of the Priority Schools Building Programme, to include the following.

  • The PFI part of the programme will see approximately four “batches” of schools procured each year for the next five years, ranging in worth from around £50 million to more than £100m.
  • Each PFI batch is likely to include between 5 and 16 schools and will be procured as a standalone project.
  • The schools within batches will “likely span multiple local authority areas” and be a mix of schools from maintained, voluntary and academy sectors.
  • Three bidders will be taken into the dialogue phase, expected to last around 18 weeks, with the shortlist reduced to a preferred bidder.
  • Bidders will be asked only to design one primary and one secondary school during dialogue, with these designs being required to be capable of being rolled out as standard for the subsequent schools in that batch with adaptation where necessary.
  • Each batch is expected to be procured through competitive dialogue within approximately one year from OJEU notice to financial close, with the first schools in the programme opening in the academic year 2014/15

It was reported in May that the schools work was set to be broken down into five or six batches annually, worth a total of around £400m, with three bidders reduced to one for each batch based on design bids for one or two schools.

Batches of the capitally funded schools will also be procured each year over the next five years, however this briefing note relates only to the PFI programme.

Each project will be led by an EFA team comprising project management, commercial and technical expertise (also supported by external technical and financial advisers). The commercial lead will be an experienced PFI/PPP practitioner from within the EFA’s private finance team.

Once preferred bidders are chosen for batches, the EFA said they “will need to work up the solutions for the subsequent schools very quickly… to ensure that the programme is achieved”.

Options to be considered in the case of delays, will include commencing enabling works under an Early Works Agreement on schools that are ready; this will be decided on a batch-specific basis.

It is intended that the successful legal adviser will be asked to advise on the first four batches of schools to be released to market as well as providing some programme level advice. The release of projects is likely to be staggered and the precise timing and structure of this release is still being determined.

The EFA has procured financial advisers to work alongside the successful legal adviser and will be appointing technical advisers shortly.

However the EFA confirmed that the successful legal adviser could be appointed prior to bidders knowing the “actual allocation of batches or their content” until the number and content of batches is finalised and announced.