Public-private deal puts onus on builders to maintain schools

Four new schools are being constructed under a public-private partnership (PPP) that will make the builders responsible for their maintenance over the next 25 years.

The four schools in counties Louth, Clare, Tipperary and Cork are the first projects being delivered under a €1.4 billion PPP stimulus package previously announced by the Government.

Other projects include the Dublin Institute of Technology’s next phase of campus development at Grangegorman, Dublin, and a series of primary care centres. Under the scheme, building contractors pay for construction of schools through a loan which is repaid in instalments from the Department of Education.

A “legacy” payment is made by the department after 25 years on the basis that the buildings are in a suitable condition to be then handed over to the State.

Bank support

BAM Ireland won the contract for the project, which is supported by AIB Corporate Banking, German lender KfW IPEX-Bank and the

National Development Finance Agency

(NDFA).

Minister for Education Jan O’Sullivan said the project was cost-effective “insofar as we pay over a long period of time” and “also the fact that the maintenance is part of the programme”.

Minister for Public Expenditure Brendan Howlin said: "There is a constraint on the amount of money we can provide through the exchequer directly.

“We’re still spending about €3.5 billion annually on direct exchequer spend in the education sector. We’ve looked beyond that to see where we can have PPPs where they are cost-effective.

“It is not simply providing the building and handing it over. It is about maintaining the building for a period of 25 years.

“It has allowed us to greatly expand the capacity of the State to provide for the demographic needs of children in the education sphere,” he added.

Essential deficits

“In a time of constraint, we’re looking at all avenues . . . to meet essential deficits that the State has in infrastructure.”

The four schools, catering for 2,950 pupils, are: St Mary’s College Dundalk, Co Louth; St Joseph’s Secondary School, Tulla, Co Clare; Comeragh College, Carrick-on-Suir, Co Tipperary; and Skibbereen School, Co Cork.

They will bring to 22 the number of schools delivered under the PPP model.

The NDFA, which is responsible for monitoring the construction stage of the schools until completion, said it was especially encouraging to have seen strong interest from international investors and funders in the project.