To receive the results of the three yearly review of the Whitecross PFI Scheme as agreed by Schools Forum in March 2015 (minute 201 refers) and to form a view as to whether the funding of the PFI contract remains sufficient to meet the contractual commitments without the need for additional funding at this time.

The schools finance manager (SFM) introduced the report. He explained the background to the PFI contract and reminded members of the forum of additional funding that had previously been allocated to the contract. Some savings had been made which had also contributed to managing the costs of the contract. The governors of Whitecross school had agreed not to exercise their right to claim those savings.

It was explained that payments to the PFI provider were index linked to RPIX. The report set out the current and forecast inflation figures. The original model assumed an inflation rate of 2.5% for the life of the contract. The figures in the report showed that was unlikely to be case and remodelling had taken place to reflect the higher inflation figures.

The Council had added additional funding of £55,000 for 2018/19 and this would cover current inflationary costs and the SFM did not believe that there was a need to allocate any further funding at this time. Monitoring of the contract would continue and the next review would be brought back to the forum in 2021. The SFM reminded the forum that the DfE was committed to providing funding to cover the DSG share of the costs under the national funding formula. Any increase in that part would not affect Herefordshire school budgets.

It was agreed that:

a)    No further funding was required from the dedicated schools grant at this time;

b)    A progress review be added to the forum’s work programme for January 2021.