Over the last 4 years there has been a substantial increase in the volume of capital funding allocated to Local Authorities, and directly to their schools in the form of Devolved Formula Capital.

The Government and the County Council have indicated that they expect this additional capital funding to be expended on important priorities and in particular those which will contribute towards raising standards of pupil attainment by removing barriers to learning. In turn it is expected that priorities will be identified on the basis of premises data, the condition, suitability and sufficiency of pupil places, as well as national and local priorities for increasing attainment.

The County Council, as the LA for Leicestershire, is required each year to compile a statement of priorities for capital expenditure on education buildings for the next 3 years. The document that follows is a Statement of Priorities for the period 2004-2007. It sets out the vision of the County Council and the priority it has accorded to raising educational standards in Leicestershire. It then shows the contribution that the capital programme will make towards the realisation of that vision and government priorities. The importance of partnership is emphasised in delivering improvements to school premises and maintaining them in good order so that they are available for use. Priorities for the next 3 years are identified together with those it may no longer be possible to pursue, given the inordinate pressure that the urgent replacement of five High Schools will exercise over the period 2004-2007. All five schools have a similar structural design, termed Intergrid, and their retention is no longer viable.

The diverse capital resources available to the LA are detailed, and the ways in which the County Council tries to ensure that they are expended to achieve best value for money by joining them together to achieve strategic objectives. The role of Devolved Formula Capital is noted in the context that it is likely to double by 2005-2006, relative to 2002-2003.

The prime aim of this document is to inform schools of the LA’s plans for capital expenditure so that they can plan their own development plans accordingly. The Education Department plans to increase help to schools in this context. A second aim is to reassure central government that the County Council, as the LA, is a competent authority in terms of resource management and ensuring that capital funding is appropriately targeted.

Leicestershire County Council’s corporate vision is to listen to the views of Leicestershire people and, by working with them, ensure that they enjoy the quality of life which they expect: to live in a County which is safe, healthy, attractive and prosperous.

In the context of that vision the County Council in July 2003 approved a revised Medium Term Corporate Strategy focussed on six corporate objectives. Each of these is a high priority issue for the County Council and one in particular relates directly to school standards, and most of the others relate to relevant context and processes. They are:

In terms of Achieving Excellence in Education and Learning, the County Council has placed in the public domain a statement of the priorities it seeks to progress to raise educational standards together with quantified performance targets. These are shown on Pages 2 and 3. There is a clear intention and public commitment to produce regular reports that monitor progress on increasing standards of achievement. It will be noted that reference is made in the commentary to removing barriers to opportunity and enabling schools to make use of new technology wherever appropriate in order to improve teaching opportunities and ensure greater achievements by pupils. It is in these contexts that capital expenditure has the potential to contribute towards realising the County Council and the Government’s vision for increasing educational standards.

In order to achieve the strategic objectives outlined above the County Council works with a variety of partners mainly in the context of Plans, Policies and operational projects. Some of these key plans and policies are detailed in Section 2.3. Partners may be within schools and the County Council as well as external agencies. Key partners include parents, pupils, headteachers and chairs of governing bodies, diocesan representatives, other County Council services, and agencies such as the Leicestershire Skills Council, FE colleges, Higher Education and Primary Care Trusts. The ultimate aim of the County Council is to ensure that the increased emphasis of government on the educational and social welfare of the individual pupil is achieved, by seeking to bring together a supportive, coherent and challenging holistic framework. Therefore, Government priorities both generic and those related to education, will be delivered through achieving the County Council's aims.

The Education Development Plan for 2002-2007 indicates some of the processes that are being implemented to raise standards of pupil attainment. These include supporting school self-evaluation and review, with an emphasis on improving the quality of teaching, the quality of school management and leadership, raising standards for under-achieving pupils and dissemination of good practice. Emphasis is also placed on an annual audit of School and LEA performance. The 2003 Ofsted Inspection indicated the effectiveness of these services by noting that “The LEA fulfils many important functions very well, particularly in relation to school improvement where substantial improvements have been made”. Similarly, “A major strength of the LEA’s support for school improvement is the strong leadership and management of national strategies and their implementation within the Leicestershire context. They have been further enhanced by the successful early introduction of the LEA’s own Key Stage 4 Strategy, now one of the national priorities within the EDP”

Capital improvement work to schools also relates to the other objectives of the County Council identified above, in a way that benefits learners and pupils and helps to provide a quality context for raising standards of achievement. By improving the safety of school buildings and sites, in partnership with schools, the County Council is making such buildings safe for community use as well as for pupils. School redesign enables improved access and facilitates school travel plans thereby making the journey to school safer for everyone. The emphasis placed on sustainability in the design of remodelled, enlarged and new schools contributes to the reduction in waste and pupils’ understanding of sustainable technology.

Working with cross cutting initiatives to regenerate communities through combined parent/child facilities, such as Sure Start and the National Nurseries Initiative, contributes to support for communities as well as leading to excellence in Education and Learning for the young people they provide for. It will be apparent that there is potential synergy between the County Council’s priorities, that reinforces attempts to raise standards of achievement by pupils and the wider community.

1.3 The contribution of capital investment to achieving these aims.
Capital investment contributes to achieving the County Council’s priorities for educational attainment in four major ways.

1.4 Delivering government priorities through these aims including Building Schools for the Future.
The Government’s key priorities, like those of the County Council, are premised on increasing standards of educational attainment. Therefore it is perfectly feasible to deliver the Government’s key priorities through school building works, because of this congruity. Therefore the County Council is supportive of all of the Government’s key priorities and seeks to deliver them in the following ways.

A central outcome of a review of SEN provision is rationalising existing special school provision to create Area Special schools. These are schools for pupils with a range of special educational needs but in addition they are extended schools bringing together a range of agencies and act as the hub for professional development relating to SEN across a wide geographical area. The first of these is under construction at Melton Mowbray utilising a successful TCF bid, and the second is planned for the Hinckley area and is the subject of a TCF bid for 2004/05.

Other Key Local Factors
The most significant factor that may impinge on the strategy to deliver increased standards across as many schools as possible is the need to:

These two factors, although in sympathy with the AMPS philosophy of placing funding where need is greatest, are likely to exercise considerable constraints on the LEA to undertake other priority work to increase standards of attainment.

2.1 Building Schools for the Future-transforming secondary education through the refurbishment/replacement of secondary schools.
The LEA has noted that this initiative is focused on transforming secondary education rather than simply replacing/improving buildings. It is also aware that proposals need to be coherent with the provision of special education/pupil support provision. The County Council has anticipated this with its policy on Area Special Schools and Pupil Referral Units described in section 1.4 above. The creation of additional area Special schools will need to form part of the BSF proposal.

In preparation for the submission of an Expression of Interest to the DfES by the 19th December 2003 it is proposed to:

The implication of the need to complete the agreed priority of intergrid replacement and area special school development is that there will be few other major capital projects until BSF allocations are received.

2.2 Primary, Special schools and Secondary schools other than the Intergrid High Schools - ensuring that their needs are not neglected as a consequence of BSF.
Section 2.1 above has made it clear that Special schools will be included within the remit of the BSF initiative in the interests of providing a coherent service through a policy of Area Special Schools. Most of the Leicestershire’s Special Schools do not have sufficient or suitable accommodation. They are also in poor condition and not all are in the most appropriate locations. The degree to which the LEA will be able to develop primary school facilities should BSF focus attention elsewhere, will depend on whether or not the special circumstances relating to the need to replace the Intergrid High Schools have been resolved. It is likely to be the case for at least the next 4 years that the LEA funded replacement of temporary classrooms with permanent accommodation, in schools, will cease. This has been a popular priority, partly because Leicestershire has a significant number of temporary buildings, and partly because of the learning gains head teachers have identified once mobiles have been replaced. In the meantime primary and secondary schools will need to manage with their increasing DFC allocations and limited help from the LEA for urgent matters drawn from a residual Minor Works Programme.

There has been substantial progress made in the removal of temporary accommodation in Leicestershire as a consequence of the County Council's capital programmes in the period 2001-2004.

In accordance with the Local Policy Statement priority has been accorded, in general, to those schools with the highest number of pupils in temporary accommodation. Exceptions have been made where all of a school's mobiles are in terminal condition and/or external funding (e.g. S106 funding) helps to enable total replacement and additional provision.

On the assumption that the LEA has only sufficient resources in 2004-2007 for the replacement of the Intergrid High Schools, the implementation of Area Special Schools and a Minor Works programme, it will continue to progress Asset Management Planning and prioritisation for the balance of schools. It will also endeavour to make the process of prioritisation as transparent as possible, which is an Ofsted Action Point for the LEA. While this document does this to a considerable extent an annual list will be produced for all schools showing all projects in the capital programme for the new school year and major projects for the following two years. This will include block sums where priority projects are still being agreed. It will also include a list of schools with temporary buildings and their relative priority for replacement as this is of keen interest to many headteachers and governing bodies. All of these documents will be sent to individual schools and placed on the Education web-site following consultation/liaison with the AMPs Reference Group.

2.3 Capital consequences of major LEA Plans.
The LEA needs to analyse each of the strategic education plans that it is responsible for in terms of their capital consequences. These plans include:

The Asset Management Plan (AMP)
This refers to:
1). a dynamic process for identifying priorities based on the Condition, Suitability and Sufficiency of pupil places. These parameters are surveyed at regular intervals to ensure that the data is accurate and up to date.
2). The priorities identified which inform the weighting given to other priorities generated by other LEA plans/government priorities.

The School Organisation Plan (SCP) 2003-2008.
This is an annually revised statement of:

The Education Development Plan (EDP 2002-2007)
This sets out the LEA's performance targets and improvement programme for revising standards in schools. The EDP is an important source for generating LEA priorities for capital investment in schools.

Special Educational Needs Plan (SEN)
A key part of this plan is to draw up proposals for the next steps in developing Area Special Schools, setting out their role, purpose and geographic areas for special provision. This is a key Action Point emerging from the Ofsted Inspection of the LEA.

Schools Access Initiative (SAI)
This plan details the LEA's proposals to increase access to schools, for all users, in line with the requirements of the SEN and Disability Act 2001. The LEA's strategy is predicated on creating a family of cross phase schools in each area as well as adapting particular schools if there are specific pupil requirements.

In the context of the previous sections the major priorities of the County Council for capital investment in schools 2004-2007, other than the replacement of the Intergrid High Schools and Area Special Schools, are likely to be as follows. The plan to which they refer is shown in brackets).

There are other significant priorities in addition to these but which are funded by external agencies and for which the funding is hypothecated. These are significant not just in financial terms but also because of their potential impact on Government priorities. Their full range is shown in Appendix B that shows capital funding sources available to the LEA. They include an Early Years Centre at Loughborough and Coalville, at a capital cost of some £2M in total. In addition the LEA will be delivering a NOF3 sport capital programme of c£3.5M.

The priorities for capital expenditure outlined above amount to a capital programme that the LEA considers is affordable within the formulaic allocations that it understands it is likely to acquire from the DfES. Given the constraints outlined in Section 1.5 it is not possible to extend the scope of the capital programme to the extent that has been the case in the last 2 years.

2.4 Capital consequences of national initiatives.
The scope of national initiatives and the LEA’s response to them, by example, has been discussed in Section 1.4. Notwithstanding the considerable capital funding pressures on the LEA for the next 4 years it should still be possible to deliver some of these through the strategic use of the LEA’s Minor Works budget in partnership with Devolved Formula Capital which is expected to double by 2005-2006. Some such as Inclusion will be funded mainly by the hypothecated SAI, Staff Workplaces by focusing on the Teaching Environments for the Future pilot and committing the balance of DfES grant from the previous years’ allocation.

3.1 Joining up funding streams to achieve strategic priorities.
Appendix B indicates the diversity of funding sources available to the LEA. The challenge is not simply to join up funding streams directed to the LEA but also to combine them with external funding from other agencies. This requires more than accounting techniques and the diligence and industry to convince potential partners that co-operation is mutually beneficial.

Good examples of joining up funding streams to achieve strategic priorities are the LEA’s work in the context of Basic Need and Early Years provision. In the case of the former, S106 funds, LEA funds, Seed Challenge and individual school’s DFC allocations, have been used not only to provide additional pupil places but to address long-standing deficiencies in the school’s accommodation and remove temporary accommodation. Therefore by thinking strategically the LEA has radically improved the condition, suitability and sufficiency of a whole school in order to enable improved standards of attainment.

It terms of Early Years provision, targeted at areas of deprivation, this has required liaison with fund holders such as NOF, National Nurseries Initiative, Sure Start, the National Children’s Homes and Sport England. As a consequence holistic solutions to raising standards of attainment have been identified in the form of integrated family/child centres when the alternative could have been disparate provision.

3.2. Managing the risk should strategic priorities not be achieved on the expected time scale.
The major risks facing the LEA in 2004-2007 are those that could arise from a failure to secure the funding necessary to replace the Intergrid High Schools. This could result in an exponential increase in the costs of maintenance of these schools that would have to be met from existing resources at significant opportunity cost. The other major issue is the cost of replacing propped temporary classrooms. While propping renders them safe it also makes them less suitable for teaching purposes. The cost of their replacement would need to await the resolution of the Intergrid replacement.

3.3 Basic principles underlying capital investment.
Leicestershire Schools play an important part in maintaining and updating premises data that is fundamental to the continued utility of the AMP process. They do realise that there is a mutual interest in doing this given that the data set drives their Net Capacity calculation as well as generating condition and suitability surveys that are used by the LEA and DfES to allocate resources.

Section 1.3 indicated that Leicestershire has a proven track record in maintaining its school buildings. For example, the 1999/2000 CO-PROP (CORPORATE PROPERTY OFFICERS' GROUP) benchmark analysis of Leicestershire and 11 other authorities, indicated that the maintenance back log in Leicestershire was 9% of Net Asset Value compared to a group average of 17%. Priorities for maintenance are generated by a formulaic methodology approved by the AMP Reference Group. There is a Maintenance Reference Group on which headteachers, registrars/bursars and premises officers are represented. On an annual basis those schools who chose to buy-back into the LEA's School Maintenance Pool are given written feedback which details current and planned programmes on an individual school basis. The process and data are transparent and each school is aware of the resources allocated to others.

Ofsted inspected the LEA in 2003, and in the context of many positive statements about Property Services and the AMP process, indicated that further work was required. In particular on identifying a systematic process for capturing information about all projects (LEA and School funded), and a method for sharing the information with schools. This refers to the need to ensure that CAD plans, which are the basis of the AMP process, are up to date and accurate. A number of operational issues have emerged from this analysis.

Schools are expected to be responsible tenants and to discharge all of their urgent ‘ tenant’ responsibilities identified in Condition and Suitability surveys. As the Ofsted Inspection Report noted, for delegated ‘landlord’ maintenance the majority of schools, 219 out of 288, buy-back landlord maintenance from the County Council. Devolved Formula Capital (DFC) is rigorously managed by the LEA to ensure that it is appropriately targeted in line with DfES expectations.

Schools are also expected, and indeed want to, improve their learning environments. In partnership with the LEA they are encouraged to use their DFC to enrich learning opportunities through a process of analysis of need and enabling School Development Plans.

Option Appraisal.
The LEA undertakes an option appraisal of all major schemes/projects with a focus on whole life costs and opportunity costs. The most recent example of this is the decision to build a new 210-place primary school at Ravenstone in NW Leicestershire to replace two 100-place schools. This process needs to be developed and to be informed by feedback from completed projects and those in hand.

Design Standards.
The LEA is determined to raise the standards of design of new and extended school buildings and to work towards sustainable construction processes, materials and design. BB95 ‘Schools for the Future’ and the revised BB82 on area guidelines are seminal documents for the LEA as will be the DfES templates for new schools in the context of BSF. We will also seek to learn form other LEAs as well as good practice in this LEA. A new 210-place primary school proposed for Ravenstone has been designed in this spirit and benefited form feedback from CABE at the design stage.

At the conclusion of every major work the Education Department conducts an evaluation of the project with the head teacher. Emphasis is placed on whether the building is fit for purpose in terms of raising attainment, as well as the efficiency of the constructional process. This information is then fed back to Property Services in order that we can learn about what works. We intend to move on from this and in consultation with the AMPS Reference Group identify an entitlement statement for all schools involved in a major work, thereby establishing a datum point to monitor against.

3.4 Procurement and project delivery in line with best value.
This Authority’s procurement strategy for construction works has changed considerably in the last 5 years. Then all works were undertaken by the use of conventional, lowest price driven procedures. All contracts were let using JCT forms of contract, fully designed, with the larger schemes quantified and the smaller not. They were tendered competitively and let to the lowest conforming bids.

Through review, and in striving to achieve improvements in service delivery, changes were made. Contractor ‘standing lists’ were radically altered to a core of companies whose track record had proven to be of best value, and the Authority made a strong move towards the use of Design and Build as a form of procurement. These schemes were tendered against a set of performance criteria and awarded on lowest compliant bid. We then developed hybrids of this procurement route by the paying contractors to enter design competitions. Their designs were submitted against a brief, and incorporated their management fee. This produced a variety of design solutions/options and following appointment scheme costs were agreed using an ‘open book’ technique.

Approximately 3 years ago, in an effort to comply with and advance the requirements of central government initiatives (‘The Latham Report’, ‘Construction Task Force’ (Egan) and the subsequent ‘Rethinking Construction’) we moved towards partnered working. The aims were to develop long term relationships with contractors, to move away from adversarial techniques, and to strive to deliver BVFM together with setting targets for and measuring continuous improvement. We do not however, see one method of procurement as a panacea, and intend to maintain a balanced pragmatic approach, judging each specific project on its requirements.

We are, however, committed to the principle of BVFM through a process of forming alliances for large elements of our programme. We have 2 current agreements:

We are currently in the process of appointing a further partner(s) for the construction of 2 or 4 replacement high schools. These are planned as 3 or 4-year agreements with an option to extend. Final appointment is targeted for February 2004 with works commencing late in the same year. The contract value will be between £20M to £40M.

All 3 of the above agreements identify and require the delivery of recognised BVFM techniques.

Initial appointments were made by the application of a price (27%) quality (73%) assessment. These were made following the receipt of fee bids and detailed identification of how the best value criteria would be delivered.

4.0 Timescales for the delivery of priorities for capital investment.
These are shown in Appendices C and D (not yet available) and they represent the best estimate possible. The new partnership processes of procurement that are being implemented by the County Council have the potential to improve the delivery of the planned programme and cost control.

5.1 Funding sources available to the LEA.
These are shown in Appendix A in terms of funding derived from the DfES and from other sources.

5.2 Education Capital outturn figures for 2002-2003.
The outturn figure (i.e. actual spend in year) for 2002-2003 was £14.165M compared to the total resources available which were £18M. The difference of £4M was carried forward to meet commitments from existing projects into later years. Significant parts of this carry forward were Standard Grant funding with an August deadline for expenditure rather than the end of the financial year.

5.3 Education Capital Programme; estimated figures for up to 2006-2007 non-BSF.
Details of the current Education Capital Programme for 2003-2004 and provisional programmes for 04/05, 05/06 and 06/07 are shown in Appendix B. They currently show a deficit of resources relative to need because of the pressure of the Intergrid replacement programme. They will be refined when allocations are received from the DfES in December/January 2003 and a decision reached by the County Council in February 2004.

5.4 Education Capital Programme; estimated figures for up to 2006-2007 including BSF.
This LEA does not envisage securing a place in the BSF wavecommencing in 2006-2997, given that priority is likely to be accorded to LEAs with a higher incidence of deprivation and lower rates of examination success.

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