The previous chief executive of Building Schools for the Future spent eight stormy months struggling with the brief before jumping overboard. Tim Byles, the local authority bureaucrat who replaces him, has a different plan, a different style, and (he hopes) a different fate.
Same place, very different person. Nine months ago Richard Bowker sneered when Building asked if he really wanted the job of leading the £45bn reconstruction of every secondary school in the country. A month later he left to double his salary at National Express. His successor, Tim Byles, the former chief executive of Norfolk council, who took over in November, is sitting in a meeting room next door to where that interview took place, a minute’s walk from the Palace of Westminster.
There were always doubts about Bowker’s commitment – a few weeks after he started he was spotted going for an interview at the Olympic Delivery Authority. In the end he stuck it out for eight months. By contrast, Byles really does want to be chief executive of Partnerships for Schools (PfS), the body that is running the Building Schools for the Future (BSF) programme. It has already entailed some domestic upheaval. “I have a family home in Norfolk,” he says. “It was a major move, coming to London.”
For Bowker it was a sideways step, at best. As leader of the Strategic Rail Authority he had been one of Tony Blair’s favourite mandarins. For Byles, it is a chance to move from regional government to the national scene.
An ability to make major moves will be pretty essential if Byles is to make progress in his job. BSF was launched nearly three years ago, and so far no schools have been delivered – the first is due to open in Bristol in September. Many of the first and second waves are nowhere near reaching financial close, and the bid costs for them are running into the millions.
A change of approach
“Clearly we’re all wishing him well,” says Ty Goddard, director of the British Council for School Environments, “but he’s got to really stamp his authority on the organisation.”
Arguably, Byles has achieved that already. Bowker’s prescriptive, confrontational style brought him difficulties with councils, many of which kicked against the concept of Local Education Partnerships (LEPs), the public–private joint ventures that run the construction and operation of the schools.
PfS sought a replacement who could work well with local authorities. This is why Byles, who was chairman of the Society of Local Authority Chief Executives, got the job. As he reels off his initial achievements, it is clear that the problems of the councils have dominated his thinking. “I understand the challenges to local authorities. I don’t think that LEPs are unclear, but there is scope to improve understanding and dialogue,” he says.
He has introduced a “strategy for change”, which requires authorities to undertake a “readiness-to-deliver” assessment and sign a memorandum of understanding to qualify for BSF. The assessment looks at what the estate is like, and gauges the authority’s capacity to procure, build and operate the facilities that will replace it. This procedure was introduced when wave four of the schemes was announced just before Christmas.
Byles accepts that BSF’s “over-ambitious” first projects have not gone to plan. However, plucking out a coloured A4 sheet that tabulates the progress of the first three waves, Byles tries to demonstrate that things are improving. Hiding authority names, he points out that most of the first half of rows are highlighted in amber or red. These colours mean that they have been either slightly or significantly behind schedule in reaching outline business case approval or financial close. “There’s a slippage against original forecasts of about a year,” he admits, “but it won’t impact on the overall programme [BSF is planned to run until 2019]. It could do, but I don’t see it.”
The second half of the table is green, apart from one red and two amber schemes, suggesting most jobs are running to timetable.
What about the contractors?
A theology graduate and former champion of efficiency savings in local government, Byles embodies the virtues of both by being honest and organised. Having admitted that the early schemes have not performed well, he puts a timescale on how long it will take an authority to move from entering the programme to reaching financial close.
“Typically this will be 30 to 32 months,” he says. “Experience has taught us that authorities need to be well-prepared, which is why we introduced readiness-to-deliver. We won’t be putting forward any authorities until they pass that test.”
This number comes as a shock and is comparable with the much-criticised and time-consuming PFI hospitals selection process. In fairness, part of the added time is the result of an EU directive that introduced competitive dialogue last year; this effectively rules out the selection of a preferred bidder by making authorities negotiate with at least two private sector partners down to the wire.
Byles has been accused of not taking on board the private sector’s concerns about BSF. One industry source comments: “Has he got the balls that are needed? He’s so imbued with local authority stuff.”
Byles’ defence of the 32 month timetable perhaps bears out this criticism. “You’re dealing with 150 autonomous local authorities, each of which might be dealing with 10, 20 or 30 schools. A direct parallel with health PFI [which tends to be one hospital at a time] is not an appropriate one.”
Contractors respond by saying the bid process needs to be shortened. The lengthy negotiations mean that a single bid could reach £6m – almost double that of a traditional PFI. Byles is dismissive of the problem: “I don’t accept bid costs are too high. It’s only 1 to 2% of the value of a project. That is not unreasonable. It’s only unreasonable if you’re losing project after project.”
Defending BSF, Sally Brooks, the schools capital divisional manager at the Department for Education and Skills, told a parliamentary scrutiny committee last month: “One of the criticisms of PFI is that it is computational and that there are huge bidding costs for one-off projects.” BSF provides project after project in each LEP, rather than a one-off. But the value of a contract is unlikely to be more than £500m – this is lower than many one-off PFIs, so the bid costs are comparable.
Also, Byles readily admits that he is looking at standardisation for schools; any iconic buildings will be saved for areas in need of regeneration. He says: “I see a lot of mileage in standardising components, like toilets. Authorities are showing a greater liking for standardisation. I went to a very standardised school in Kent that was designed in the fifties. I loved it dearly and visit often.”
To Byles’ credit, he is working with architectural watchdog Cabe to ensure these components have a good basic design quality.
On the plus side
Byles has demonstrated in his submission to the aforementioned parliamentary committee that he has a grasp of some big issues – he said he had examined a recent Office of Government Commerce study into the capacity of the construction industry to ensure that there are enough resources available to build the schools.
At this interview he adds: “People talk to me about the construction skills problem and, sure, there is some pressure, but the analysis I’m seeing is that it should be containable, even though Olympics and BSF work will peak around 2011.”
He is also coming up with interesting ideas to tackle the public sector’s chronic lack of procurement skills. Byles has started exploratory talks with the Local Government Association and several authorities about exchanging procurement teams. In London, for example, authorities will be running their LEP partner competitions at different times, so if one is under-resourced another is likely to be able to lend it its procurement team.
Byles also sees an opportunity for local government to procure joint facilities: “There are lots of opportunities for sensibly planned schemes that embrace health and education – they can be joined-up.”
It’s a clever idea and would cut procurement costs. He smiles when asked if PfS would run such schemes, suggesting maybe a joint venture with health authorities. If nothing else, this shows he is ambitious for the organisation – and probably won’t be doing a runner any time soon.
Building Schools for the Future (BSF) This is the £45bn programme to renew the country’s 3,500 secondary schools. It was proposed by then schools minister David Miliband in 2003 and is a 10 to 15-year programme.
Partnerships for Schools (PfS) Owned by the Department for Education and Skills, this is the public body responsible for running BSF.
Local Education Partnerships (LEPs) The local authority and PfS each take a 10% stake in an LEP, the remainder of which is owned by a private sector consortium. The LEP is charged with running the construction and operation of the new schools in an authority area.
Who’s won what so far
Amey-led consortium called Integrated Bradford, formed of Amey, Costain, and HSBC Infrastructure, reached financial close in December 2006.
Skanska is due to open the first BSF school this September.
Taylor Woodrow-led consortium Paradigm reached financial close last June.
Sir Robert McAlpine-led consortium Aura is due to complete the first school in its programme for September next year.
Support services outfit VT Group reached financial close in November last year.
BAM PPP was appointed preferred bidder to provide the equity for the scheme back in August. Sister company HBG will build them.
Balfour Beatty-led consortium Transform Schools is due to start construction this summer.
Catalyst Lend Lease, led by Bovis Lend Lease, was appointed preferred bidder last February.
£200m Waltham Forest
Bouygues will start work on seven schools this summer.
Interserve-led consortium Environments for Learning was named preferred bidder in November last year.
Consortium led by Miller Construction will rebuild or refurbish all of the city’s secondary schools by 2012.
Laing O'Rourke and Balfour Beatty are the two contractors rebuilding Manchester schools.