The delays to the Learning and Skills Council’s £5bn programme to upgrade further education colleges is a stark reminder of the reality gap between the government’s desire to accelerate public programmes and its ability to actually make this happen

As one contractor observed: “Gordon Brown is standing on the bridge pulling lots of levers, but they have no connection with the engine room.”

In the case of the Learning and Skills Council, the brakes have been applied in order to assess which schemes should go ahead amid overwhelming demand and falling receipts from land sales. In fact, though, this is part of a wider theme of the banking crisis: the breakdown of many of the funding models that the construction of public sector projects has come to rely on.

Construction of social housing has stalled because of the collapse of section 106 agreements and the fact that housing associations, which have traditionally part-funded development, cannot raise loans. Meanwhile, major PFI projects such as Building Schools for the Future (BSF) schemes, hospitals and waste disposal plants are forming an orderly if rather slow-moving queue to get signed off. The financial turmoil has made finance bonds, often a component of PFI deals, harder to come by because the necessary insurance to boost the credit rating of schemes is virtually non-existent. Fewer banks are prepared to risk 30-year loans; and some, like Royal Bank of Scotland, have scaled back their operations so that, even if credit is available, there is a shortage of people to do the donkey work. Spreading risk has become the name of the game. The £4.5bn project to widen the M25 might have involved three banks in the past. Now it’s more like 14, with all the logistical nightmares that that entails.

The flow of credit to mortgages and small businesses has had to come first on the government’s hit list, but unblocking the routes to funding public sector building is no less necessary – and it won’t be solved by this week’s bailout. While there’s a real will to get schemes moving, solutions are harder to come by. Funding PFI schemes on seven-year loans is being mooted by some banks, but this would bring its own problems. Tapping into the plentiful funds of the European Investment Bank could also be an option – it has already pumped millions into BSF projects and the M80 road project.

The £4.5bn project to widen the M25 might have involved three banks in the past. Now it’s more like 14

Ultimately, though, the Treasury might have to get out the cheque book again and, in the vein of underwriting the banks’ toxic debt, offer some sort of guarantee on loans for PFI and PPP schemes. If Brown and Darling pull the lever, the engine might just splutter back to life.

A radical remembered

A radical. A brooding genius who refused to compromise his architectural vision. Let’s face it – none of the descriptions of Jan Kaplicky, who died last week aged 71, are likely to endear him to builders very much. But the Future Systems founder’s fierce commitment to that vision made him a hero to architects. Kaplicky pursued his ideals with absolute single-mindedness, which is perhaps why Future Systems completed only a handful of buildings during his lifetime and why his final project, the National Library of the Czech Republic, looks like it will never be built (see page 16). But if such a refusal to compromise can also lead to the creation of buildings as stunning as the amorphous media centre at Lords and the bulbous Selfridges in Birmingham’s Bullring, then it deserves to be celebrated. Even some builders would agree with that.