National Audit Office says the average cost of setting up a free school came in more than double what was forecast

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The National Audit Office (NAO) has urged the government to tackle the “rising cost” of free schools, after the average cost of setting one up came in more than double what was forecast.

The NAO said the Department for Education (DfE) had to “exert control to contain rising costs” and learn lessons from the opening of its first 174 free schools since 2010.

The average capital cost of setting up a free school is £6.6m – double what the DfE forecast in its original plans.

The NAO criticised the DfE for prioritising “opening schools at pace, rather than maximising value for money”.

The NAO added: “Because the programme is demand-led, there will also inevitably be uncertainty about types of schools and where they will be located.”

However the NAO acknowledged that the schools had been established “quickly” and at a “relatively low cost”.

Amyas Morse, head of the NAO, said: “It is still early days in the Free Schools programme but the Department for Education has made clear progress by opening 174 schools, many at relatively low cost.

“Despite limitations in information, it is also improving its approach with each successive wave of proposals but will need to tackle a rising cost trend as the programme continues to grow.”

Margaret Hodge, chair of Parliament’s public accounts committee, said: “It appears that the Department for Education has neglected value for money in its rush to open free schools.

“The DfE has not had a proper grip on the costs of the programme. The £6.6m setup cost per school is double what the department expected, and the department had to spend £27m on temporary premises so that children were able to start school in September.

“It has also paid almost £27m above its valuations for half the land and property it has purchased.

“The department has got to be much more rigorous about how it assesses applications for free schools and prioritises need and value for money.”