New school project could lead to huge borrowing

Ted Peskett, local democracy reporter

A council’s borrowing costs could go up by more than £160,000 a year for the next 50 years in order to cover payments for the construction of a new school.

Vale of Glamorgan Council cabinet members were told at a meeting on Thursday, May 1, that it will cost £63.9m to construct a new building for Sir Richard Gwyn Catholic High School in Barry.

The estimated cost of building the new school was originally £59m.

Most of the money will come from various grants and Welsh Government funding, but £3m will have to be borrowed by the council.

Vale of Glamorgan Council’s cabinet member for education, arts and the Welsh language, Cllr Rhiannon Birch, said: “This is over the £59m construction costs we’d anticipated, but there is opportunity to bring the figure down when undertaking value engineering through project delivery.

“Morgan Sindall will competitively tender the scheme to their supply chain once the design is fully complete.

“Once this stage 4 design has been completed they will be then in a position to receive accurate prices from their supply chain.

“As we all know, all supplies… building materials and even the cost of importing them and paying workers or skilled workers is increasing all the time.”

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Tenders

Vale of Glamorgan Council invited tenders for the construction of St Richard Gwyn High School in May, 2024.

The successful bidder, Morgan Sindall, provided the council with the second stage proposal for contract which includes the costs for all the work needed to be done as part of the project.

Morgan Sindall issued the tender to subcontractors and the total for all the work needed that came back from these was £63.9m.

The financial commitment that will need to come from the council adds up to £8.987m, but £5m of this will be in the form of a net zero carbon grant that’s 100% funded by the Welsh Government.

Borrowing would result in a total revenue repayment of about £162,000 per year for the next 50 years.

Cllr Birch said there is no financial commitment from the council at the moment.

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Full business case

Cabinet members agreed at Thursday’s meeting to allow a full business case for the Sir Richard Gwyn High School development to be submitted to the Welsh Government by May 2, 2025.

Sir Richard Gwyn High School is the final school earmarked for development under Vale of Glamorgan Council’s 21st Century Schools Programme.

The leader of the council, Cllr Lis Burnett, said: “Whenever we’ve opened a new school, we have always wanted to say to children that they are worth every pound that we spend on their new school and we hope it is an investment in their future.”

She went on to say there was a big discussion on the school and whether the council should put off its redevelopment until it could be afforded.

Cllr Burnett added: “We felt that this was our final secondary school to renew in just over 10 years and we felt it had to go forward.

“We hope the people of the Vale will agree that an investment of £162,000 a year for the next 50 years is just what these children are worth.”