- guardian.co.uk,
- Monday July 05 2004 16:14 BST
The future of dozens of schools currently being built by the private company Jarvis was in doubt today after the company suffered a series of setbacks on the stock market.
The Liberal Democrats have written to the education secretary, Charles Clarke, demanding to know what contingency plans are in place for schools and universities being built and run by the company.
Dr Vincent Cable, the Liberal Democrat Treasury spokesman, has warned of "chaos" for some schools and universities should the company declare itself bankrupt. Dr Cable has written to Mr Clarke, demanding to know what will happen to the Private Finance Initiative (PFI) schools, colleges and universities that are engaged in with the company.
Jarvis, which is involved in dozens of schools and university facility building programmes, suffered a 30% fall in share price today, on top of a 50% slump last week after it admitted that it had broken banking rules.
Dr Cable said: "Dozens of schools and universities around the country will be left in the lurch if Jarvis goes bankrupt.
"They are relying on Jarvis to provide vital services, managing university student accommodation, building and maintaining new school classrooms and other facilities.
"In my own constituency alone, I am concerned that if Jarvis does go bankrupt, this will result in a serious disruption of services and much needed refurbishment for local schools. Setting up new contracts with new providers while extricating schools from their current contractual arrangements with Jarvis and any receivers called in could be a very lengthy process."
He added: "Parents and teachers need urgent clarification that there will be no disruption or crisis within schools or universities if Jarvis is unable to continue operating."
Kat Fletcher, the president of the National Union of Students (NUS), said of the reports: "This is extremely worrying, in that Jarvis are one of the main companies involved in the building and management of new student properties. It may also be a worrying precedent.
"How long will it be before other private providers suffer the same fate? We hope that this does not lead to acute accommodation shortages at the start of the new term."
A spokesperson for the Department for Education and Skills (DfES) would only confirm that there are currently 19 PFI deals with Jarvis, covering 120 schools. Ten out of the 19 are already operational while the others are still under construction.
She added: "Whilst individual PFI procurements are the responsibility of the local authority concerned, the DfES maintains close contact with local authorities throughout the procurement process, and continues to monitor the progress of projects after contract signature has been reached."
Jarvis released a statement saying that it was "business as usual" and that the company had the support of the banks.
"This does not affect our ability to continue to deliver those projects we've started and will not affect projects we are currently bidding for."
In spring 2003, Jarvis was awarded a government contract to help turn around failing schools, despite having no education experience.
Most PFI projects have now been replaced by the government's Building Schools for the Future programme which promises to refurbish or rebuild most schools in England over the next 15 years.
