'Saving' goes out the window
It was meant to save taxpayers $1.98 million but a massive bill for preparing a business case for two new Hobsonville schools has us forking out a cool $3.5 million.
The two schools are being built using a public-private partnership (PPP) and are costing more than a standard public sector agreement.
The Education Ministry will pay $111 million to Learning Infrastructure Partners over 25 years for the schools to be designed, built and financed resulting in a saving of $1.98m over standard publicly funded schools.
But ministry budget documents show that preparing the business case for the schools has cost $3.5m, wiping out any savings made.
Labour's spokesman on Auckland issues and MP for Te Atatu Phil Twyford says this proves that public-private partnerships for schools are a bad idea.
"The whole thing was sold as a way for the government to save money on schools. Even on the Government's own terms this has been a failure. That adds up to a significant waste of their education budget. We need the best value for the taxpayer," he says.
Education Ministry spokesman Matt Radley says the $3.5 million has been spent not only on preparing the case for the Hobsonville schools but for investigating PPPs in schools in general.
"The Ministry of Education stands by its statement that the cost of a PPP for the Hobsonville Point schools is 1.7 per cent cheaper than the cost under the traditional procurement model. The transaction costs of the first PPP will always be higher than subsequent PPP transactions because of the amount of documents that need to be prepared from scratch," he says.
New Zealand Educational Institute president Ian Leckie questions whether Prime Minister John Key will be true to his word and only go ahead with the contract if it saves New Zealanders money.
"The prime minister said PPP agreements would cost less and if it didn't, no government would consider doing it. We are really worried that this is going to take the school out of the hands of the community and put it in the hands of business," Mr Leckie says.
Construction of the primary school has begun and is expected to open for term one next year. Daniel Birch, previously at Discovery One in Christchurch, has been appointed principal.
The design for the secondary school is being finalised and construction is expected to begin in August this year.
Maurie Abraham, principal of Opotiki College, will be the principal.
- © Fairfax NZ News
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