AMA Research have published the 3rd Edition of its overview of the report “Education Construction Market - UK 2009-2013”, focusing on key market trends, structure and change within the primary, secondary and higher education sectors, major education contractors and procurement issues.
Over £20 billion will be invested in the next 3 years, with a new tender notice for £4 bn of work recently announced and the Government regarding education as a primary vehicle for supporting the construction industry through this particularly difficult period.
Key areas in the report:
Procurement of education work by local authorities and universities
Analysis of the Government’s major school building programmes including Building Schools for the Future, the Academies Programme and the Primary Capital Programme
Detailed analysis of capital investment in the education system, an update of construction progress and an assessment of contractors output of work in the education market
Recent funding programme changes - accelerated funding plans, procurement processes
Consortia members - design, construction, Facilities Management.
Areas of particular interest:
The Government is investing £21.9 billion of capital into the school estate between 2008 and 2011 as part of the Comprehensive Spending Review (CSR).
New tender notice for £4 billion of work in Academies sector.
Analysis of major supply chains including principal consortia formed to bid for education work
In the light of the current economic downturn, the Report also reviews the impact of the ‘credit crunch’ on the forecast capital investment in the primary and secondary education sectors and the anticipated effects on the success of the Government’s school building capital programmes
Detailed analysis of capital investment levels in the higher education sector - major building programmes at UK universities, student accommodation etc.
Key drivers and future prospects for the education contracting market - future of BSF (prospects / risks), impact of recession, Govt. actions etc
Contractors included:
Allenbuild, Balfour Beatty , Bovis Lend Lease, Carillion, Costain, Cowlin Construction Ltd, Fsquared Ltd, HBG Construction Ltd, Innisfree, Interserve Project Services, Kier, Laing O’Rourke, Leadbitter, Miller Construction, Morgan Ashurst, Nord Anglia Education Plc, Ocon Construction, Opal Property Group, Shepherd Construction, Wates, Willmott Dixon.
Key areas of coverage in the report include:-
PRIMARY & SECONDARY EDUCATION IN THE UK
Structure of the state education system in England, Scotland, Wales and Northern Ireland including types of schools in operation - also overview of the Independent Schools Sector.
State education funding in the UK, including total education spending and DCSF budgets including the early release of funds announced in the Pre-Budget Report 2008.
Analysis of DCSF expenditure by function.
THE HIGHER EDUCATION SECTOR IN THE UK
Structure and size of the higher education sector in the UK - Impact of new universities on infrastructure developments within the sector.
Key sector drivers including rising student numbers and the impact of tuition fees.
Sources of higher education funding and allocations by the major funding councils in England, Scotland and Wales.
EDUCATION SECTOR BUILDING PROGRAMMES
Value of construction new work output - output by sector in 2008 - and forecasts for 2009 and beyond.
Analysis of contractors output in the public education sector - outlook for education construction work.
Capital expenditure in the schools sector and types of capital funding.
PFI in the education sector including an in-depth analysis and update of progress under the Building Schools for the Future programme. Review of Waves 1-6 and 7-15 - leading framework contractors/principal consortia members. Future prospects for the programme.
Academics programme - March 2009 £4 billion framework - scale and timing of programme. Key framework contractors.
Prospects for the recently announced Primary Capital programme for the rebuilding & refurbishment of primary schools - less reliant on PFI funding and possibly more robust programme. Budgets, scale and timing of programme 2008-12.
Capital Acceleration package announced in Spring 2009 - allocation of funds - top 20 LAs to receive funding.
Capital expenditure in the higher education sector including the early release of funds announced in the Pre-Budget Report 2008.
University capital building programmes and developments in the student accommodation sector - key market sectors.
Review of procurement processes - LEP model, frameworks, key influencers etc.
CONTRACTOR PROFILES
Key construction companies and contractors.
Private sector consortia in education - design, construction, FM members. Framework consultants.
Contractor profiles - key contractors operating in the education market.
Additional Information
Over the last 12 years, capital expenditure on school buildings has risen from under £700 million in 1996-97 to £6.7 billion in 2008-09 and will rise to over £8 billion in 2010-11. A number of capital building programmes in the education sector are now well underway including the Building Schools for the Future (BSF) Programme, the Academies Programme and the recently announced Primary Capital Programme to rebuild and refurbish 50% of primary schools.
The Government is investing £21.9 billion of capital into the school estate between 2008 and 2011 as part of the Comprehensive Spending Review (CSR) 2007. In March 2009, the Government also announced that it was accelerating almost £1 billion of investment to enable thousands of school projects to be started in the next 12 months. Around £919 million has been brought forward, which means that overall schools capital spending in 2009-10 will now be around £8 billion - up from under £700m a year in 1997.
Going forward, the £45bn Building Schools for the Future (BSF) Programme, which is scheduled to run until 2020 will be of particular interest to new entrants because Partnerships for Schools, the body responsible for delivering the programme, has just released a tender notice for a new £4bn framework that will give up to 12 contractors a chance to win academies work under the scheme.
The National Framework for Academies could be another major source of new work in the schools sector. Currently more than half of new academy build projects are being procured through frameworks, with the remainder being delivered through Local Education Partnerships.
The Primary Capital Programme, which aims to rebuild or refurbish 50% of England’s 17,000 primary schools over 15 years, is also being launched in 2009 and will see a total investment of £7-9 billion over its lifetime and around £1.9billion until 2011.
Universities are also being urged by the government to bring forward spending plans to provide an impetus to the construction industry during the economic downturn. The Higher Education Funding Council for England is advancing £200m before next April to help get £280m worth of projects off the ground.
The current economic climate is providing an opportunity for the student accommodation sector to meet the need for accommodation through joint university and private sector development and take advantage of falling site prices and declining construction costs.
The Government’s capital programmes for primary and secondary schools have had a huge impact on education spending in the UK with an estimated £100 billion being spent from now until 2020 and the largest proportion is being spent across London and the South East. BSF accounts for £9bn of the £22bn being spent on education construction in this spending review period, which runs until April 2011.
In the short and medium-term it is the availability of funding that will be the key driver in the viability of both schools and higher education building programmes. However, the long-term nature and prevalence of large projects in BSF, the Academies Programme and the Primary Capital Programme should help boost education construction activity and help counteract output falls in the commercial and private residential sectors.
The Government is investing £21.9 billion of capital into the school estate between 2008 and 2011 as part of the Comprehensive Spending Review (CSR) 2007. In March 2009, the Government also announced that it was accelerating almost £1billion of investment to enable thousands of school projects to be started in the next 12 months.Around £919 million has been brought forward, which means that overall schools capital spending in 2009-10 will now be £7.943 billion - up from under £700m a year in 1997.
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