£4m payout over botched school

The PFI project for the Stepps Primary School and Cultural Centre

in Glasgow has been beset by defects (Image: Jamie Williamson)

Private company Transform Schools pursued a civil action on behalf of North Lanarkshire Council and contractors Balfour Beatty have now been ordered to pay up.

The PFI project for the Stepps Primary School and Cultural Centre in Glasgow has been beset by defects.

Building giant Balfour Beatty has been ordered to pay more than £4million in damages over a botched PFI project.

The firm was given two weeks to pay up after major drainage problems at a newly- built school and adjoining community hub.

Defects included a collapsed drain, blocked pipes, sewer problems and debris left in pipework.

The civil action was pursued on behalf of North Lanarkshire Council by private company Transform Schools, who supervised the building of Stepps Primary and Cultural Centre near Glasgow.

Transform was hired by North Lanarkshire in 2007, under the controversial PFI to oversee the construction of 17 similar projects.

Balfour Beatty was then contracted to do the work.

But a judge in the Court of Session in Edinburgh has ordered Balfour Beatty to pay back £4million in a judgment published on February 18. It has until Tuesday to hand it over.

Transform raised the action with an adjudicator after a drain collapsed at the cultural centre last June, requiring costly emergency repairs.

The adjudicator ruled that Balfour Beatty should pay Transform the sum.

Transform then raised the action for enforcement after the construction firm refused, claiming the adjudicator’s decision was a “breach of natural justice”.

However, Judge Lord Ericht upheld the adjudicator’s decision.

He said: “The latent defects concerning the foul drainage are latent defects as defined in the contract.

“The defenders are liable to the pursuers damages of £4,029,574, in respect of costs and direct losses incurred as a consequence of these latent defects.”

Stepps Primary School and Cultural Centre – which runs school after-care and toddlers’ groups – was built in 2007. Transform has the contract to maintain the building until 2039.

North Lanarkshire Council said: “We are working with Transform Schools to address the drainage issues beneath the school building.”

Transform Schools was set up 20 years ago to build and maintain facilities in the UK under PFI contracts.

Balfour Beatty originally owned Transform Schools but sold it in 2014 to a private investment firm for about £42million. In 2018, Balfour Beatty was ranked as the biggest construction contractor in the UK.

Audit Scotland last month said PFI contracts must be subject to greater scrutiny. They said the public sector has paid £13billion for 136 projects such as schools and hospitals since 1998 and will pay a further £27billion until 2048.

Balfour Beatty said: “As legal proceedings are ongoing, it would be inappropriate to comment further at this time.”

Source: Daily Record