Education / Estimated cost of new Brae school rises sharply to around £40m
THE ESTIMATED cost of a new Brae school has now reached around £40 million – nearly double the initial predictions.
Meanwhile a bid to the Scottish Government for funding a new Brae school could be submitted by Shetland Islands Council by the end of October.
The topic was raised again at a meeting of Shetland Islands Council’s education and families committee on Tuesday.
Committee chairman Davie Sandison felt there was a “serious challenge” regarding the finances but said the high estimate could represent a “worst case scenario, or an all-in scenario”.
Other elected members also expressed concern about the potential cost, but there was agreement that it was worthwhile continuing to apply for government funding.
But this funding would be in revenue only, meaning the council would need to pay for the build itself, which could be financed through borrowing.
Councillors were given an update on the progress made so far with an outline business case, with the same report due to go in front of two other meetings this month.
The prospect of a new school emerged last year, and council officers have been working on potential sites – although no decision has been made yet on a location.
There is an acceptance that the current Brae school is not fit for modern standards, with a deteriorating condition and a large carbon footprint.
There is also a lack of flexible spaces, particularly for those receiving additional support.
The primary building was built in the 70s and the secondary building followed in the early 1980s. It initially offered learning up to secondary four but in 1993 it expanded to fifth and sixth year.
The total school roll in September 2020 was 328 – 35 in nursery, 149 in primary and 144 in the secondary. It takes in pupils from across the North Mainland.
Changes to the funding model for learning estates in Scotland meant an outline business case is not yet finished, but it is almost complete.
But inflation and design standards relating to net zero, as well as other factors, have greatly increased the estimated cost following new calculations.
Learning estate manager Shona Thompson told Tuesday’s committee meeting that detailed cost estimates now sit at between £37.2 million and £39.5 million.
Early estimates stood at between £16 million and £20 million, with £17 million being established in the council’s asset investment plan to be financed through borrowing.
But a report to councillors says there is “insufficient headroom” at present to accommodate an additional £23 million of borrowing to meet the revised estimate.
The report said under the government learning estate investment scheme the council could receive revenue funding over 25 years with no capital finance available, so the council would have to cover the cost of the actual build before recouping some money over the years.
“The council will need to prioritise which capital investments it wants to take forward in the future if it is to proceed with the preferred option as currently stated,” it adds.
Finance manager Jamie Manson said he was not sure what hypothetically would be “knocked out” of the asset investment plan to make way for the new school expenditure, as much is maintenance.
But he said it could come down to “descoping” the options involved in the Brae school project.
Manson reminded councillors though that no decision has formally been made to go ahead with a new school at this stage, as it is just a preferred option as things go through the business case process.
The estimated cost of construction has also increased by 17 per cent according to indices used by the construction industry between 2017 and 2022.
“A further inflation factor of eight per cent has been assumed to extrapolate the overall impact of inflation between now and financial close of the project, expected by end of Q2 in 2024,” the report to councillors said.
If a bid is successful and the project progresses there could be the prospect of a new Brae school opening in October 2026, Tuesday’s meeting heard.
Shetland North councillor Tom Morton said in his opinion a new school was “essential”.
He praised the education received by three of his children at the school, and said it was crucial to the development of not just Brae but the North Mainland.
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