The GSD has noted that the Government is "now resorting to renting  buildings as it apparently no longer has the money to build"and has asked Government to provide "full details" as to what the terms of the deal are.

A statement from the GSD follows below:

The GSD has, as highlighted in the budget debate, noted that the Government is now resorting to renting  buildings as it apparently no longer has the money to build. In its usual manner Government again seeks to  spin matters away from this core truth by suggesting that the deal it has worked out with these private  developers is commercially sound. In the case of the new St Mary’s school project the renting of schools by the Government is unprecedented.  

In 2019 the GSD raised questions on value for money and conflict of interests on the St Mary’s deal that the  Government were entering into. At the time the then Minister for Education, Gilbert Licudi, said that the price  that had been negotiated to rent the school was £29.50 per square foot. The Government then in answer to  questions from the Leader of the Opposition could not give a precise figure for the rental because they said  they were unaware of the precise area. It has now confirmed that the school will occupy 2,600 square metres  and have an external area of 1,000 square metres beyond that. 2,600 sqm is approximately 27,986 square feet.  Using the rental per square foot that Mr Licudi said Government had negotiated this would amount to a rental  in excess of £825,000 per year and that does not even include the external area. It also does not take account  of any additional sum which the Government may be paying given the information they provided Parliament  in 2019 that they would pay an extra £4 per square foot rent if the developers fitted out the school at the  Government’s request. Is that extra sum being paid?  

The key questions are what exactly is the rental being paid and for how long is this commitment to rent at this  price? What is the length of the lease? It is obvious from how the then Minister gave information to Parliament  in 2019 that they envisaged a long lease well in excess of 21 years. The arrangements could therefore easily  amount to millions of pounds over the length of the term for the benefit of these private developers. Is that  value for money for the tax payer?  

Additionally, the current Minister for Education - Mr Cortes, in announcing the project on GBC said that the  developers would be making the capital outlay and that there would not be a capital contribution of the  Government “at this stage.” What did he mean by that? Will there be a payment or capital outlay expected in  the future?  

The Government needs to come clean and provide full details as to what the terms of the deal are.  Roy Clinton the GSD Shadow Minster for Public Finance stated the following:  

“In the 2021 Budget Debate I highlighted how the Government was now resorting to renting building such as  for GBC and now St Mary’s school as they have run out of money. This is a pattern which seems set to continue  and is not something the Government should be proud of. We had raised previous questions on value for  money of this project as far back as 2019.  

I guess the Government would mortgage all our schools if they could, but instead are now renting the building  from private developers who will no doubt make a nice return on their investment at taxpayers’ expense.”