10 SCHOOL PREMISES AND CAPITAL INVESTMENT

KEY POINTS

School land and buildings are important public assets. Governors have a range of legal and other responsibilities, depending on the category of school, for:

capital investment building projects maintaining buildings and land.

VA There are particular provisions which apply to investment at voluntary aided schools as a consequence of the Education Act 1944, as subsequently amended. These are discussed separately below.

LAND AND BUILDINGS

1. The land of community schools is owned by the Local Authority (LA). The land at VA foundation schools is owned by the governing body or trustees. Land at voluntary VC schools is usually owned by trustees, although the LA will often own the playing field F land.

2. School land is usually in freehold ownership, but leasehold interests are possible.

3. In the majority of schools procured through private finance initiatives (PFI), the construction of the buildings are funded by a private-sector contractor and their funders and are then operated and maintained by that private-sector contractor for an agreed period, typically 25 years. In these cases, it is usual for the contractor to be granted a licence to both construct and maintain the buildings for the duration of the contract; the buildings then revert to the LA at the end of the term. The LA, the governing body or the trustees, as the case may be, retain the freehold interest throughout.

4. These contracts will remain in force even if the LA transfers its interest in the school land to the governing body where it changes status. The LA‟s interest in such a case is the freehold and the provision for the buildings to revert at the end of the contract term.

5. Governing bodies will acquire the ownership of their school land where they change category to foundation status if there are no trustees. It is the duty of the LA to F transfer its interest in the land to the trustees of the school (or if the school has no 1 trustees, the governing body) where it changes category. Where a acquires a foundation (“a Trust”) and becomes a Trust school, the interest in the land will transfer to the trustees. Where there is disagreement on what land will transfer, the Schools Adjudicator will determine.

Disposal and protection of publicly funded school land

6. From 25 May 2007 the governing body of a foundation or voluntary school no longer required the Secretary of State‟s consent to dispose of surplus non-playing field land VA or school buildings which had been acquired or enhanced in value by public funding. VC F The governing body is required to notify the LA of its proposals and seek local agreement on them. Where there is no local agreement, the matter can be referred to

1 See Schedule 6 to the School Organisation (Prescribed Alterations to Maintained Schools) Regulations 2007: SI 2007/1289 (as amended).

the Schools Adjudicator to determine. (Details of the new procedure can be found in the Department for Education (DfE) published guidance available on the DfE website.)

Playing field land

7. Particular protection has been given to school playing field land. Where the VA governing body of any maintained school2 or trustees of a foundation, voluntary or VC foundation special school wishes to dispose or change the use of any surplus school F playing field land which has been acquired and/or enhanced at public expense, it will require the Secretary of State‟s prior consent, under Section 77 of the School Standards and Framework Act 1998. (Further information can be found in the Department‟s published guidance on the protection of playing fields.)

Key changes introduced by Section 63 (Schedule 14) of the

8. Schedule 14 makes a number of changes to the arrangements governing disposal of publicly funded land, and the transfer of such land to Academies (including Free Schools).

9. Part 1 of the new Schedule 1 to the Academies Act 2010 deals with LA land and continues the long-standing arrangements requiring the consent of the Secretary of State before land may be disposed of, and that the Secretary of State may instead make a scheme to transfer the land to an . The provisions of Schedule 35A to the Education Act 1996 are incorporated into the new Schedule 1 (and Schedule 35A is repealed).

10. Part 2 of the new Schedule 1 deals with land held by a governing body or trustees, and in conjunction with amendments to Schedule 22 to the SSFA, introduces new provision that the land may not be disposed of without the consent of the Secretary of State, and that he may instead direct that the land should be transferred to an Academy. Part 3 of the new Schedule 1 deals with Academy land, and again provides that publicly funded land may not be disposed of without the consent of the Secretary of State, and that he may make directions concerning the transfer of the land, including that it should be transferred to another Academy. Schedule 14 also amends Schedule 22 to the SSFA to provide that trustees are free to transfer publicly funded land to an Academy, and that governing bodies and trustees must inform the Secretary of State of the proposed disposal of publicly funded land, and may not dispose of it without his consent (under Part 2 of the new Schedule 1 to the AA he may instead direct that the land is transferred to an Academy). Section 77 of the SSFA is amended to provide that the consent of the Secretary of State is required before a local authority or school may change the use of publicly funded playing fields, even where this is connected with educational or recreational facilities. In line with other changes noted above, it is also amended to provide that where an application for disposal or change of use of playing fields is made to the Secretary of State, he may instead direct that the land should be transferred to an Academy. It is hoped that any use of these powers will be rare and that most transfers of land to Academies and Free Schools will take place by mutual agreement, as at present.

11. There are some limited circumstances in which approval has been delegated: these are specified in the Schedule to the School Playing Fields General Disposal and Change of Use Consent (No.3) 2004 Order. The governing body, or trustees disposing or changing use of the land, can award a general consent and then provide the Department with specific information. A governing body, foundation body or trustees must first notify the LA before providing the Department with the required

2 Section 77(7) has been amended by the Education and Inspections Act 2006, so as that “maintained school” now includes “maintained nursery school”.

information.

Discontinuance of a foundation or voluntary school

12. When a foundation or voluntary school is to be discontinued, the governing body, VA foundation body or trustees are required, under Part 2 of Schedule 22 to the School VC Standards and Framework Act 1998, to apply to the Secretary of State to exercise F his or her powers in relation to any land held by them for the purposes of the school which was acquired or enhanced at public expense. The Secretary of State may make a direction as to what should happen to such land when the school is discontinued.

CAPITAL FUNDING

13. Capital is allocated to LAs and to schools. It can be used to build and improve school premises and for other capital purposes, including the provision of information and communication technologies (ICT). It is allocated to schools and LAs by formulae, and expenditure priorities are determined locally. LAs and schools can also use funding from other sources, including revenue funding and prudential borrowing, to maintain and invest in their buildings and assets.

14. The major government funding streams for LAs are for maintenance and the provision of new pupil places (Basic Need). Devolved Formula Capital is allocated via LAs for schools‟ own use.

15. Maintained schools of any category may not enter into contracts which involve borrowing without the consent of the Secretary of State for Education (the Education Act 2002). In practice, because borrowing scores directly against the Department's budget and is rarely good value for money, usually permission to borrow is not given. Where there is doubt on the nature of a contract, particularly regarding leasing plans, advice should be sought from the LA.

16. The DfE relies upon LAs to prioritise how their formulaic funding is spent. Similarly, schools prioritise how they spend their Devolved Formula Capital. The normal spending rules apply: that is, capital allocations can be used only for a capital purpose; allocations for specific projects must be spent on those projects; and there are time limits within which allocations must be spent depending on the type of funding provided. Other conditions of funding may apply.

17. More detailed guidance on each type of allocation, how it is determined and how it must be spent, is available on the DfE website.

Value added tax (VAT)

18. The DfE cannot give guidance on matters relating to liability for value added tax (VAT) on investment or building projects. LAs cannot reclaim VAT on capital VA expenditure for voluntary aided schools: this is because the LA has no statutory responsibility for capital expenditure for voluntary aided schools.

INVESTING IN SCHOOL BUILDINGS

19. The Building Regulations 2010, which set standards for the design and construction of buildings, apply to most buildings in England and Wales including schools and are given legal status under the Building Act 1984. The Department for Communities and Local Government (DCLG) is responsible for setting these standards, which are mainly to ensure the safety and health of people in or around buildings, but also cover energy conservation and accessibility. The Regulations apply to the construction of new schools and many alterations of and improvements to existing school buildings.

20. The DCLG publishes guidance on meeting the requirements of the Building Regulations in what are known as “Approved Documents” (ADs). AD B (Fire Safety), AD E (Resistance to Sound) and AD F (Ventilation) refer to DfE guidance for satisfactory means of meeting the requirements of the Regulations in school buildings.

Further information on the Building Regulations, ADs and associated guidance is available on the government Planning Portal. Where an agent is employed, such as an architect or surveyor, they will ensure that school building projects comply with the Building Regulations

21. In addition to these are regulations which apply to all schools maintained by local authorities in England and Wales – the Education (School Premises) Regulations 1999 (see below). Independent schools, including Academies and Free Schools, have to meet the requirements of the Education (Independent School Standards) England Regulations 2010.

School Premises Regulations

22. This section reflects current legislation. Revised, simplified regulations will come into force in September 2012. VA VC The Education (School Premises) Regulations 1999 set minimum standards for the F premises of all existing and new maintained schools in England and Wales: that is, to community, community special, foundation, foundation special and voluntary schools. There are 15 areas of regulation applying to all maintained schools and 7 to maintained boarding schools. The regulations cover school facilities, structural requirements etc. (including environmental standards and health, safety and welfare), playing fields and boarding accommodation.

23. Team game playing fields must be provided in all schools with pupils aged eight years or older, except in Pupil Referral Units. These must satisfy the minimum areas specified in Schedule 2 of the Regulations, which are based on pupil numbers and ages.

24. Team game playing fields are defined as “playing fields which, having regard to their configuration, are suitable for the playing of team games and which are laid out for that purpose”. They may include hard games courts, tennis courts, grassed and all- weather artificial pitches. Playgrounds may also be considered to be team game playing fields, provided that they are marked out for team games, such as netball and five-a-side soccer.

The grassed part of any team game playing fields must be capable of sustaining the playing of team games by pupils at each school for seven hours per week per school during term time. Rotation to allow grass to recover may mean that the markings of team game pitches require adjustment from time to time.

25. The responsibility for ensuring that a school complies with the Regulations rests with the school‟s maintaining LA. In cases where the minimum standards cannot be met, the maintaining LA will need to make an application to the Secretary of State to relax the statutory requirement.

Making premises suitable for disabled pupils and those with special educational needs (SEN)

26. The Equality Act 2010 (“The Act”) has replaced all existing equality legislation including the Disability Discrimination Act 1995 (DDA) which applied to schools since 1996. As well as making it unlawful for a school to discriminate against disabled pupils, the Act makes it unlawful for any organisation or person that provides a

service to discriminate against disabled people.

27. The Act defines disability as when a person has a „physical or mental impairment which has a substantial and long term adverse effect on that person‟s ability to carry out normal day to day activities.‟ HIV, multiple sclerosis and cancer are all considered as disabilities, regardless of their effect.

28. The Act sets out details of matters that may be relevant when determining whether a person meets the definition of disability. Long term is defined as lasting, or likely to last, for at least 12 months.

29. Schools are required to make reasonable adjustments in relation to provisions, criteria or practices where these place a disabled pupil at a substantial disadvantage compared to pupils without a disability. The government intends that, from September 2012, schools will have to provide auxiliary aids and services as part of their duty to make reasonable adjustments where this would prevent disabled children being put at a substantial disadvantage.

30. LAs and schools are also required to prepare accessibility strategies and accessibility plans respectively for increasing, over time, the accessibility of schools for disabled pupils. This is known as the planning duty.

31. The objectives of the accessibility strategy or plan are to:

increase the extent to which disabled pupils can participate in the school curriculum; improve the physical environment of schools to increase the extent to which disabled pupils can take advantage of education and other benefits, facilities or services provided by the school; improve the delivery to disabled pupils of information which is readily accessible to pupils who are not disabled receive.

32. The Act provides for inspections of LAs and schools to cover the discharge of their responsibilities to prepare, revise, review and implement their strategies or plans, and in respect of an accessibility plan, the publication of the plan. In looking at how the needs of pupils are being met in its inspection of schools, Ofsted may also ask to see a school‟s accessibility plan. The Secretary of State for Education can intervene where an LA or school is not complying with the planning duty and can direct an LA or school to do so.

33. LAs and schools have been required to have their written strategies and plans in place since 1 April 2003 and need to be reviewed every three years.

34. Part 3 of the Act applies to the governing body of a school where, as a service provider, it makes the school sports facilities, the school hall or other school accommodation available for use by members of the public or a section of the public. A school when providing such a service must not discriminate against disabled people by refusing to provide a service to them, by offering the service on less favourable terms or by subjecting the disabled person to any other detriment, such as providing the service to a lower standard.

35. Schools, as providers of services are also subject to the same reasonable adjustment duties in respect of service users as they are for their pupils (see paragraph 31 above). This may require them to change the way they provide the service to the disabled person.

36. For more detailed guidance on meeting equality duties, please go to Section 18 or the Department‟s practical advice for Schools and Local Authorities.

ARRANGEMENTS FOR FUNDING PREMISES-RELATED WORK AT VOLUNTARY AIDED SCHOOLS

37. The arrangements for funding premises-related work at voluntary aided schools were VAVA changed by the Regulatory Reform (Voluntary Aided Schools Liabilities and Funding) (England) Order 2002.

Capital grant

38. The standard rate of grant support to voluntary aided school governing bodies from the DfE is 90 per cent. LAs have the power to help voluntary aided school governing VA bodies with their 10 per cent contributions. In exceptional circumstances the DfE has the power to pay grant at up to 100 per cent.

Further information on capital funding for voluntary aided schools is available on the DfE website.

Provision of school sites at voluntary aided schools

39. Who should provide the site for a new voluntary aided school is determined by the reasons for purchase. In cases of non-statutory transfers and non-significant VA enlargements, the LA provides the site. Where there is a competition to establish a new primary or secondary school, and the competition is won by a voluntary aided school, if the site is to be established on the site proposed by the LA, the LA must provide the site and should convey this to the trustees of the proposed voluntary aided school (Schedule 2 to the Education and Inspections Act 2006).

40. Where a site is required to implement statutory proposals for a prescribed alteration, such as a transfer of site or expansion, the duty to provide the site is on the governing body (Paragraph 40C of Schedules 3 and 5 to the School Organisation (Prescribed Alterations to Maintained Schools) (England) Regulations 2007 (as amended). However, the LA may use its powers to help the governing body in buying a site, or can provide a site or building free of charge (Paragraph 40E of Schedules 3 and 5 to the School Organisation (Prescribed Alterations to Maintained Schools) (England) Regulations 2007 (as amended).

Loans to voluntary aided school governing bodies

41. Paragraph 7 of Schedule 3 to the School Standards and Framework Act 1998 VA provides that the Secretary of State may grant an interest-bearing loan towards the cost of any initial expenses required in connection with the school premises on application by:

the governing body of a voluntary aided school a diocesan authority school trustees acting on behalf of the governing body the promoters of a new voluntary aided school.

The circumstances in which approval would be given are very limited.

Proceeds from sale of assets: voluntary aided schools

42. The arrangements for dealing with sale proceeds released as a result of a building VA project funded by capital grant are set out in the Education (Grants in respect of Voluntary Aided Schools) Regulations 1999 and the Education (Grants in respect of Voluntary Aided Schools) (Amendment) (England) Regulations 2002.

43. The above Regulations set out the arrangements whereby the sale proceeds, VA released as a result of a building project funded by capital grant, will be deducted from the governing body‟s expenditure. The DfE applies this policy in all cases where proceeds accrue, or are expected to become available, to the trustees, governing

body or promoters. More information on proceeds of sale can be found under „Sale of School Land‟ on the DfE website.

USEFUL RESOURCES FOR FURTHER INFORMATION

Her Majesty‟s Revenue & Customs (HMRC): www.hmrc.gov.uk

The HMRC VAT National Advice Service handles general telephone enquiries on 0845 010 9000. Written queries can be sent to:

Policy Adviser, CT & VAT Supply of Services & Public Bodies HM Revenue & Customs 3C/10 100 Parliament Street London SW1A 2BQ

Tel: 0207 147 0032 Fax: 0207 147 0097

WHAT LEGISLATION DOES THIS REFER TO?

The Building Regulations 2010: SI 2010/2214

The Education Act 2002

The Education and Inspections Act 2006

The Education and Inspections Act 2006: Schedule 22 and Section 77 as amended by the Act

The Education (Grants in respect of Voluntary Aided Schools) Regulations 1999: SI 1999/2020

The Education (School Premises) Regulations 1999: SI 1999/0002

The Equality Act 2010

The Regulatory Reform (Voluntary Aided Schools Liabilities and Funding) (England) Order 2002: SI 2002/906

The School Organisation (Prescribed Alterations to Maintained Schools) (England) Regulations 2007 (as amended): SI 2007/1298

The School Standards and Framework Act 1998: Sections 43–53 and Schedules 14 and 15 (as amended by Sections 41–43 and 45 of the Education Act 2002 and Section 101 and Schedule 16 of the Education Act 2005)

FURTHER SOURCES OF INFORMATION

Capital Funding guidance on the DfE website

Capital Funding for Voluntary Aided (VA) schools in England (also known as the Blue Book) guidance on the DfE website

Disposal of Playing Fields, DfE guidance

Equality Act 2010, guidance on the DfE website

Health and safety in schools guidance on the DfE website

Planning Portal, the Government‟s online planning and building regulations resource for England and Wales

The School Premises Regulations, guidance on the DfE website

The Office of the Schools Adjudicator