A quarter of North Ayrshire’s council tax is spent on PPP school payments. Repayments will total £443.4 million by 2038.
North Ayrshire Council must pay a lot this year. The council owes £16.07 million for four schools. These schools were built almost twenty years ago and include Arran High, Greenwood Academy, Stanley Primary, and St Matthew’s Academy.
That payment takes up 25% of their council tax. The council collected £64.48 million total this year. Those four schools cost only £83 million to build, but now, repayments will total £443.4 million and continue until 2038.
Gibson called it a “build now, pay later” scheme. Private firms provided the initial building funds. Councils now make annual payments over many years to the private companies.
PPP schemes are contracts between public and private entities. They build infrastructure like schools and hospitals. Taxpayers cover building and maintenance costs. This system began in 1992, and Labour continued it, Gibson explained. Risks fell on taxpayers, he claimed, while private sectors made large profits, he said.
Scotland’s PPP costs will peak next year and are expected to reach £1,143 million. This limits spending on needed public services too. Council taxes are thus much higher.
The SNP stopped new PPP projects and used a non-profit model instead. Private profits were capped at five percent. Surplus cash went back to the public sector. This saved taxpayers about £7,735 million. Gibson wants Labour to reject PPP entirely.
Labour’s Michael Marra admitted these contracts are burdensome. They affect taxpayers across Scotland, he stated. The Chancellor confirmed no return to PPP.
A council spokesperson spoke about schools created by PPP. The contracts faced rigorous checks when made and have processes ensuring the contractors deliver. The council always wants the best education, and pupil schools must fit 21st-century requirements.
Scotland still owes much on PPP projects. Over £12,744 million must still be paid from 2025-26. Local authorities owe £7,281 million alone, that’s more than twice the council tax collected; Scottish council tax collected last year totalled £2,897 million.