Police launch probe into £380m North Ayrshire schools PFI deal for a second time

North Ayrshire Council
North Ayrshire Council

A POLICE probe has been launched into a controversial private finance deal to build schools – for the second time.

Four schools in North Ayrshire were built using the Private Finance Initiatives (PFI) but concerns over the bidding process have sparked the investigation.

The £380 million project was signed in 2007 and attracted two bids but campaigners fear council chiefs only considered one to “allow the pretence of competition”.

This is because the firm in question was a newly-formed company with no accounts, offices or any track record in construction.

A complaint about the bidding process was made in 2006 and the Crown Office instructed the then Strathclyde Police to carry out an investigation but concluded there was no evidence of criminality.

Last month North Ayrshire councillors authorised the local authority’s chief executive Elma Murray to write to Police Scotland to ask them to reopen the investigation.

Police Scotland said: “Police Scotland can confirm the issues raised by North Ayrshire Council are currently being reviewed by the Economic Crime and Financial Investigation Unit.”

Former independent MSP Campbell Martin, who has made a documentary about the issue called The Only Game In Town, said: “There was no ‘genuine competition’. In fact, there was no competition whatsoever.”

Four schools – St Matthew’s Academy, Greenwood Academy, Arran High and Stanley Primary – were built under the Labour-led Scottish Executive in 2007.

The first and winning bid for the project was from the First Class Consortium which included big-hitters in the PFI trade such as Mitie and Hochtief.

A second bid came from CES, which was registered to the address of an accountant in Fife.

At the time, campaigners raised concerns about the viability of the second bidder as it had filed no accounts and had issued share capital valued at just £2.

It later emerged that in its bid document, CES, had indicated it was a subsidiary of a Singapore-based company, CPG Corporation ,but this firm denied it had anything to do with CES.

CES has now been dissolved.

A North Ayrshire Council spokesman said: “We will cooperate fully with Police Scotland during their investigation.”