Statement of Accounts 2011/2012 - Blackburn with Darwen Borough ...

FINANCIAL REPORT 2011/2012
6.2 Balfour Beatty Education was appointed as preferred bidder in October 2009, and the Council together
with Bolton Metropolitan Borough Council, Balfour Beatty Education and Building Schools for the
Future Investments formed the Local Education Partnership (LEP). The LEP will design, build and
maintain the schools as well as provide ICT managed services.
6.3 By 2012/13 all 3 PFI schools (Pleckgate, Witton Park and Blackburn Central high schools) will have
commenced a 25 year contract for construction and maintenance. Payments remaining to be made
under the PFI contract at 31 March 2012 are detailed in Note 39. Pleckgate High School became
operational in September 2011 and the assets used under the PFI contract have been recognised in
the Council’s 2011/12 Balance Sheet, within Property, Plant and Equipment. These assets are
balanced by the recognition of a liability for amounts due to the scheme operator to pay for the capital
investment, which appears in the Balance Sheet within Other Long Term Liabilities. Witton Park and
Blackburn Central high schools are both due for completion in summer 2012, and are scheduled to
become operational in September 2012.
6.4 Also within the BSF programme, but funded directly by the Council rather than under a PFI, are three
design and build contracts for Darwen Vale High School, St Bedes RC High School and Tauheedul
Islam Girls’ High School. The committed expenditure is estimated at £19M for the 3 schools in total,
together with additional lifecycle costs of £5.795M for Darwen Vale High School (a proportion of which
may be charged to revenue). The committed capital expenditure relating to ICT for all schools within
the programme is £7.792M.
7.0 Pensions Liability
7.1 The Pensions Liability appearing in the Balance Sheet represents the excess of the accrued pension
liabilities, assessed on a prescribed basis, compared with the market value of assets at a single point
in time (i.e. 31 March 2012). It is an actuarially calculated figure for accounting purposes, and uses
different actuarial assumptions from the full valuation of the Fund.
7.2 The liability represents the underlying commitments that the Council has in the long-run to pay
retirement benefits. The total liability of £183M has a substantial impact by reducing the net worth of
the Council as recorded in the balance sheet. However, statutory arrangements for funding the deficit
mean that the financial position of the Council remains healthy, with the deficit being made good by
increased contributions over the remaining working life of employees, as assessed by the scheme
actuary.
E HALL
Director of Finance
Blackburn with Darwen Borough Council
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