Recommendation 18

The Ministry originally assumed that it would cost £4.9 million to convert the former Medway STC site into a secure school, compared with £40 million to build a secure school from scratch.60 At the time the National Audit Office reported, the estimated costs had increased to £36.5 million (excluding £7.3 million for optimism bias), due to redesigns to meet SCH specifications required by Ofsted. The time taken to complete the redesigns was also a source of delays. The Ministry told us that it now expects the Medway secure school to cost £40 million (including optimism bias)—equivalent to its original cost estimate for building a brand new school.61 It informed us that this estimate—now signed off by 51 C&AG’s Report, paras 3.3, 3.4, 3.14 52 Q59–Q60 53 Q61 54 C&AG’s Report, para 3.12, 3.15 55 Q27; C&AG’s Report, para 3.12 56 Q86–87 57 Q24 58 C&AG’s Report, para 3.15 59 Boost for public safety as four justice bills receive Royal Assent – GOV.UK (www.gov.uk) 60 Q45; C&AG’s Report, para 3.17 61 Q45; C&AG’s Report, para 3.16–3.18 14 Secure training centres and secure schools the Ministry’s investment committee—takes into account recent inflationary pressures and supply chain disruption.62 Not withstanding these recent cost pressures, the Ministry accepts that its original estimate was significantly insufficient, especially with regard to expected construction costs. For example, it told us that it did not factor in fire safety upgrades that would be required, including upgrades to the electrical and mechanical infrastructure. It accepts that it should have done more due diligence to understand the requirements for SCH registration.63 Risks to delivering the secure schools model