Ayrshire College's Kilwinning campus has been named as one of 11 public buildings across Scotland which are facing huge payments to bring them back under state control.
Scores of buildings, such as schools, have been built across Scotland using the Private Finance Initiative (PFI) model where firms construct and maintain buildings for an annual fee.
A BBC report on Friday revealed 11 of them - including the college's Kilwinning site on Lauchlan Way - will need to pay the PFI provider a fee or market value for the property if they want to take full control of the building when the contract ends within the next five years.
Ayrshire College is the only one in Scotland which makes PFI payments, inheriting the financial burden when the campus was transferred from James Watt College.
A spokesperson said today: "Ayrshire College can confirm there is a final payment required at the end of the Kilwinning Campus PFI contract in August 2025.
"The Kilwinning Campus PFI contract was a development by James Watt College in 1999-2000, with Ayrshire College inheriting the contract at the point of merger in August 2013.
"A final decision has not yet been taken on the PFI contract by the Board of Management. The college continues to work with key partners in carrying out the necessary due diligence surrounding our final options."
The Kilwinning site is one of three operated by Ayrshire College, with the others in Ayr and Kilmarnock.
It's not clear exactly how much of a payment the college will be liable for - though in 2018, its officials warned the institution would have to make savings of £2m per year for six years to be able to afford the payments.
According to the BBC the other Scottish buildings facing a 'buy back' clause include five high schools in Falkirk, the Larkfield Day Hospital in Inverclyde, and Police Scotland's training centre at Jackton near East Kilbride.
PFI was introduced by John Major's Conservative government and meant the upfront cost of building such as schools and hospitals was taken on by the private sector in return for repayments to cover construction and maintenance.
But the number of PFI contract deals soared under Tory Blair after Labour swept to power in the 1997 UK general election.
The contracts with "buy back" clauses were among the first wave of PFI deals signed by the Blair government.
Cunninghame North's SNP MSP Kenneth Gibson said: “Even 16 years after they left office in Scotland, Labour’s wasteful Private Finance Initiative (PFI) Legacy is costing Scotland billions.
“It is a disgrace that throughout Scotland taxpayers have to shell out over one billion pounds each year - money lost to public services – while PFI contractors’ rake in huge profits.
“In North Ayrshire alone, over £400 million will be paid to cover the cost of four schools that cost only £83 million to build. This cost increase with every rise in interest rates. And North Ayrshire Council won’t even own the schools when the contracts terminate in 2037!
“James Watt College was saddled with a £50 million PFI repayment burden following a £7 million investment in Kilwinning Campus, which Ayrshire College subsequently inherited following regionalisation.
“Recent revelations that the public purse will have to pay the private PFI provider a fee to take control of Kilwinning Campus once the contract ends, is just the latest twist in the scandal of Labour’s policy of trying to buy votes by paying through the nose for capital projects future generations will still be saddled with.
“Only two years ago, the PFI consortium behind East Ayrshire Community Hospital in Cumnock was paid £12 million by NHS Ayrshire and Arran in in 2021 to be able take over their own facility!
“While successive SNP Scottish Government’s buyouts have gradually been unpicking Labour’s toxic legacy, Sir Keir Starmer’s party don’t seem to have learned the lesson with their Shadow Health Secretary foe England, Wes Streeting MP, publicly backing the use of the private sector to provide NHS treatment.”
West of Scotland Labour MSP Katy Clark told the Herald: “The PFI buyback clause at Kilwinning is scandalous and a reminder of why such schemes are terrible value for money, essentially just wasting taxpayers' money to line the pockets of profiteers.
“I have been a long term campaigner against PFI, including when I worked for the UNISON trade union and was a backbench MP, and I believe all parties need to learn the right lesson from this fiasco.
“Even the UK Treasury now describes public-private partnerships as inflexible, overly complex and a source of significant fiscal risk to Government. And yet, the Scottish Government continues to waste billions on such arrangements for public infrastructure projects.
“That's why I'm involved in cross-party work to develop alternatives. We need to deal with past PFI failures and move towards models that put quality, value for money and accountability at their heart.”
Unison Scottish secretary Lilian Macer, Scottish secretary of the Unison trade union, told the BBC that the buy back clauses were a "scandal" and said: "Once you pay up your mortgage you don't then have to pay a penalty clause to own your home. At the very least it should be the same for public services."
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