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Primary school building suspended | |
(about 2 hours later) | |
Building work on three Aberdeen primary schools has been suspended following a funding gap caused by the collapse of an Icelandic bank. | |
The £120m 3Rs scheme to redevelop and build the schools had been backed by Landsbanki, which was seized by the Icelandic government in October. | |
Construction will continue on four other schools after city councillors agreed to a £5m bridging loan. | |
The consortium behind the project is trying to find alternative finances. | |
Corporate director for resources management Gordon Edwards said: "We have worked hard to come up with a compromise to help safeguard the integrity of this project. | |
"We will ensure appropriate conditions are put in place to protect the loan." | |
Short-term solution | |
Councillor Kevin Stewart, chairman of the 3Rs project, said: "I am grateful that the commitment agreed to this unanimously and I hope the long-term financial situation can be resolved sooner rather than later." | |
He said the council had been consulting with the Scottish Government which was happy with the agreement. | |
The 3Rs project involves the building or redevelopment of eight primary and two city secondary schools. | The 3Rs project involves the building or redevelopment of eight primary and two city secondary schools. |
Work had commenced on all but three, but the Danish-based construction company Pihl issued a suspension notice on work after its September invoice was not paid. | |
An interim deal was reached with the new Landsbanki, which agreed to release £1.25m for the next six months. But this was not enough to keep the school building work on track. | |
The consortium behind the project requested an emergency meeting with the local authority to ask councillors to consider a bridging loan. | |
It was thought the Urgent Business Committee would be asked to provide anything between £3m and £17.5m. | |
The council said construction on the two academies, Bucksburn and Cults, plus Airyhall and Heathryburn primaries would continue and was expected to be completed on schedule. | |
But completion of the three of the primaries where work was suspended is expected to be delayed by six months. |
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