A NORTH-EAST school has hit out at the Government after a legal wrangle over private finance initiative (PFI) repayments blocked its bid to break free from its local authority.

Darlington Education Village – a federation of Haughton secondary, Beaumont Hill special and Springfield primary schools – applied to become an independent academy a year ago.

But the bid ran into trouble when the bank that financed the original construction of the village, under the PFI, refused to give the goahead.

The bank raised fears that Darlington Borough Council does not have the legal power to make the annual £4.25m repayment on behalf of an independent academy.

Extraordinarily, the banks behind 16 PFI schools across England are still seeking a further legal opinion – even after the Government changed the law to try to break the impasse.

The Department for Education (Dfe) is now using taxpayers’ money to fund that legal action, in a bid to secure the switch to academy status early next year.

Kevin Duffy, vice-principal of the Village, last night warned the federation was losing ground in a race to secure the extra freedoms that flow from being an academy.

Mr Duffy said: “It’s really, really frustrating. We are stuck in treacle and we can’t seem to go forward.

“We have been trying to get across the line for a year, having been told that converting to an academy would take only three months. Now it could be held up indefinitely.

“We have watched many, many other schools converting, even though they put in their applications way behind us. From January 1, we will be the only secondary school in Darlington that’s not an academy.

“The question I have is whether the problem was unforeseeable, or was it foreseeable – and someone just missed it?”

The controversy has reached Westminster, where a Labour MP tabled a parliamentary question to find out what action the Dfe was taking.

In reply, schools minister Nick Gibb said a number of banks were “withholding their consent to PFI schools becoming academies until these concerns are resolved beyond doubt”.

However, he also revealed that 24 PFI schools had successfully converted to become academies, because their banks had been “happy to proceed”.

Mr Gibb insisted: “Local authorities do currently have the power to make these contractual payments on academies’ behalf.

“However, we recognised the demand for this to be clarified more explicitly, which is why we have now amended the Academies Act accordingly.

“We hope and expect that the affected schools will now be able to proceed with their applications to convert to academy status.”

Mr Duffy said the earliest Darlington Education Village would be able to switch was February 1 – but only if the legal row was settled.

Jenny Chapman, the Darlington MP, said she was keen to see the dispute settled, adding: “The school is very keen to become an academy and I have always supported them.”