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Education firm RM warns £200m worth of work at risk

RM

Last Updated at 16 Feb 2018, 16:30 GMT *Chart shows local time RM intraday chart
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Educational supplier RM Group has said £200m of projects are at risk after the government scrapped its Building Schools for the Future (BSF) scheme.

It said 14 of its BSF projects would continue as planned, but that seven were now "subject to review and may be scaled back significantly".

RM has provided classroom technology such as interactive whiteboards under the BSF initiative in recent years.

Shares in RM fell 13% in the morning but by midday were down 4.3% at 155p.

On Thursday, Education Secretary Michael Gove announced that the £55bn BSF scheme would come to an end as part of major government spending cuts.

It means that 719 school revamps already signed up to the scheme will not be going ahead, while a further 123 academy schemes are to be reviewed on a case-by-case basis.

RM chief executive Terry Sweeney said the firm would "continue to analyse the impact of the Department for Education's review and, as appropriate, update the market in due course".

Meanwhile, construction group Balfour Beatty, which has won BSF contracts with five local authorities and is the preferred bidder in three others, has said the closure of the scheme will not affect its outlook.

"It doesn't impact our order book, we anticipated there was going to be change and it was well signalled," Balfour chief operating officer Andrew McNaughton told the Reuters news agency.

"We have not been waiting for this to hit us. For some time we have been positioning the business at the markets that are going to be more important in the next two or three years. Power and energy are key to us," he said.

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