A private school in Old Woking, Surrey, is facing financial challenges as it seeks to delay repayment of £2.4 million owed to the now-bankrupt Woking Borough Council.
Greenfield School, which borrowed a total of £13.3 million from the council, has informed the authority that it currently lacks the funds to settle the debt due on 25 November.
According to council documents set to be reviewed on Thursday, there is doubt that Greenfield School will be able to meet its upcoming financial obligation.
The papers state: “The school may not be in a position to do this.”
These loans were spotlighted in the Public Interest Report published on 5 November, which detailed the financial missteps leading to Woking Borough Council’s bankruptcy.
The Grant Thornton report indicated that the council had borrowed heavily to fund regeneration projects and support its struggling companies in repaying interest.
Some of these funds were subsequently loaned to Greenfield School, with the rationale that lending to the private sector would alleviate pressure on local state schools.
The loan arrangement has sparked controversy, with calls for a full inquiry surfacing in October. Greenfield School, which charges annual fees of £17,010 per student, is currently paying a modest 1% interest rate on the loan.
The council’s meeting papers revealed that the school managed to repay £851,098 on 11 October following the sale of some assets.
The report notes: “No payment is required by the school until 25 November, and there has been no confirmation that the payment will not be made.
“However, the school has approached the council advising they do not currently have funds to make full payment and have discussed re-financing options.”
Possible solutions being considered include further sales of school properties, a process that council documents estimate could take up to two years, if successful.
Another option is for the council to take ownership of Greenfield’s assets.
The report presented to the council recommends allowing Greenfield School additional time to arrange payment.
Greenfield School has declined to comment further, stating that all necessary information is already included in the council documents.
This situation underscores the complex financial entanglements that contributed to Woking Borough Council’s financial downfall, raising questions about the management of public funds and the risks involved in lending to private entities.
