Schools built by the Private Finance Initiative are "significantly worse" in terms of space, heating and lighting than new publicly-funded schools, the Audit Commission has warned.

The finance watchdog team visited nine education authorities across England and Wales to look at the initial wave of PFI schools.

Their investigations included a trip to Wales' first ever PFI school, Ysgol Gyfun Penweddig in Aberystwyth, which cost �16.5m and opened in December 2000.

Wales has a much lower take-up rate of PFI schools than England - only around nine schools have been proposed, compared with 500 across the border.

The audit team found:

• the traditionally-built schools were on average better built and designed than the PFI schools
• there was no big difference in costs and PFI schools were not built any quicker
• some projects did not take into account risk factors, such as the cost of vandalism

The head teacher at Penweddig said he was happy with the way PFI had gone over the last couple of years, but that it was probably too early to judge.

However, some students agreed with the report's findings about the design of some schools, saying the size of music rooms could be bigger and that play facilities could be better.

The first Welsh PFI primary school, Pembroke Dock Community School, opened its doors in September 2001 as part of the next round of the initiative.

The early PFI schools have not been built cheaper, better, or quicker James Strachan

The Audit Commission refused to confirm which schools it had visited, but all were opened before the end of 2001.

Audit Commission chair James Strachan said: "PFI still has huge potential to help improve the quality of the schools in which our children are taught.

"But early experience shows that contracts need to be more tightly negotiated and that design must reflect the needs of school users.

"The early PFI schools have not been built cheaper, better, or quicker and learning from this early experience is critical."

Public

Some head teachers reported better day-to-day maintenance and toilet cleaning, while some said canteen food was better.

But they also reported that contracts were complicated and PFI meant a big workload for head teachers.

The survey also found that shortcomings in school design were common to all schools, however funded.

Wales has been more reluctant to pursue PFI schemes partly because of difficulties in attracting private investment to poorer areas.

The assembly's finance minister, Edwina Hart, signalled more reliance on public money with some private-public partnerships.

Labour MP and former Welsh Office minister Jon Owen Jones has recently criticised the assembly for not pursuing more PFI schemes.