A major school re-building programme involving several Thanet schools remains on track and will not be derailed by the credit crunch, say county education chiefs.

Kent County Council is embarking on a huge refurbishment and redevelopment of its secondary schools under the Government-funded Building Schools for The Future (BSF) initiative.

It recently signed a £600million contract for the first phase involving ten secondary schools in Thanet and Gravesend.

The county council is now in the first stages of seeking a contractor for work on a further 25 schools in the two districts and Swale.

But there are fears the massive programme could become a victim of the credit crunch, with the construction industry finding it increasingly difficult to secure loans from banks.

Construction industy bosses recently warned a number of private companies involved in BSF were struggling to get the money needed to complete projects.

Cllr Mark Dance (Con), KCC’s cabinet member for school operations, said he was optimistic Kent would not be affected and claimed the downturn in the housing market could prove an advantage.

"Because of the situation in housebuilding, I think there will be more players coming to the table. Companies will swap from house-building to procuring Government contracts," he said.

The scheme was helping "prop up Kent’s construction industry", he added.

KCC has been told future BSF contracts it lets should be sub-divided into smaller ones worth about £100million. The Department for Children Schools and Families believes the size of some BSF contracts is too big and inhibits smaller companies from bidding for them.

Tim Byles, chief executive of Partnership for Schools, the agency delivering BSF, said banks were less keen loan the sums they had in the past.

"Many are only prepared to lend £30 million to £50 million rather than hundreds of millions," he said.

Meanwhile, it has emerged Land Securities Trillium, which won the initial £600 million contract from KCC, has been sold off to another company, Telereal.

Cllr Dance said the sale would not impact on the building scheme.