We read about the dreaded affordability gap; have local authorities really tied themselves into long-term project agreements that they can no longer afford (or, perhaps, could never afford)?

Perhaps not.  Putting the contracts together and obtaining all relevant approvals is really not so hard (although increasingly local authority politics is making it less of a standard-form exercise). 

The hard work starts when the conversion kicks in.  Managing the project agreement which the academy has, for all intents and purposes, inherited from the local authority is the really important bit.

The new academy has, through the schools agreement, been given enormous power to make sure the PFI contractor does its job properly.  If the PFI contractor does not perform, the academy can insist on the local authority enforcing its rights under the project agreement.  For a prudent head teacher wanting to save money this would mean deciding that poor service results in no payment. 

But this doesn't happen often enough.  On too many projects, the unitary charge in the project agreement is treated as a rent that gets paid as a matter of cause.  No questions asked.  It is up to the academy (and head teachers in particular) to ensure that it is receiving the service it is paying for.