Tag Archives: budget

SEND funding switched to schools?

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Has the funding of SEND just become even more complicated for 2026-27? Under the arrangements announced by the DfE, cash has moved from the High Needs Block to other funding streams within the Dedicated Schools Grant.  Dedicated schools grant (DSG): 2026 to 2027 – GOV.UK

Now I am no expert in schools funding, and the labyrinthine calculations employed by the DfE in deciding both the size of the cake and its distribution.  However, it does seem as if all local authorities will see their High Needs Block funding stream reduced in 2026-27 when compared with 2025-26. As seem usual, some London boroughs have been less affected by the change than other upper tier authorities, with 10 of the 20 local authorities with the smallest percentage decrease being London boroughs. There are no London boroughs within the top 20 authorities with the largest percentage reductions, with the highest ranked London borough coming in at 23rd place.

Oxfordshire, where I served as the Cabinet member until May’s elections, has seen a decline of 18.75% in its High Needs block. That decline ranks it in the top 25 local authorities for the largest reductions in their High Needs Block. Hopefully, the cash has been distributed to schools, but the Schools Block for the County has also reduced, by around £5 million – effectively a standstill. No doubt the reduction is due to falling pupil numbers on a formula that is heavily driven by pupil numbers. The implications for schools faced with falling rolls was discussed in my blog post How might a school react to falling rolls? | John Howson

What does the DfE say about the High Needs block changes?

16. As the existing SEND system will continue for 2026 to 2027, the Department’s assessment is that limiting the funding in this way will not necessarily translate into negative impacts on children and young people with SEND and will not mean that we see negative equalities impacts. This is because the requirements on local authorities to secure provision to meet the needs of children and young people with SEND will remain in place, and local authorities must meet these requirements. The consequent budget pressures will therefore lead to accruing DSG deficits rather than having a negative impact on SEND provision.

And 17. We recognise that the size of deficits that some local authorities may accrue while the statutory override is in place may not be manageable with local resources alone, and will bring forward arrangements to assist with them as part of broader SEND reform plans, as explained in the Government’s provisional local government finance settlement document. Given that local authorities will continue to be protected from the adverse impact of those deficits through the so-called “statutory override”, and because we are seeking to protect school level allocations of high needs funding through the conditions of grant attached to the DSG, we do not envisage any adverse impact on those children and young people with protected characteristics, including those with disabilities. The national funding formula for schools and high needs 26-27

Of course, this assumes that the cash channelled through the Schools Block of the DSG is actually spent on SEND by schools, and accounted for as such in academy and MAT budgets. I am sure that will be the case.

Still, those special schools that see the base funding per pupil stuck at £10,000 for another year will no doubt wonder what has happened to inflation accounting.

All we can hope for is that it won’t be too long before the SEND reforms are announced. However, with consultation session running into 2026, it is difficult to see how SEND reforms and local government reorganisation won’t become mixed up together, with who knows what results. Perhaps the new arrangements announced for Surrey might give an indication. Hopefully, the fact that West Northamptonshire has the largest reduction in the High Needs Block of any upper tier authority (25%+) is due to its past history, not its present resourcing.

Serendipity Part 2

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I mentioned in my previous post that yesterday I had been reading a random volume of the TES in a library and had found comments about special needs and the transfer of funding to schools after the 1988 Education Reform Act. I am grateful to the Chief Finance Officer at a leading MAT who straightaway sent me an article about funding of schools in Edmonton, Alberta in 1990. Thanks for the article, and for reading my blog.

In the same volume of the TES, I also discovered, again quite by accident, an article I had written and sent to the TES. I think it was my earliest contribution to the TES, and one I had completely forgotten about.

I have reproduced it here so I once again have it my collection, and also because of the up-coming budget in November that might be one for growth rather than business, and if so,  might the Chancellor risk overlooking any consequences for teachers and other public sector workers in any dash for growth?

Bad business for teaching

Chancellor Lamont’s budget for business is bad news for teachers. Like many public sector workers they will be reflecting that the new share option schemes and the 6p off the basic rate of tax which can now be earned through profit-related pay schemes will benefit their friends in the private sector without offering any incentives to them. However, if these changes help to bring down the level of basic pay settlements in the private sector then they will directly affect the level at which next year’s pay settlement for teachers is fixed; teachers could find themselves losers all round.

As consumers of large amounts of in-service training, teachers might have expected to benefit from the new tax relief on vocational training. But the present proposals only refer to national vocational qualification awards and will be of no use to the many teachers who currently pay for their own studies. This will particularly affect married women seeking to return to teaching who often need to finance further studies before they can regain a teaching post. This clause needs urgent consideration during the passage of the Finance Bill to ensure teachers are not seriously disadvantaged as an occupational group.

Finally, the increase in petrol duty and the associated rise in VAT may well have serious consequences for the already fragile labour market for teachers. Many schools are some distance from public transport, in housing estates or rural villages with only one bus a week. The increase in petrol prices may make it more difficult to attract teachers to work in these schools.

If Kenneth Clarke [then SoS for Education] saw the drift of the budget proposals before last week’s Cabinet meeting then he must accept responsibility for their effect on the teaching profession. Undoubtedly, however, our archaic system of placing the Chancellor on ice for a period before he delivers his budget has probably meant that in their enthusiasm for delivering a ‘budget for business’ the Treasury team has ignored the effect of their changes on those who work in the public sector, and particularly in education.

These days there is much more transparency about possible budget proposals, so fewer rabbits are pulled out of the hat on budget day. However, the bus that ran once a week, probably disappeared many years ago, but petrol duty hasn’t risen in line with inflation, and electric cars now offer an alternative. By the way, how many schools have EV charging points in their car parks, and do MATs offer a salary sacrifice scheme to help with the purchase of an electric vehicle? Is there an electric mini-bus schools can purchase? And I didn’t write the headline.

Solve the High Needs Block statutory override issue now

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June is the time of year when local authority Directors of Finance start thinking about the budget for the following April. HM Treasury is doing the same thing for the government but, with a Spending Review just announced, their task this summer should be much easier than usual as Ministers have already negotiated with the Chancellor. Directors of Finance have no such protection and are bound to produce a balanced budget for councillors to approve or face the prospect of having to issue a s114 notice and default, as some councils have already had to do in recent years.

It was very surprising not to see an announcement in the recent Spending Review about the statutory override many upper tier councils are carrying on their balance sheets,

The statutory override on council balance sheets is a result of overspends on council’s High Needs Block spending that finances the pupils and young adults with special educational needs in their local area. (SEND)

There are suggestions that a significant number of upper tier authorities with be unable to present a balanced budget for 2026/27 to councillors next February for approval unless something is done about the present statutory override that currently ends in March 2026. If nothing else is put in place, some councils will not be able to present a balanced budget and hence will default.

The simple answer would be to extend the override until March 2027 to see what the White Paper on SEND, now promised for the autumn, will bring. That move just buys time for a longer-term solution.

I wonder whether the DfE thought local government re-organisation might be a way of dealing with the deficit when new councils were being formed. After the results of May’s elections, I cannot see the present government wanting to push ahead with reorganising councils and creating new elected Mayors if such a move were to hand more victories to their opponents, and notably to the Reform Party. If reorganisation grinds to a halt that route out is no longer available for solving the issue of the override.

Another alternative is to switch the 2% precept on Council Tax from adult social services to SEND and let the NHS take the strain on funding for the mostly elderly residents currently being paid for out of the local government funding 2% precept. Such a move would not be popular but could be possible. As it wasn’t in the Spending Review it seems unlikely.

The DfE could rearrange their spending and transfer the consequences of falling pupil numbers from the Schools Block to increase the High Needs Block and do the same for the Early Years funding to keep it constant on a per child basis but recognise fewer children means less total spending. Such a move would affect funding for schools and early years setting with falling rolls.

Do nothing and councillors in Parties running councils will return from their summer breaks to be confronted with a list of serious reductions in services and personnel that might be needed in 2026. Such reductions won’t be efficiency gains, but unacceptable cuts on the level of a fire sale.

Solving the problem of the statutory override between now and the parliamentary recess for the summer should be the number one priority for all involved with education and local government. Not to do so would have consequences that are unthinkable.

The situation regarding the statutory override should not have reached the present position. In my view, it would be a gigantic failure of political will if it is not solved now.

2% for all main scale teachers

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Yesterday, the School Teachers Pay Review Body published its report and recommendations to the government. https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/626156/59497_School_Teachers_Review_Accessible.pdf as expected, the STRB felt bound by the remit letter it had received from government. As a result, its conclusions didn’t breech the government’s stated policy of a one per cent cap on public sector pay: no real surprise there. However, the STRB’s recommendations did contain one suggestion for higher pay to the maximum and minimum of the main pay range.

STRB’s 2017 Recommendations

For September 2017, we recommend:

  • A 2% uplift to the minimum and maximum of the main pay range (MPR);
  • A 1% uplift to the minima and maxima of the upper pay range (UPR), the unqualified teacher pay range and the leading practitioner pay range;
  • A 1% uplift to the minima and maxima of the leadership group pay range and all head teacher group pay ranges; and,
  • A 1% uplift to the minima and maxima of the Teaching and Learning Responsibility (TLR) and Special Educational Needs (SEN) allowance ranges.

If accepted, these recommendations will lead to some teachers receiving a higher pay rise than others, notably those on the top of the main scale, but not having progressed through to the higher pay scales. Now since many, if not most academies don’t have to stick to the national pay scales, this provides an interesting opportunity for the teacher associations to flex their muscle and demand a 2% rise on the main scale for all teachers not covered by the mandatory national pay scales. If achieved, it would put pressure on the government either to offer the same deal to other teachers across the sector or risk teacher recruitment and retention issues becoming worse outside the academy sector.

The data in the STRB Report suggests that most schools can carry an extra one per cent on their main scale teacher’s pay bill by dipping into reserves. Yes, a hoped for building project might be delayed by a year, but many teachers would feel that their financial situation is being taken seriously.

Is it in the interests of the teacher associations to take this line or to hold out for more for everyone at some point in the future? That’s their judgement call, but I think the two per cent for all main scale teachers demonstrates that they do more on the pay front than just argue the case with the STRB and are indeed prepared to take on a weak government playing a poor hand on public sector pay.

To compensate, I would argue for bringing MAT chief officers pay within the overall cap. It is surely wrong to cap the pay of workers but let the bosses set their own take from public money, albeit sanctioned by their boards.

There is plenty of evidence within the STRB report of recruitment problems, but having waited so long to publish the STRB might have updated some charts with the evidence from the 2016 School Workforce Census rather than relying on 2015 that charted the recruitment round for September two years ago.

Another aspect of the funding problem

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What happens if a large secondary school at the centre of a multi-academy trust comprising a mix of both primary schools and a secondary school goes bust, perhaps because the original founders made some unwise decisions and there was then a drop in applications from local parents to send their children to the secondary school, aware that teachers were leaving the schools and concerned that standards might slip as a result? Or because there was an outflow of EU nationals from the area now Article 50 has been triggered.

Does the failure of the secondary school bring down all the primary schools in the MAT as well or can they survive on their own. At what point should the trustees decide to cut a financially unviable school adrift and will the Education Funding Agency allow them to do so if there are other assets in the MAT that might keep the school going for longer?

I am sure that there are civil servants in Coventry thinking about these types of scenario and perhaps role-playing them with Regional School Commissioners. How far have they progressed in their thinking should the MAT has a faith base and all the schools within it belong to the same faith or Christian denomination?

Sitting in the wings is the local authority, with whom the ultimate authority for providing every pupil with a school place still resides. What happens if the school that has just become financially unviable is in a rural area and the places at other schools require a large increase in the school transport bill? Who picks up the tab?

Obviously, the ideal solution is for the school buildings to open under a new administration, but will the government allow that to happen if it means writing off the debts of a school. To do so might encourage other schools to run up large deficit budgets, secure in the knowledge that the government will bail them out. One answer might be for the government to replace the trustees. But at what point? As soon as a deficit budget position is reached? When the deficit going forward looks as if it will reach a pre-determined percentage of current turnover after taking any falling rolls and thus falling income into account? If the financially unviable school is a faith school, can a new faith school replace it? To do so might well save on transport costs, but a replacement school that wasn’t faith-based might allow for transport savings. Of course, much will depend upon who has the ownership of the buildings?

With the demise of several UTCs and studio schools, plus a small number of other academies, these scenarios are no longer in the realm of the unthinkable. But, does there need to be a level playing field with some clear and open guidelines that don’t encourage schools to create deficits on their revenue spending.

At present, there is the ‘financial notice to improve’ from the EFA, but, the issue is what happens when the school or MAT doesn’t do so for reasons beyond its control? Time to re-read the Academies Financial handbook.

 

Education in the budget

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Never mind what the Chancellor said, pasted below is what the Treasury are really saying about education in the budget.

Here are my thoughts:

How will the 10% of schools that could gain under the National Funding Formula, but won’t receive the full amount, be identified?

Where is the funding for the extra pupils to come from? Some 700,000 extra pupils at £4,000 would generate a need for 32.8 billion extra funding by early in the next parliament. There isn’t anything about this in the budget.

This sort of basic need funding makes the extra money from the sugar tax look less than generous, even if it is a job creation scheme funded by the drinks industry for art, PE and drama teachers. I also note that while the figure for primary schools is clear; an extra £160 million per year, the figure for secondary of £285 million is only expressed as ‘up to’ – so no guarantee there.

If all 1,600 schools take up the £10 million for breakfast clubs they will receive £32.89 per day based upon a 190 day school-year. Helpful, but not a huge amount.

What happens as the industry cuts out sugar and reduces the amount the levy will raise isn’t, of course, clear.

Interestingly, there was no comment on the costs associated with the big gamble to make all schools academies. This isn’t a cost free exercise, as one of my earlier posts has shown.

The 2016 budget

Education

1.89 This Budget accelerates the government’s schools reforms and takes steps to create a gold standard education throughout England. The government will:

  • drive forward the radical devolution of power to school leaders, expecting all schools to become academies by 2020, or to have an academy order in place to convert by 2022. The academies programme is transforming education for thousands of pupils, helping to turn around struggling schools while offering our best schools the freedom to excel even further
  • accelerate the move to fairer funding for schools. The arbitrary and unfair system for allocating school funding will be replaced by the first National Funding Formula for schools from 2017-18. Subject to consultation, the government’s aim is for 90% of schools who gain additional funding to receive the full amount they are due by 2020. To enable this the government will provide around £500 million of additional core funding to schools over the course of this Spending Review, on top of the commitment to maintain per pupil funding in cash terms. The government will retain a minimum funding guarantee
  • ask Professor Sir Adrian Smith to review the case for how to improve the study of maths from 16 to 18, to ensure the future workforce is skilled and competitive, including looking at the case and feasibility for more or all students continuing to study maths to 18, in the longer-term. The review will report during 2016
  • invest £20 million a year of new funding in a Northern Powerhouse Schools Strategy. This new funding will ensure rapid action is taken to tackle the unacceptable divides that have seen educational progress in some parts of the North lag behind the rest of the country. In support of this, Sir Nick Weller will lead a report into transforming education across the Northern Powerhouse

Soft drinks industry levy to pay for school sport

1.90 Childhood obesity is a national problem.

The UK currently has one of the highest overall obesity rates amongst developed countries In England 1 in 10 children are obese when they start primary school, and this rises to 2 in 10 by the time they leave.

1.91 The evidence shows that 80% of children who are obese between the ages of 10 and 14 will go on to become obese adults, and this has widespread costs to society, including through lost productivity and the direct costs of treating obesity-related illness. The estimated cost to the UK economy today from obesity is approximately £27 billion, with the NHS currently spending over £5 billion on obesity-related costs.

1.92 Sugar consumption is a major factor in childhood obesity, and sugar-sweetened soft drinks are now the single biggest source of dietary sugar for children and teenagers. A single 330ml can of cola can contain more than a child’s daily recommended intake of added sugar. Public health experts have identified sugar-sweetened soft drinks of this kind as a major factor in the prevalence of childhood obesity.

1.93 Budget 2016 announces a new soft drinks industry levy targeted at producers and importers of soft drinks that contain added sugar. The levy will be designed to encourage companies to reformulate by reducing the amount of added sugar in the drinks they sell, moving consumers towards lower sugar alternatives, and reducing portion sizes.

1.94 Under this levy, if producers change their behaviour, they will pay less tax. The levy is expected to raise £520 million in the first year. The OBR expect that this number will fall over time as the total consumption of soft drinks in scope of the levy drops, in part as a result of producers changing their behaviour and helping consumers to make healthier choices.

1.95 In England, revenue from the soft drinks industry levy over the scorecard period will be used to:

  • double the primary school PE and sport premium from £160 million per year to £320 million per year from September 2017 to help schools support healthier, more active lifestyles. This funding will enable primary schools to make further improvements to the quality and breadth of PE and sport they offer, such as by introducing new activities and after school clubs and making greater use of coaches
  • provide up to £285 million a year to give 25% of secondary schools increased opportunity to extend their school day to offer a wider range of activities for pupils, including more sport
  • provide £10 million funding a year to expand breakfast clubs in up to 1,600 schools starting from September 2017, to ensure more children have a nutritious breakfast as a healthy start to their school day

There are also some regional developments associated with the northern Powerhouse developments.

Finally, Gordon Brown meddled in education as Chancellor; one result was the 2002 staffing crisis after schools were handed cash, but the extra teachers they tried to recruit with the money hadn’t been trained. Will this Chancellor fare better with his announcements on academies and will Tory backbenchers go along with making their local primary schools all academies?