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The government has responded to concerns that integrating the costs of supporting children with special educational needs and disabilities (Send) into broader education budgets might reduce funding for schools. According to the Department for Education (DfE), projections made by the Office for Budget Responsibility (OBR) are inaccurate because they fail to consider planned reforms set to be announced in the new year.
Under the government’s plan, by 2028, all funding related to Send will be removed from local authorities’ responsibilities, shifting an anticipated additional £6 billion in costs to central government. Local councils have welcomed this move, acknowledging that escalating expenses have rendered current Send spending levels unsustainable. However, teaching unions have echoed the OBR’s concerns that this change could negatively affect school budgets.
Currently, local authorities receive a dedicated schools grant from the DfE to fund special needs support. Yet, growing demand has resulted in councils spending billions above the allocated government grants. The number of young people with council-funded education, health, and care plans (EHCPs) has more than doubled since 2016. Since 2020, councils have been shielded from reporting Send-related debts on their balance sheets by a “statutory override,” which has been extended to 2027-28. Without this subsidy, many councils warn of financial crises and even bankruptcy. The OBR projects cumulative council deficits of £14 billion by the end of 2027-28, but it remains unclear how much of this debt councils will be responsible for repaying.
In the recent Budget, it was revealed that the government would absorb Send costs entirely within departmental budgets by 2028-29. Despite this, the OBR noted that the government has yet to identify any savings to counterbalance the projected £6 billion cost increase. If this funding were to come from existing school budgets, the OBR warned of a potential 4.9% reduction in mainstream school spending per pupil, a significant decrease compared to the government’s plan for a 0.5% increase. The DfE rejected these forecasts, emphasizing that the OBR’s analysis overlooks the necessary Send reforms their administration will introduce. A spokesperson stated, “We inherited a Send system on its knees and our changes will make sure children get support at the earliest stage, while bringing about financial sustainability for councils.” Detailed reform plans are expected to be published early next year.
Despite these assurances, many questions remain about how the government will balance the increasing demand for Send support with the rising costs involved. Matthew Hicks, chair of the County Councils Network, described the government’s commitment to managing Send expenditure as a positive step but expressed concern about unresolved issues regarding council debts accrued before 2028. Pepe Di’Iasio, general secretary of the Association of School and College Leaders (ASCL), warned that any reduction in school funding “would clearly have a catastrophic impact on educational provision,” urging the government to clarify its strategy urgently. The National Education Union (NEU) has threatened strike action if funding concerns continue to be ignored, with an executive meeting planned to determine next moves. Anna Bird, chair of the Disabled Children’s Partnership, highlighted the “lack of clarity” about how Send costs will be met and raised doubts about how quickly the system can be reformed. Independent analyst Luke Sibieta of the Institute for Fiscal Studies identified three possible approaches for handling the Send funding gap: slowing cost growth through reforms, increasing overall school budgets, or reducing mainstream school funding to cover high needs costs.
The government recently postponed its white paper on Send reforms until the new year, stating a need for extended consultation with parents and stakeholders. Political pressure is mounting, with backbench Labour MPs urging the government to avoid cutting Send provision to prevent backlash similar to that caused by proposed welfare cuts earlier this year. Shadow Education Secretary Laura Trott stressed the need for transparency on how the £6 billion in additional Send costs will be financed, saying, “Either it’s going to be a cut to schools, or it’s going to be a cut from the Send budget.” Liberal Democrat education spokesperson Munira Wilson described the funding shortfall as “a damning indictment of this government’s failure to get a grip on the system,” warning ministers against addressing the crisis by reducing mainstream school budgets. Meanwhile, a comprehensive report from last year by the National Audit Office condemned the broader Send system as “broken,” noting it fails to deliver positive outcomes for children and young people despite substantial increases in funding
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