Agenda item

To update the Schools Forum on the DSG High Needs Block Budget for 2025 - 26.

Folake Olufeko (Head of Finance, Brent Council) introduced a report, which set out the proposed DSG Schools Budget for 2025/26 for consultation and agreement by Schools Forum.  The Forum noted the following key points as part of the update provided:

·            The DfE’s HNB funding had been confirmed at £90.3m for 2025/26.  This was £5.3m more than that received in 2024/25 and represented an increase of 6%.

·            In addition, the Schools Forum had approved a Schools Block transfer of 0.5% totalling £1.5m.  This bought the total funding for the HNB in 2025/26 to £91.8m.

·            £9.5m of the total HNB funding would be recouped by the Department for Education (DfE) to be paid directly to academies for their base funding, leaving a balance of £82.3m.

·            The budget assumed that the top up banding rates would remain the same for the Pupil Referral Units (PRUs) and Special Schools.  Following agreement at the November Schools Forum, the banding rates for mainstream schools had been adjusted for rounding.  Three bands had been rounded down and two had been rounded up with a negligible financial impact on the overall funding allocated to schools and colleges.  These rates were detailed in Appendix 3 of the report.

·            The rates for Additionally Resourced Provisions (ARPs) had remained the same for the purpose of setting a balanced HNB budget for 2025/26.  However, the local authority planned to consult on the use of a Resource Allocation System for the funding of ARPs and non-statutory early years funding from the HNB.  The consultation, which was initially planned for January 2025 had been delayed and was anticipated to commence later in Spring 2025.  This would be informed by modelling of the impact of proposed rates and benchmarking information and a report provided to Schools Forum after the proposed consultation had been completed.

·            The DfE had announced that three separate grants received in 2024/25, TPAG (The Teachers’ Pay Additional Grant), TPECG (Teachers’ Pension Employer Contribution Grant) and CSBG (Core Schools Budget Grant) would be paid as a separate CSBG in 2025/26.

·            Further information about the distribution of additional funding to compensate employers for the planned increase in their National Insurance Contributions from April 2025 would be published by the government in spring 2025.

·            A £0.683m budget allocation had been set aside to continue to pass the historic Teachers’ Pay and Pensions Grant at the same rate provided by the DfE of £660 per place.

·            Additional cost pressures seen in 2023/24, for which a 3.4% funding increase was made available, equivalent to the Mainstream Schools’ Additional Grant (MSAG) continued to be allocated to special schools and PRUs.  £1.2m had been set aside to account for this cost.

·            There were increases in the overall top-up funding allocations for Special Schools and mainstream pupils both in and out of the borough.  These budget increases reflected the rise in demand through increased commissioned places and the spending patterns of previous years.  In total £3.6m of the increased HNB funding had been allocated in response to the demand against these lines.

·            The HNB budget included funding allocation for three new ARPs that were expected to be in operation from September 2025, however it was noted the start date may be delayed subject to completion of building works. 

·            The budget for funding the education element of the cost of placing children in independent residential special schools had reduced by £0.1m, in line with current forecasts.

·            The recoupment budget was an income budget which offset expenditure related to pupils from other boroughs, inclusive of administrative charges.   This budget had been set at £3.7m in line with the current year’s forecast and projected demand for 2025/26.

·            The budget for funding the education element of the cost of placing children in independent residential special schools had reduced by £0.1m, in line with current forecasts.

·            A zero-based budget setting approach had been applied to the budgets for SEN Services.  There was also an increase from a change in the Speech and Language Therapy contract, which was funded from this budget due to expected increased demand and the extension of the contract to include provisions for children placed in ARPs from April 2025.  This area had seen a budget increase mainly due to aligning staffing costs to current agreed establishments and allocating a 3% increase in pay award for 2025/26.

·            In terms of risks applied to the budget, there was still a statutory override in place where the local authority had been allowed to carry a deficit and the current deficit was £13.6m, which should come to an end in March 2026 but posed a significant risk against the Council’s General Fund reserves. 

·            The available resources had been allocated within the constraints of the funding for the provision of SEND, with a budgetary gap of £1.1m that had been mitigated by setting a tight budget against the independent day special budget line, with the intention to place more children in settings within the borough instead.

·            There was also the risk of rising inflation for SEND provision in out-of-borough and independent settings, where providers were seeking over inflationary prices to deal with pressures.

The Chair thanked Folake Olufeko for her report and welcomed any questions from the Forum, with the following noted:

·            It was clarified that the Schools Block transfer of 0.5% was top sliced from funding for both maintained schools and academies.

·            Nick Cooper raised a concern about top up funding rates remaining the same as 2021 and not being increased and it was queried if there was a plan to review these.  It was also felt that the 3.4% funding increase being made available to be allocated to Special Schools and PRUs was not accumulative however pay increases and on-cost services were accumulative, so this was not sustainable for Special Schools.  Additionally, costs could be saved by utilising empty or part empty buildings for the provision of SEND places, which would mitigate the need for out of borough places so it was queried whether there was a plan for this and whether this could be raised at the next Schools Forum meeting.  Lastly, at the Cabinet meeting held in January 2022, £44m of capital investment for additional SEND places was approved, so it was asked if the detailed plan for this expenditure could be shared with the Forum.

In response, Roxanne Glennon advised that there had been a 6% funding increase but EHCPs had increased by 8% and so had the complexities that the children were presenting with.  The level of funding was not keeping pace with the level of demand.

Folake Olufeko advised that the 3.4% funding increase was one-off funding by the DfE to address the additional pressures faced that year and it had been passed onto Special Schools and ARPs since then, which comprised of almost 25% of the 4.9% increase.  Roxana Glennon advised that the School Places Planning Strategy revealed that there was in-house capacity so Brent was currently exploring the potential around empty buildings and there was capacity for satellite provision within the primary sector.  Nigel Chapman added that progress was being made in terms of building works with the additional capacity on track to be open by September 2025.

·            Councillor Gwen Grahl stated that the SEND capital investment programme was a priority with the priority for any empty buildings that were formally educational sites, to be retained for educational use.  Councillor Grahl thanked colleagues for their hard work in supporting SEND pupils in this difficult landscape.  Councillors had been lobbying with other London councils and lead members and a submission had been made to the Education Select Committee who would be addressing this issue soon.  Lobbying was conducted for an increase in core SEND funding, as well as ring fenced funding for accessibility adaptations in schools including Specialist Schools.  Targeted work was being done to address workforce issues and better training and targeted funding was aimed at addressing waiting lists in the NHS for children waiting for assessments for ASD or ADHD.

·            In Jennifer Cooper’s absence the following question was submitted in written form – “The NEU has a large density of members within the Special Schools in Brent and is extremely concerned by the proposals around the High Needs budget/banding funding which impacts this sector. If we have interpreted figures correctly there appears to be no actual increase in banding funding for special schools despite an increase in the high needs budget of 6%. This is not in our view sustainable for the existing schools bearing in mind efficiencies that have already been made due to increased costs overall. Our high needs pupils deserve a quality education and due to their complex needs are unable to access this without the funding needed to provide for these very needs such as, for example, adequate and safe staffing ratios, specialised equipment and additional costs associated with engaging with the community safely through educational visits. As far as we are aware there has now been four years without an increase in the banding funding and this freeze has operated during the cost of living crisis which has impacted on school bills and the extortionate cost of specialist resources needed to access education for these pupils”.

In response. Officers advised that the issues raised were felt to have already been addressed in response to the comments also raised by Nick Cooper.

As no further questions or comments were raised the Forum RESOLVED to note the report and approve the High Needs Block budgets as set out in Appendix 1 of the report.