Agenda item

High Needs Block including Deficit Management Plan

Minutes:

The Schools Forum received a report from the Director of Children and Families relating to the High Needs Block (HNB).

 

Members heard that the forecast outturn for the 2023/24 High Needs Block was £20m overspend which saw no increase on the Quarter 2 forecast overspend. Key variances were reported as:

 

  • an overspend of c £11m against the school ‘top up’ budgets including, most significantly, a rise in the number of children with EHCP/AEN support in Mainstream Schools and Academies leading to a £4.2m overspend, and an overspend of £5.3m in special schools and academies due to the combined impact of increasing demand, complexity and costs.

 

  • an overspend of c £6.9m in Independent Special Schools with numbers reported as being in excess of 600 pupils, which is double the number reported four years ago.

 

It was highlighted that the financial position had been negatively impacted by increased costs that were created as a result of the introduction of the Education Banding Tool (EBT). The Schools Forum was reminded that, following the planned review of the EBT during Summer 2023, the decision had been made to suspend the use of the EBT as a mechanism to calculate the top-up funding for Staffordshire pupils with an Education, Health and Care Plan (EHCP) from 1 August 2023. It was reiterated that SCC remained committed to the EBT and was currently undertaking a remodelling of both mainstream and specialist band values to ensure the quality assurance steps were in place, with the intention of reinstating the EBT with the assurance that all issues experienced had been resolved. SCC would continue to keep schools informed of progress with the aim of an education provider consultation being undertaken prior to an agreed re-launch of the EBT.

 

As a result of the on-going overspend in the HNB the DSG reserve had been fully depleted and at the end of 2022/23 there had been an accumulated deficit of c£14.2m. Given the latest forecast overspend in 2023/24 of £20m the deficit was likely to increase over the year and, after the transfer of anticipated surpluses from Growth Fund and Central Block, was forecast to be over £30m in deficit at the end of the current year. It was highlighted that, left unaddressed, the funding gap for the HNB would increase going forward to at least £40m over budget by 2027/28. This would see the overall accumulated DSG deficit increase to between £150m and £225m by the end of 2027/28.

 

The Forum was reminded of the Deficit Management Plan, and a number of updates were provided. Most notably:

 

  • Creating an inclusive system where more of our children are educated and supported in our mainstream schools, reducing the reliance on more expensive independent provision.

 

  • Reviewing existing policy, non-statutory provision and considering alternative delivery and funding options. The Council continued to work up options for the provision of residential educational provision (c £1.8m p.a.). This was a complex issue that would take time. It had therefore been agreed that existing contracts would be extended for a further 2 years up to July 2026.

 

  • Transfer of 0.5% funding from the Schools Block to the High Needs Block (circa £3.2m in 2024/25). This would be invested to fund the Council’s transformation programme.

 

The provisional Government funding settlement for 2024/25 would see SCC’s High Needs Budget increase to £132.4m (a net rise of circa 4%). It was reported that whilst this was in line with expectation the rise was significantly lower than recent years and, given the continuing growing demand, the existing overspend would likely increase further next year and going forward.

 

Members were informed that the Government had set a Minimum Funding Guarantee level for 2024/25 of between 0% and 0.5%. Given SCCs forecasted overspend and accumulated deficit it had been decided that the MFG for 2024/25 would be set at 0%.

 

In response to a question from Steve Barr asking if it was within SCC’s authority to select the level at which the MFG was set, it was confirmed that it was an Officer decision within the parameters set by the Government.

 

In response to a question from Paul Spreadbury asking if confirmation could be provided that the current funding levels for all pupils would remain the same until they changed school or there was a significant change of need, it was confirmed that unless there was a significant change of need the current arrangements would remain in place.

 

It was noted that some Special Schools were receiving consultations for September 2024. SCC was asked whether the funding agreed for these pupils would be guaranteed until they either changed school or there was a significant change of need, in response it was confirmed that, where a place and funding had been agreed, those arrangements would remain in place until there was a significant change of need. It was also confirmed that a child that remained in the same school but moved through the Key Stages would not be considered a substantive change.

 

Kim Prince-Anson highlighted that a Special School had received consultations for September 2025, but were unable to confirm places as they were unaware of the level of funding that would be available. In response the Forum was informed that work would be taking place during the Spring term of 2024 to analyse the data gathered during the Autumn term of 2023, and discussions relating to the new banding levels associated with the EBT would likely take place with Schools in the Summer term of 2024.

 

In response to a question from the Chair asking if there was an intention to engage with Special School Head teachers to develop good practice, it was confirmed that Special Heads would be asked to help to process the new data set, and to support the development of the new model.

 

An update was provided by the Head of SEND on the Accelerated Progress Plan (APP) and Strategy for Special Provision update. The Forum heard that large strides had been made in the implementation of the APP. A report had been received from the Department for Education indicating that they continued to be supportive of the approach SCC had adopted – mindful that the two major strategies, the Enhanced Assess-Plan-Do-Review (EAPDR) Pathway and the pre-statutory Staffordshire Enhanced District Inclusion Support (SEDIS) Model were still being worked on.

 

The EAPDR had been launched in January 2024. 15 children were already on the Pathway with allocated Educational Psychologists (EP), funded by SCC. These were noted as children being supported in schools in a pre-statutory position - before an Education, Health and Care Needs Assessment. Additional enhancements were due to be implemented focussing on the support children received as they travelled through the process. The EADPR would continue to be monitored and a project team was in place that would closely monitoring demand, process and outcomes.

 

20 Expressions of Interest (EoI) had been received at the end of December, for involvement with the proposed eight SEDIS model Teams – in one instance an EoI had been received from two special schools working with two mainstream schools across all Key Stages. The analysis of the EoIs would start in late January 2024, with a view to interviewing candidates soon after. It was the intention that SEDIS model would be implemented (as a rolling start) from September 2024.

 

It was reported that a gap analysis had been undertaken to consider the need to develop further Special School provision. Seven EoIs had been received from Schools and a meeting would take place in March 2024 to conclude where the Capital Funding would be allocated. One of the projects had already started and was currently in the build phase.

 

Resolved: a. That the High Needs Block budget update 2023/24 and latest forecast outturn be noted

 

b. That the update on the latest DSG government settlement be noted.

 

Supporting documents: