Agenda item

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

The Forum was informed that the forecast overspend for the 2023/24 HNB was £18.0m. The current HNB budget for 2023/24 in Staffordshire was £127.0m; an increase of £12.0m compared with 2022/23. None of this funding increase would be used to repay historical deficits. Staffordshire currently had c7,000 Education, Health and Care Plans (EHCP) in place; an increase of 33% in the last three years.

At the end of the last financial year the DSG reserve ‘deficit’ increased from £8.6m to £14.2m. Given the forecast overspend in 2023/24 this would likely deepen further in 23/24 and was expected to be over £30m in deficit at the end of the current year. The Government had put in place a ‘statutory override’ requiring that accumulated DSG deficits would remain ringfenced separate to the Council’s other reserves - this had now been extended through to end of 2025/26. Left unaddressed the accumulated deficit would likely reach c£100m by the end of 2025/26. This was highlighted as the Authority’s most significant financial risk.

The Forum was reminded of the introduction of the Deficit Management Plan (DMP) which included actions that could be taken to address and mitigate the existing shortfall. To date the DMP had had little impact and was currently being updated. A meeting was also scheduled to be held with the Education and Skills Funding Agency (ESFA) in the Summer of 2023 to discuss the latest position.

It was recognised that position was far worse than had been previously expected, partly on the grounds of the increased raises on the Education Banding Tool (EBT) model. It was intended that the EBT would be cost neutral when it was introduced, but there had been a clear and marked increase in the average costs of those children assessed under the EBT model, compared to those that remained on the existing matrix model in both special schools and mainstream schools, with a significantly higher number of children being assessed on the banding levels of 8 to 10.

For the children who had transitioned from the matrix model to the EBT funding model, it was estimated that an additional £5m had been incurred to date, and this figure would only increase if the situation was not addressed. Given the existing deficit, this was considered unaffordable.

It was highlighted that two of the key actions included in the DMP related to the

increase of the number of Children and Young People (CYP) with EHCPs who accessed mainstream education, and the review of the specialist provision (mainstream, special and alternative provision) including enhanced provision in mainstream schools. It was hoped that this would be expedited quickly to ensure there was sustainable provision across the county that would meet current and future needs and demands.

The Schools Forum was informed that the authorities senior leadership team and Cabinet members had sent a briefing note to all local MPs outlining the particular challenges associated with the HNB and the pressure on the Dedicated Schools Grant (DSG). It was agreed that the briefing note would be shared with Forum members.

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

b. That the briefing note sent to local MPs be shared with the Schools Forum.