Agenda item

Report of the Deputy Chief Executive and Director for Families and Communities

Forum had requested regular updates on the latest position of the High Needs Block, including the impact of the additional DfE funding of £1.7m in 2019/20 and the transfer of £2.4m (0.5%) from the Schools Block to the High Needs Block.  Members were informed that the forecast outturn for the 2019/20 High Needs Block was a £4.6m overspend, an increase of £2m from the £2.6m previously reported in July.  This was result, in the main, of rising costs within Independent Schools.  The Government, as part of the recent Spending Review, had announced a further £700m funding for the High Needs Block in 2020/21.  It was estimated that this would provide for an additional circa £8.6m for Staffordshire and would go a long way to addressing the current underlying budget shortfall in this area.  Unfortunately, and assuming: the additional High Needs Block will remain in place going forward; and that funding levels going forward will increase annually thereafter in line with inflation, given the increasing cost and demand for SEND, this additional funding was unlikely to address the funding gap completely and there was still likely to be a shortfall in 2020/21 of £2m, rising to £7.4m annually by 2023/24.

Using the latest information, the table below illustrates the effect of the High Needs Block on the overall Dedicated Schools Grant (DSG) balances.  It was expected that, at the end of the current year, the DSG reserve will be all but depleted and there would be no “buffer” available to help manage future budget pressures.

The schools revenue funding 2020 to 2021 operational guide, issued in September 2019 by the Education and Skills Funding Agency confirmed that local authorities may transfer up to 0.5% of their schools block funding into another block, with the approval of their Schools Forum.  Up until this guidance was published it had not been known if this flexibility would continue.  There was a need to protect DSG balances through the short term due to rising demands and costs of SEND in Staffordshire.  It was expected that the SEND transformation would yield savings over the medium term.  It was important to continue to lobby Government for additional funding as even with the injection of £700m nationally, although very welcome, was unlikely to close the gap in funding. 

Members were informed that the timetable for the funding switch approval was very tight.  All schools needed to be consulted with and the Forum needed to be informed of the results of the consultation in order to approve or reject the funding switch.  If the funding switch was not approved by the Schools Forum then this would need to be referred to the Secretary of State by the 28th November.  With this tight timescale in mind, members were asked if they wanted to hold an Extraordinary Meeting to discuss the outcome of this consultation or vote electronically.  Members agreed to hold an Extraordinary Meeting on 26 November.  A member pointed out that schools and the Forum had been overwhelmingly against the funding switch last year, and that it was an important message to the Government that schools were not able to afford it. 

RESOLVED – That:

a)    The update on the High Need Block be noted;

b)    The local authority’s intention to consult with schools regarding the 0.5% funding switch in 2020/21 be noted; and

c)    The outcome of the consultation should be brought back to an Extraordinary Meeting of the Schools Forum on 26 November.