No answers on SEND finance ‘bomb’

Dudley Council is still waiting for answers about how to tackle a financial ‘bomb’ which could push it into effective bankruptcy.

In the budget on November 26, chancellor Rachel Reeves announced from the end of the 2028/28 financial year the government would pay for special educational needs and disability (SEND) education, a cost currently paid by local authorities.

The change could save Dudley Council around £30m per year however there may be a sting in the tail of the new policy.

The council pays for SEND out of its Dedicated Schools Grant (DSG) which is predicted to be £56m in deficit by the end of the current financial year.

Currently the DSG deficit is not included in the council’s general accounts but, after 2028, the statutory override which protects councils from having to pay off the extra debt will end.

Councillor Wayne Little, Dudley cabinet member for children’s services and education, said: “We welcome the announcement that SEND funding is proposed to come from central government budgets from 2028-9 when the statutory override ends.

“Until the government publishes its Local Government Finance Settlement in December and SEND reforms white paper in January we will not know how it intends to address historic SEND deficits.

“However, we know we are in a much better position as an authority than we were a few years ago with the latest report to cabinet showing the council is on track to deliver savings of £53.6 million, and put £7.5 million back into reserves by the end of 2025/6 increasing general reserves to £36.3m.

“We are absolutely committed to all of our children and young people and have recently invested in the brand new, purpose built Pens Meadow school for children with significant SEND while continuing to support inclusion across all our mainstream schools.

“We look forward to the government’s future funding announcements.”

Demand for SEND services is growing, in Dudley there was an 88 percent increase in caseloads between 2019 and 2024.

In England for the same period the increase was 62 percent, the problem was discussed in September at a meeting of the council’s Audit Committee.

Cllr Jackie Cowell said: “It’s growing rapidly and growing rapidly nationally, at some point it is going to be like a bomb going off.

“Has anybody managed to work out what the direction of travel will be, are we any clearer about the longer-term situation?”

Lisa Kitto, Dudley’s interim director of resources, said: “The statutory override is like a sticking plaster, we have been lobbying along with other councils for a solution, there isn’t one at the moment other than an extension of the statutory override.

“Somebody has got to make a decision in terms of how we treat it, until that comes through there is very little we can do.”

Cllr Amanda Hopgood, chair of the Local Government Association’s Children, Young People and Families Committee, said: “In the provisional Local Government Finance Settlement, we urge the government to write off these deficits – both the current accumulated deficits and any future deficits expected up to and including 2028/29 – and to fully fund all associated costs such as home to school transport over this period.”