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The Guardian
30-03-2025
- Politics
- The Guardian
Why scores of English councils could go bankrupt when hidden Send debt reappears
The staggering cost of England's special educational needs and disability (Send) crisis shows no sign of easing. A Guardian investigation has revealed councils will overspend on Send services by nearly £2bn over the next year, pushing their accumulated deficits to at least £5.2bn by 31 March 2026. The date is crucial because that is when the £5.2bn debt, hidden away off local authority books using an accounting fix for seven years, is due to come back on to the balance sheets, threatening to instantly bankrupt scores of town halls. The government faces a massive headache: not just what to do about the rapidly increasing billions of historic Send debt, but how to keep a lid on future Send spending, which shows no sign of abating. There are no easy fixes. The last government tried to keep a lid on Send spending by paying millions of pounds in 'safety valve' grants to scores of councils to help them develop better ways to 'manage' parental demand for Send support. Very few of the schemes have had the desired effect of driving down costs. Of the 131 councils that responded to the Guardian, 79 signed grant agreements with the Department for Education (DfE). Only three are forecasting they will not be in deficit next year. Some of those that have slowly ground their way to near break-even say when the grants finish they will hurtle rapidly back into the red. City of York council, the only authority surveyed by the Guardian that is projecting its accumulated Send budget deficit to move into surplus next year, was sceptical about keeping its head above water in future. 'Unless the system is changed, we will go back into deficit quite quickly,' said Bob Webb, York council's executive member for children, young people and education. Attempts to change the system, however, could put councils and ministers on a collision course with parents and campaigners. Councils are clear they want changes to the law to give the authorities more control over which children get specialist Send support and where they are educated. Parents say more crude attempts to ration access to education, health and care plans (EHCPs) – formal assessments that give children the legal right to Send support – will not fix a problem caused primarily by the inability of mainstream schools to meet Send pupils' needs, and those needs are not going away. 'Parents are banging their heads against a brick wall trying to get schools to give support to their children, and they get knocked back,' said Tania Tirraoro of the campaign group Special Needs Jungle. Tirraoro said it was wrong to blame the financial woes of councils on parents exercising their legal right to Send support. '[The government] needs to write off those [council] debts. Then you need to keep writing those debts off until a programme of early intervention support and better inclusion has worked its way through the system.' The government has put an extra £1bn into Send services and plans to create 10,000 more specialist places in mainstream schools. It is clear it wants to reform Send – a white paper is expected this summer – and that a new system must be financially sustainable. No decisions have been made yet about what to do with the deficits. Sign up to First Edition Our morning email breaks down the key stories of the day, telling you what's happening and why it matters after newsletter promotion Jane Hayman, the director for Send and inclusion at Norfolk county council, said the current system is 'broken' and 'pits parents against schools'. Norfolk's Send deficit is forecast to reach £183m in a year's time. Hayman expects the government to step in to bail out the council: 'It cannot be ignored,' she said. Not everyone is so sure. Mike Cox, the deputy leader of Bournemouth, Christchurch and Poole council, whose forecast deficit will hit £168m by 31 March 2026, up £60m in a year, predicts: '[Government] is going to keep kicking the can down the road. The only thing that will change is that the can will get bigger and harder to kick.'
The Guardian
03-03-2025
- Politics
- The Guardian
Ministers plan major changes to Send education in England
Labour is preparing major changes to special educational needs provision in English schools, as individual councils raise the alarm over debts running into hundreds of millions of pounds that have pushed many to the brink of bankruptcy. A Guardian analysis has found the vast majority of English upper-tier councils have accumulated often eye-watering special educational needs spending deficits. At least 12 have forecast accumulated deficits over £100m, running as high as £312m, when the debts have to be settled in a year's time. It is understood ministers are preparing a white paper due to be published in late spring setting out details of what one insider called a 'complete recalibration' of the special educational needs and disabilities (Send) system. The government is believed to be considering changes to existing Send legislation that councils hope would ease the deficits, alongside a raft of reforms designed to prioritise state school provision and cut council spending in costly private specialist needs schools. The move comes amid frantic calls by English local authorities for ministers to write off a collective £5bn forecast deficit on Send budgets. The deficit – effectively kept off council books through a temporary credit-facility arrangement called an 'override' since 2018 – is due to hit council balance sheets on 31 March 2026 , a financial shock that could push more than 60 councils into insolvency. Council Send spending has accelerated in recent years, and the deficit – the gap between the money the government gives councils for Send and the amount they have been legally obliged to spend on provision – has become one of the biggest threats to the viability of many town halls, on a par with the social care crisis. Local authorities are lobbying for law changes to give them more control over Send costs by limiting parental rights to appeal over Send assessments, and reducing the powers of Send tribunals to direct how a child's needs are provided for in the school system. Kate Foale, a Labour councillor and Send spokesperson for the County Councils Network, said law changes must go hand in hand with reform and extra investment in special needs education. 'It [the Send system] is adversarial, and it doesn't work for children and their families. We are in a really bad place.' Parents' groups warned ministers would have a 'massive fight on their hands' over any attempts to dilute children's legal rights to Send support. 'Reducing Send entitlement won't make needs go away – you just end up with lots of children with needs but no support,' said Tania Tirraoro of the campaign group Special Needs Jungle. The biggest forecast deficits by next March include Hampshire county council (£312m by March 2026), West Sussex (£222m), Norfolk (£186m), Cheshire East (£154m), Warwickshire (£151m), Wiltshire (£117m), Oxfordshire (£111m), Gloucestershire (£108m), Somerset (£100m), and Staffordshire (£100m). Guardian analysis of two-thirds of English upper-tier councils found at least 13 have forecast accumulated Send deficits of between £50m and £100m, including Sefton (£86m), Hertfordshire (£81m), Cornwall (£70m), Cambridgeshire (£70m), Leicestershire (£66m), Merton (£65m), Central Bedfordshire (£65m), and Wokingham £61m). Bournemouth, Chichester and Poole council, whose deficit will reach £165m in a year's time, said without the deficit override it would be technically bankrupt from next month because its Send deficit exceeds its available financial reserves. It described its position as 'an impossible situation'. Many councils have had to take out huge loans to manage cash flow crises caused by Send spending. The Chartered Institute of Public Finance and Accountancy estimates the cost of these loans, including interest payments, amounts to around £600m a year, which could have been spent on frontline services. The Send deficit is also eating into other parts of council budgets, with many town halls reporting unsustainable increases in the cost of home to school transport as more children with EHCPs are sent to out-of-borough special schools. The deficits are driven by huge high-needs budgets overspends, especially on education, health and care plans (EHCPs), which set out a council's legal duty to meet a child's educational support requirements. A rapid rise in pupils diagnosed with autistic spectrum disorder, special emotional needs (including ADHD), and speech, language and communication needs has fuelled a 140% increase in EHCPs between 2015 and 2024, from 240,000 to 576,000. Although the 2014 Act clarified entitlement to Send support, critics say the previous government failed to anticipate, plan for, and properly fund and manage the resulting explosion in need and demand. Guardian analysis indicates EHCP demand continues to increase rapidly, with a number of councils reporting 50% rises in the past 12 months. Bradford, already on the edge of effective bankruptcy because of social care pressures, is one of tiny handful of councils currently in surplus on its Send budget. However, it says an expected surge in EHCPs will rapidly turn this into a £14m deficit by March 2026, rising to £54m in 2027. Experts say an extension may delay a local financial meltdown across local government but is unlikely to give councils enough time to tackle the underlying causes of the deficit, which if not mitigated could rise to as much as £8bn by 2029.A Guardian analysis of internal documents and budget reports in over two-thirds of upper-tier English councils, also found: Some councils have raised concerns over profiteering amid frustration over huge fees charged by private specialist schools, which can charge between £50,000 and £100,000 per place, typically two to three times the cost of state provision. Tensions between headteachers and councils over attempts by the latter to shift millions of pounds from local school budgets to ease high needs deficits. Some schools have warned such moves would force them to sack Send support staff. Attempts to rein in local Send demand and spending via 'safety valve' initiatives at 42 councils have largely failed, with most failing to hit savings targets on time, despite receiving government grants running into tens of millions of pounds. A Department for Education spokesperson said the Send system had long been failing to meet the needs of children and families. 'Through our Plan for Change, we are determined to improve inclusivity and expertise in mainstream schools, making sure special schools cater to children with the most complex needs and restoring parents' trust that their child will get the right support. 'We are already making progress by investing £1bn into Send, alongside £740m for councils to create more specialist places in mainstream schools, paving the way for significant, long-term reform.'
