Agenda item

Jane Moore introduced the report which builds upon the presentation from the Schools’ Forum meeting on 24 September setting out the position in terms of high needs provision and presents the proposals for the High Needs Recovery Plan.

Jane gave explained that nationally there are growing concerns over the high needs block and high needs deficiency across the country.  Paragraphs 8 and 9 give the key issues which were founded by the Association of Directors of Children’s Services and National Association of Headteachers.  There are indications that the DfE are aware of the financial pressures but have yet to provide a solution.

For Leicestershire, the High Needs Block Dedicated Schools Grant budget for 2017/18 was £61m and overspent by £1.1m.  At the end of Period 6 for this financial year the projected overspend on the high needs block was £3.6m.  The DSG reserve is £2.2m resulting in an overall deficit of £1.4m.  As outlined in the report, Jane highlighted the factors that the overspend relates to and the system wide issues in how the funding is determined.  This increase in overspend sits alongside a backdrop of a number of key issues which are outlined in the report.  Jane stated that the projected increase in provision demand over the next 5 years is 22% and based on a number of factors, the expected financial position to 2022/23 is a £44m cumulative deficit if no actions are taken which is financially unsustainable and therefore not an option.

Jane stated that through expansion of current provision and the development of new provision it is possible to reduce the high needs overspend and in time, estimated to be 2023/24, result in expenditure being brought into line with the grant.

The table in paragraph 16.3 sets out the deficit plan in order to reduce the overspend by 2022/23.  Jane acknowledged the huge financial risks associated with the recovery plan which is outlined in paragraph 16.4.  Leicestershire is one of the few local authorities that have not implemented a transfer of funding from the schools to the high needs block for 2018/19 or considering doing so for 2019/20.  Jane stated that most other local authorities high needs recovery plans are not being delivered through Invest to Save schemes but are cutting services and moving funding from other blocks.

Jane referred to paragraph 17 which outlined the focussed activities for the recovery plan, the third one being the area where most of the costs will be.  Jane outlined the provisional plan that has been developed to significantly grow Leicestershire SEN provision.  The closing date for expressions of interest from schools to develop specialist provision is Friday 30 November 2018. 

In order to manage the deficit approval will be sought from the Schools’ Forum annually to carry forward the deficit in line with the requirements of the terms and conditions of grant.  The local authority is also required to report annually to the DfE to bring DSG expenditure in line with the grant.  A report is to be presented to Cabinet in December to seek approval to conduct a formal consultation process.

Chris Parkinson asked if the cumulative surplus would fund the high needs overspend and asked what the future need was.  Jenny said that we are dependent on being able to predict the rate of housing growth. 

Jenny Lawrence added that these are two issues that need to managed alongside each other; it is not acceptable for local authorities to have a high needs deficit funded by school growth, the local authority plans to ‘bank’ unallocated school growth allocations as the need is a future one and allocations are uncertain. The local authority has a statutory duty to meet the cost of school growth and this DSG allocation is outside the NFF. 

Jean Lewis asked how the EHCP’s will be controlled.  Jenny stated that the control of EHCPs is not a recovery plan action.  If support is put in earlier on and not be reliant on an EHCP, and be better at localised conversations around pupil needs and inclusion is effective it should slow down the number of EHCP’s.  Chris Swan asked about the strategy to look at the need to reduce EHCPs.  Jane stated that the use of EHCP’s in schools should not be relied upon for money.  There is a significant growth bid in the SENA Service to deal with the EHCP’s; the idea is not to stop EHCP’s but to consider how schools may assess appropriate levels of funding without the need for a plan.

Schools’ Forum expressed concern that health funding for EHCP’s remains an issue.  Jane commented that conversations have been taking place with health colleagues for a long period of time and may need to obtain a legal view on what health should be funding.  A comment was made that health are advising schools to make staff redundant to fund the health intervention.

Chris Parkinson commended the Director of Children’s Services and colleagues for taking this approach.  Chris stated that this is a national issue but there must be opportunity for the local authority to drive costs down from independent drivers and to work with the private sector.  Jane stated that the private sector have a powerful stand in the market as they know these children have to be placed and local authorities have little choice, as a result the bargaining power rests with the private sector . 

Schools’ Forum noted and supported the proposals set out for the High Needs Recovery Plan.

Schools’ Forum noted the financial model within the High Needs Recovery Plan.

Schools’ Forum noted and supported the arrangements for the management of the Dedicated Schools Grant deficit.

Schools’ Forum approved the carry forward of the estimated 2018/19 Dedicated Schools Grant deficit to 2019/20.  (14 in favour with one abstention).