Agenda item

Elizabeth Griffiths introduced the report (Agenda Item 11), which reported the forecast financial position of the services funded by the Dedicated Schools Grant (DSG) for 2025/26, highlighting any under or overspends, and highlighted the cumulative deficit on the DSG.

The report provided the position at Q1 meaning there was a level of uncertainty. The key point to note was that there was a savings target of £14 million, which was the balancing item between expenditure agreed for the DSG and the amount of funding in the DSG. At Q1, no savings had been identified to contribute towards that £14 million. This was the main area that needed to be looked at and mitigated later on in the year.

Elizabeth Griffiths added that they had closed 2024-25 with a cumulative deficit on the DSG of £16 million. If the £14 million remained unmitigated, the deficit would reach £30 million by the end of the year.

Trevor Keable asked for the deficit to be put into perspective compared with other education budgets. Elizabeth Griffiths responded that there were budgets under pressure across the Council, but the DSG deficit for 2024/25 had been equivalent to the deficit across the rest of the Council as a whole. Trevor Keable further asked if the Forum was being asked to do something about it. Elizabeth Griffiths said that the report was for noting however, she had needed to draw attention to the savings target of £14 million, and she was concerned that at Q1 there was no plan to deliver those savings and would like to see some proposals. Trevor Keeble asked if the Forum should be a "pressure group" to address the deficit. Elizabeth Griffiths stated that it was hopeful that something could come forward from the Schools’ Team and the Schools’ Forum to help mitigate the overspend.

The Chair invited Neil Goddard to comment, and he reiterated that they were extremely dependent on the anticipated announcement from the Government and their approach to managing the overall SEND budget. He added that once this announcement came out, the Schools’ Forum would have a key role to play in understanding the implications within the local area. Prior to this point it could be demonstrated how funding was being spent, and he commented that the vast majority of the DSG went to schools. Nationally there did not seem to be an obvious solution and West Berkshire was experiencing the same pressures as other LAs, some of which were facing larger deficits. It was important to demonstrate that the money was being spent as efficiently as possible.

Councillor Iain Cottingham highlighted the "snowball effect" of the DSG overspend, projecting a deficit of £73 million by 2027-28. This meant that all borrowing by the LA in 2027/28 would be funding deficit and there would be no funding for capital projects. It was a huge issue for the LA as well as educational professionals and the potential impact upon residents of West Berkshire was very concerning. It was a matter that needed to be grasped by Government.

David Ramsden called for a deficit recovery plan and did not feel they could wait for the Government’s announcement. This could then be adjusted accordingly once any announcement was made. He queried if the LA had a deficit recovery plan for the DSG. Neil Goddard stated the DBV plan was the deficit recovery plan, and it had been effective in reducing the rate of increase. He could not put a deficit recovery plan before the Forum that would balance the budget whilst remaining within legally set boundaries. A huge percentage of the DSG went to schools. It was difficult to reduce the amount given to mainstream or special schools as they were already struggling. The aim was to give less to non-maintained independent special schools, and this was how sufficiency was being created. The plan was to spend money as efficiently as possible and focused on sufficiently, and the SEND recovery plan, but this would not balance the budget.

David Ramsden suggested a 10 or 15 year deficit recovery plan was better than nothing. He felt that delaying the statutory override was cowardice on the part of the Government as it did not help anyone. In the meantime, they needed to show to the DfE that they had a plan in place. Neil Goddard reported that there were a set of principles that were applied including early intervention. Statutory areas did not generally include early help services. The dilemma was that if they did not provide early help then need would continue to increase but if early help services were provided then there was not enough money in year one. Managing these elements was a huge dilemma. Neil Goddard reported that the HNB proposed budget would come back to Forum in the autumn and at this point there could be a conversation about where resources could be redirected to help manage the budget.

Paul Davey asked for indication on when information was expected to come out from the Government, to which Neil Goddard felt it was difficult to predict but estimated some information would come forward by the end of the year.

Councillor Iain Cottingham stated that there needed to be more of a fundamental discussion as a country on how social care was funded and that the funding needed to be looked at to ensure best value. He shared the frustration raised by members of the Forum.

Edwin Towell acknowledged the challenges facing the LA but agreed there had been a lack of a plan for a very long period of time. He felt that a 10 or 15 year deficit recovery plan would be reasonable. He understood that the plan was to bring services in house that were currently contracted out to expensive independent special needs provision however, he felt that the lack of a plan was frustrating and it was a concern that there had not been a plan in place for a deficit that had been ballooning over a number of years. There was other LAs with deficit budgets in education and elsewhere that were increasing Council Tax. He appreciated it was not the time to have a discussion about Council Tax, which was a much wider issue, but he was concerned that the lack of a clear plan would have much larger implications.

Neil Goddard understood the frustrations raised. DBV was the plan and had been a huge piece of work. The plan formed as part of this was being executed. The SEND Strategy set out early intervention as the approach to longer term deficit reduction. Neil Goddard understood that they were not able to spend Council Tax on the HNB or other DSG areas. Any income was limited to the HNB. Neil Goddard stressed that he would not be able to put a long term plan in front of the Forum that could bring the DSG back into balance that was realistic. He was happy to work with the Forum and go through it in as much detail as possible if they wished. Elizabeth Griffiths clarified that LAs were capped regarding what they could raise through Council Tax unless a referendum was held, which was unlikely to be successful.

Trevor Keable enquired if the Forum should formally ask for a plan to be brought to a future meeting. Neil Goddard responded that the HNB budget would be brought to the Forum in the autumn for scrutiny. This would support the need for a being a joined up and transparent plan going forward that was trackable through the systems in place.

RESOLVED that

• It was noted that the HNB budget would be brought to the Schools’ Forum in the Autumn.
• The Schools’ Forum noted the report.