Agenda item

Report ED18035

Members of the Schools’ Forum considered a report providing an update on a recent consultation undertaken with schools regarding the Dedicated Schools Grant 2018/19.  The report also outlined proposals for a further consultation with schools to decide whether the existing Bromley or national funding formula should be used to calculate schools funding for 2018/19. 

The indicative Dedicated Schools Grant 2018/19 was based on 2017/18 pupil numbers and would be uplifted in December 2017 to reflect the October 2017 census.  In terms of the allocation of funding, the Dedicated Schools Grant 2018/19 would be divided into four blocks comprising Early Years, Schools, Central Schools and High Needs.  No information had been published to date regarding the Early Years Block for 2018/19; however it was anticipated that this Block would be balanced as in previous years to ensure that expenditure matched expected income.  Funding for the Schools Block would be calculated using the National Funding Formula funding for each school plus an additional amount based on the Local Authority’s funding for growth and rates outside the National Funding Formula.  A potential shortfall of approximately £164k had been identified within the Central Schools Block for 2018/19, which funded a range of services including Access and Admissions and Schools’ Central Licensing costs, and for which savings would need to be identified by the Local Authority.  There continued to be significant pressure within the High Needs Block due to a number of reasons including an ongoing increase in pupil numbers.  It was hoped that the SEND4Change Review would realise considerable savings within the Block for future years through the transformation of special educational provision, but this was not expected to alleviate the potential shortfall of £1.7M identified within the High Needs Block for 2018/19.

Members were advised that although the Schools Block would be ring-fenced from 2018/19, local authorities retained limited flexibility to transfer up to 0.5% of Schools Block funding to another block, with the approval of the Schools’ Forum or via the submission of a disapplication request to the Secretary of State for Education where the Schools’ Forum was not supportive of the proposal to transfer funds.  Having considered the indicative Dedicated Schools Grant 2018/19, the Local Authority had requested that consultation be undertaken with schools seeking agreement to transfer £1M from the Schools Block to the High Needs Block to reduce the predicted funding shortfall to £700k, which would equate to 0.49% of Schools Block funding.  17 responses had been received to this consultation, three of which had supported the proposal to transfer funds and nine of which were not supportive.  Five respondents had not indicated a preference.  The Secondary Academy Head Teacher noted that as a group, the Secondary Head Teachers were not in favour of the proposal.

The Head of Education, Care and Health Services Finance advised the Schools’ Forum that the budgetary pressures within the High Needs Block had been driven by a significant increase in demand for specialist provision in Bromley as well as the requirement to provide specialist education provision up to 25 years.  Work to reduce the reliance on costly out-of-Borough provision had also increased the demand for in-Borough special school and specialist unit places.  The proposed transfer of £1M from the Schools Block to the High Needs Block could be actioned as a sum to be repaid or as a permanent transfer of funds.  Another alternative to achieve a balanced budget would be to identify savings from within the High Needs Block for 2018/19 which would have a significant impact on the provision of special schools and specialist units.  In response to a question from a Member of the School’s Forum, the Head of Education, Care and Health Services Finance confirmed that it was theoretically possible to run the High Needs Block as a deficit budget with the aim of recouping funds via future savings, but that this would create additional cost pressures for 2019/20 and beyond, and was therefore unlikely to be supported by Local Authority Members.  It was noted that in previous years, surplus funding had been transferred from the High Needs Block to the Schools Block to reduce cost pressures in relation to mainstream education provision.

In discussion, the Primary Maintained Head Teacher was concerned that the current funding settlement did not meet the needs of Bromley schools, including special schools and specialist units for the most vulnerable pupils, and proposed that the shortfall of Dedicated Schools’ Grant funding for 2018/19 be raised with the Local Authority.  This was supported by the Secondary Academy Head Teacher who underlined that pupils in mainstream education should not be disadvantaged by a funding shortfall within the High Needs Block, and that the Local Authority should be approached to fund the shortfall via its reserves.  The Vice-Chairman suggested that the Local Authority might be able to offer some form of ‘bridging’ funding to offset the budget shortfall whilst a more sustainable model of special education provision was put in place.  The Interim Director: Education noted Bromley had traditionally been a high statementing Local Authority in which resources were linked to individual pupils rather than held within the High Needs and Schools Blocks, and there was a need to ensure that the High Needs Block was sufficiently resourced to fund the required specialist provision for the most vulnerable pupils.  The Secondary Academy Head Teacher highlighted that individual Blocks should have separate deficit recovery plans.

The Local Authority’s proposal to transfer £1M from the Schools Block to the High Needs Block was put to the vote.  Of those Members present with voting rights, two Members supported the proposal and three were against it with two abstentions, following which the motion FAILED and it was resolved that the Schools’ Forum would not support the Local Authority’s proposal.

In reviewing the proposal to undertake further consultation with schools to decide whether the existing Bromley or national funding formula should be used to calculate schools funding for 2018/19, Members of the Schools’ Forum considered whether the consultation should use an indicative figure of £197.5M or £198.5M for the Schools Block (dependent on whether the Local Authority chose to submit a disapplication request to the Secretary of State to transfer up to 0.5% of Schools Block funding to the High Needs Block).  The Primary Maintained Head Teacher emphasised the need to encourage schools to support the funding models which delivered the most positive outcomes for the overarching Bromley education offer for children and young people, and the Primary Academy Head Teacher agreed that mainstream and special schools needed to work together more closely.  Following general discussion, Members agreed that schools should be consulted on Options 2, 3, 4, 5 and 6 which provided a range of models using both the existing Bromley and national funding formulas with differing ceilings and Minimum Funding Guarantee amounts.  Members of the Schools’ Forum agreed that consultation should be undertaken on the indicative figure of £198.5M with an explanatory note regarding the potential for a disapplication request to be made to the Secretary of State to transfer up to 0.5% of Schools Block funding to the High Needs Block.  The outcome of the consultation would be reported to the next meeting of the Schools’ Forum on 11^th January 2018.

RESOLVED that:

1)  The report be noted;

2)  Members’ comments on the proposed request by the Local Authority to dis-apply EFA Regulations be noted; and,

3)  The proposal to consult with schools regarding the introduction of the National Funding Formula be agreed;

4)  The proposal to transfer £1M from the Schools Block to the High Needs block not be agreed.