Agenda item

Report CEF21054

The report provided an outline of the estimated Dedicated Schools Grant (DSG) allocation for 2022/23 and an overview of how this would be spent.

The indicative Dedicated Schools Grant (DSG) funding for 2022/23 had been provided to all Local Authorities – this was based on October 2020 pupil numbers and would be uplifted in December to reflect the October 2021 census data. The DSG for 2022/23 was divided into four blocks – High Needs, Early Years, Schools and Schools Central. The table below sets out the expected outcome:

The Local Authority (LA) had looked at each of the blocks and forecast the related expenditure for 2022/23 based on information currently available. Full details of the projected grant income and expenditure were set out in Appendix 1 of the report with information concerning each block provided in the body of the report.

The Forum noted that an update to Appendix 1 of the report had previously been circulated.

Introducing the report, the Head of Children, Education and Families Finance explained that the funding set out was indicative and further information and confirmation would be received in December 2021.  Whilst there had been an overall increase in grant, this was offset by increases in demand and expenditure across the board, particularly in High Needs.

Schools Central Block

The grant itself would reduce, a year-on-year reduction from DfE of approximately 2.5% overall.  The Council were continuing to contribute to support the central spend within the LA.  The intention was that there would be an additional £50k contribution from the Council resulting in an overall contribution of £460k.  It was anticipated that the block would be balanced.

Early Years Block

No data regarding the Early Years Block had been received.  The funding allocation allowed for £500k in the Early Years Block for Early Years High Needs provision.  It was anticipated that the block would be balanced.

In response to a question, the Head of CEF Finance confirmed that delays to receipt of information concerning Early Years funding occurred every year.  It was unlikely that information would be received until December 2021.

Schools’ Block

Figures were based on October 2020 census data and would be updated in due course.  There were some minor changes around the NFF although the LA had been following the NFF as far as possible.  The primary units of funding and secondar units of funding were increasing and this would feed into the grant allocation.  The LA was anticipating a MFG level from between 0.5% and 2% as suggested by DfE although this was subject to change.

Based on current information, 23 Primary Schools were eligible for minimum funding levels which accounted for about £1.7m, this being subject to change when actual funding and pupil numbers were used in the final calculations.  Previous years had been reviewed and the number of primary schools had decreased as had the amount received.  MFG across all schools had decreased to around £2.4m and the issues around minimum funding protection would continue into the longer term.

High Needs Block

It was likely that considerable amounts of additional funding would be received although this would be offset by the even more considerable pressures within the block.  The Forum noted the overall DSG deficit coming in the current financial year and it was likely that it would increase by the end of the financial year.  Steps would need to be taken to address the deficit and it was likely that a deficit recovery plan would be required.  Any deficit recovery plan would be considered by the Forum.  The LA was not permitted to contribute to the High Needs Block whereas in previous years there had been a contribution.  There would continue to be pressures within the block.

The Forum noted that future funding settlements for 2022/23 and beyond had not been announced.

In response to a question, the Head of CEF Finance conformed that there was a roughly £6m increase in funding for the High Needs Block.  In terms of the other grants, funding for the Early Years Block had not been confirmed.  The Central Services Block would have decreased, and the Schools Block would have increased and information on the increases could be provided following the meeting.

The Forum noted that both the primary unit of funding and the secondary unit of funding had increased.  However, primaries and secondaries were funded through the NFF which was slightly different.  There was also some lag with funding which also created some issues.  There would be a minimum of 0.5% and a maximum of 2% in terms of the MFG and that was based on a per pupil level.  Further work would be done on this in due course.

The Forum noted that the DSG deficit, whilst fairly new, had been reflected in the 2020/21 Outturn Report.  Due to the increasing pressures in the High Needs Block the deficit was likely to increase and it was likely that some difficult decision would need to be taken in order to address the deficit.  The Director of Education highlighted that the DSG deficit and the need for a recovery plan had been reported to both the Schools’ Forum and the SEND Governance Board.  Projecting the level of deficit was very difficult when the LA continued to receive one-year settlements.  Whilst the provisional increases in High Needs funding sounded significant, the reality was that a similar amount had been received in 2021/22 and it was not enough to keep pace with the increased demands within the High Needs Block.  With the current resourcing arrangements, the deficit would only grow and there would be a need to look towards future sustainability before the point at which the LA would be required by the DfE to recover the deficit.  The legal position was that the LA would not be able to top up the funding and this was something that would require detailed consideration.

The Forum noted that Mr Ian Travis had previously submitted a similar question, and this had been addressed in the response above provided by the Director of Education.

In response to a question concerning the SEND Review in 2017 and the need to reduce spending on out-of-borough placements, the Director of Education, confirmed that this remained a key area of priority.  There was an acknowledgement of the need to increase in-borough capacity for both mainstream and specialist places in future years.  However, the 17% year-on-year increase in EHCPs coupled with incredible increases in complexity was leading to placements which could not be made within the Borough.

The Director of Education highlighted that the LA received very little in terms of Basic Need resource each year and this inhibited the ability of the LA to invest in either mainstream or specialist provision.  The LA continually looked at other ways to seek to make this investment including use of development contributions coming through the system such as the Community Infrastructure Levy, but the challenge remained when adequate capital monies were not received.

In response to a question from the Chairman, the Head of CEF Finance confirmed that at the end of 2021/22 it was anticipated that the deficit would have increased, and the LA was working to limit the impact as far as possible.  The Forum noted that unprecedented demands and pressures remained in the High Needs Block and the expectation of the DfE was that the deficit was recovered.  It was noted that Bromley was not alone in finding itself in this position and there were other LAs in far worse situations, with Bromley being one of the last LAs in London to reach a deficit position.  The coming months and years would undoubtedly be difficult as there was no short-term fix.  The Director of Education confirmed that there was a very real risk that the £4m deficit worsened before it improved.  There was a need to look at a number of mitigating actions before the DfE required a deficit recovery plan to be put in place.  The LA were having to look at future sustainability and the need for the Special Free School was clear.  Another real risk to future sustainability was around the inadequacies of the current statutory framework around SEN and in particular tribunals and appeals.  These were leading all too often to high-cost placements being required and implemented by a tribunal judgement.  The Forum noted that the promised national SEND Review had been repeatedly delayed but until there was a significant shift in the national position resulting in systemic change, the pressures for all LAs would continue.

RESOLVED: That the report be noted.