Agenda item

The Head of Finance (Children, Education and Families) introduced the report on the 2024/25 provisional allocation of the Dedicated Schools Grant (DSG) and highlighted the latest figures from the DfE and the effects for Bromley. The figures were indicative at present and would be updated in December once the DfE had gone through the October census. The DSG allocation was divided into four blocks, as shown in Section 3.1 of the report.

Within the Schools Central block the grant was expected to fall by a further 2.5%, with similar decreases expected for the next 2 to 3 years until it reached the DfE’s expectation of Bromley’s Schools Central spend. Bromley were looking at ways in which to limit the spend in this area, with the DfE’s allocation based on a National average.

The grant within the Early Years Block had been estimated using current usage and rates held by the DfE. There was an announcement from the DfE on 29^th November regarding an increase in rates to £6.40 for 3-4 year-olds and £9.44 for 2 year-olds. The current report was published before the new rates were announced, but they would be factored in for January’s budget information.

Regarding the Schools Block, the Schools’ Forum heard that some increases had been seen within the Primary and Secondary units of funding. However, it should be noted that mainstream schools would have received the Mainstream Schools Additional Grant (MSAG) distributed in 2023/24, and this was included in the DfE’s allocation.

Finally, within the High Needs Block, it was highlighted by the Head of Finance (CEF) that, as with previous years, it was the area under the most pressure. More grant had been received but Bromley’s expenditure exceeds that and a deficit of £5.6m is expected for 2024/25. Bromley were looking at ways in which this could be reduced, but there were significant ongoing pressures.

Concerning the pressures within this area, The Head of Strategic Place Planning (Education, Care and Health Services) then explained to the Forum that it appeared that Bromley’s rate of new EHCPs (Education, Health and Care Plans) had slowed, but looking at the census for 2022 and 2023, numbers were roughly the same. Whilst there had been some slowing in the EHCPs, numbers were still significantly higher than pre-2020.

Appendix 1 of the report (pages 11-12) showed an indication of the allocation of Bromley’s funding, and this would change once the DfE announced funding towards the end of December, and also taking into account the DfE’s announcement on 29^th November. Appendix 2 (pages 13-16) showed provisional funding calculations, but again these figures would change in due course.

In response to a question, the Head of Finance (CEF) confirmed that budgets were not being set at present, but in January 2024 there would be more information available for a clearer picture of Bromley’s position and what the proposals were. Comparisons could then be made with previous years etc and the Schools’ Forum would be able to discuss the position further.

A Forum Member raised a question regarding any impact the opening of the Borough’s Free School would have on funding within the High Needs Block. In response, the Head of Finance (CEF) confirmed that funding within this block was based on formula such as pupil numbers, deprivation etc. The Free School would have pupils who would have entered school elsewhere, and the Borough would actually be paying less per pupil in the Free School than in an independent setting, and in theory this would help the funding position.

Regarding increased costs within the High Needs Block, the Forum noted that Bromley was trying to increase the amount of in-house provision as it was cheaper than independent, but it was a slow process. However, sometimes there was no alternative when children needed to be placed in the appropriate setting. The Head of Finance (CEF) confirmed that the Borough was trying to do as much as possible to bring the deficit down - £5.6m predicted for 2024/25 and £4m for 2023/24. High Needs funding was not only a Bromley issue, but also a National one, but Bromley remained in a better position than a lot of other LAs.

The Head of Strategic Place Planning (Education, Care and Health Services) informed the Forum that once a child had gone out to an independent placement, it was hard to bring them back to in-house provision. It was a process of trying to reduce long-term out of borough placements, and the Free School will be key in this but will need time to grow in terms of pupil numbers.

The Forum heard that Bromley was currently meeting with over 30 schools/sites looking at the potential to expand capacity to create more in-borough provision. Funding was available for some proposals, but the Borough would also need to wait for future capital allocations from the DfE to support the plans. A major frustration for Bromley was that the DfE would not currently allow the Free School to open, even in temporary accommodation, until planning concerns had been resolved. The Head of Finance (CEF) view was supported in that it was the LA’s policy to keep children supported locally rather than out of borough and into independent settings.

In response to a question regarding the deficit within the DSG, and primarily the High Needs Block, the Head of Finance (CEF) informed members that there had been deficits for the last few years. Entering the current financial year there was a cumulative deficit of £12m, with an additional £4m forecast and £5m for 2024/25. Due to the high level of their DSG deficit some LAs had entered special arrangements with the Government to manage the position. Bromley were not currently near this position with the DfE and had asked the DfE if there was anything further that could be done, but the DfE’s response had not been helpful. However, the DSG deficits remained an ongoing issue.

It was again highlighted to the Forum that the figures were illustrative at the moment and would change with more up-to-date information, pupil numbers etc and actual figures would be produced at the Schools’ Forum meeting in January. However it was not felt that there would be a significant change to the deficit figures, with the report showing where the pressures were and the issues Bromley was facing.

The Head of Finance (CEF) explained that Bromley reported to the DfE what the deficits were so they were aware of the position, and the deficits were also shown in Bromley’s accounts. Discussions had taken place regarding a Deficit Recovery Plan, but the LA was not currently in a position where any special action was required. The LA was still looking at what measures might be possible to recover the deficit position, with the Forum recognising the difficulty and challenge in seeing where savings or cuts could be made.

RESOLVED: That the provisional DSG income and forecast expenditure for 2024/25 be noted.