Council cost pressures threaten SEND ‘safety valve’ reforms

Local authorities handed bailout cash warn they may fail to meet conditions as inflation and other issues bite

Local authorities handed bailout cash warn they may fail to meet conditions as inflation and other issues bite

23 Sep 2022, 5:00

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Cash-strapped councils have warned that inflation, staffing shortages and construction delays risk undermining a cost-cutting drive that is a key plank of major new SEND reforms.

Fourteen councils have been given “safety valve” bailouts totalling nearly £100 million to plug financial blackholes in their high-need budgets.

In exchange, they must agree sweeping reforms to make their special educational needs and disability provision “sustainable”, and report back to the government on their progress.

Reports from seven councils, obtained under freedom of information laws, show several warning that they might fail to meet their bailout conditions.

At least one recently predicted it would also miss deficit-cutting targets.

The “safety valve” programme was introduced last year as some councils’ deficits were so large that the government acknowledged “urgent” help was needed to put them on a sound footing before implementing widespread reforms, outlined in the SEND green paper.

The Department for Education has already temporarily withheld £2 million from two bailed-out councils earlier this year.

Other authorities’ circumstances remain opaque as the government refused to release reports, warning it might encourage councils to “downplay risks”.

Specialist schools hiking fees by up to 10%

Kingston in south-west London warned in June it would spend £740,000 more than allowed.

Neighbouring Richmond, which merged children’s services with Kingston, does not expect to breach overall deficit limits, but warned that it risked not hitting one commissioning savings target.

Together they warned that 40 state and independent specialist providers were hiking fees by up to 10 per cent.

Providers highlighted “cost of living” inflation, and teacher pension and health and care levy costs.

Such pressures come on top of regional place shortages “creating probably the biggest threat to meeting the terms of the safety valve agreement”.

Dorset County Council said deficit reduction was “on track” this year, but inflation “may impact future performance”, as this is when “the majority of fee changes happen”.

South Gloucestershire highlighted “success” curbing its deficit, and the number of independent and non-maintained placements.

But average weekly placement costs were up 6.4 per cent to £1,710, partly due to “increased cost of living”.

“Even independent schools who were always OK for funding are having a huge drive to raise funds,” said Laxmi Patel, a partner and SEND specialist at law firm Boyes Turner. “The situation’s dire.” Five councils said recruitment was making agreed reforms harder.

Schools cancel SEND contracts with council

Staffing shortages led ten independent schools to terminate contracts with South Gloucestershire council for particularly complex children last year.

Meanwhile South Gloucestershire told the government high vacancies in its own education health and care teams posed a “risk to delivery of the safety valve deficit recovery plan”.

But a spokesperson said it was now “confident” of filling them. Richmond and Kingston highlighted the “inability to recruit” therapists, psychologists, SEND case workers and teaching assistants.

It risked “a struggle to deliver statutory duties in a timely manner”, and “insufficient capacity” to drive reform. Staffing “retention and capacity” was top of York’s risk register, though the council told Schools Week its plans remained “on track”.

Salford called speech and language therapy recruitment “challenging”.

Three councils also highlighted amber or red risk ratings over hitting targets on special school construction, urging the DfE itself to accelerate plans.

Tom Rees, the founder of learning disability charity Upsndowns and Ambition Institute executive director, said Schools Week’s findings showed “the need for more wholesale reform and investment” in SEND provision.

Attaching strings ‘not the solution’

Julia Harnden, a funding specialist at the school leaders’ union ASCL, said expecting council prudence was “reasonable”, but added: “Attaching strings over cost pressures that are not in the power of local authorities to control is not the solution, and it risks damaging the provision needed by the most vulnerable children.”

But John Fowler, the policy manager at the Local Government Intelligence Unit, said it was “Treasury orthodoxy that you don’t give money for nothing”.

Harnden also called deals a “sticking plaster” for systemic issues. Staffordshire county council documents show it was not offered a bailout, despite reserves being “fully depleted” and its school budget deficit quadrupling last year to £8.6 million.

Jonathan Price, an education cabinet member in the county, said it was still seeking support, adding: “All local authorities need help.”

The DfE recently told Schools Week it was “not currently considering” expanding safety valve beyond another 20 deals now under discussion.

Council documents reveal these include Barnsley, Blackpool, Bolton, Croydon, Devon, Doncaster, Hounslow, Isle of Wight, Kent, Lewisham, Medway, Norfolk, North Somerset, Slough and Southwark.

A DfE spokesperson said concerns in Richmond and Kingston had since been resolved, and councils were “broadly” on track to deliver against targets. “The safety valve programme is working successfully.

As with all intervention programmes we are monitoring councils carefully, and we actively encourage them to flag all potential risks, but we remain confident that the councils involved will secure sustainable management of their high needs systems.”

She added that inflation was ” global issue”, but the chancellor’s growth plan would help reduce it.

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