Councils breach funding rules (again) due to SEND deficits

England’s largest council has been given government permission to breach the minimum funding levels for schools for the fourth year in a row.

The average–sized primary school in Kent could be £12,780 worse off as a result.

Two other cash-strapped councils – North Tyneside and York – were also given permission to go below the national minimum per-pupil funding levels (MPPFLs).

Councils argued this was necessary to ensure there was no “unequal distribution” of funding after they moved schools’ cash into the high–needs pot to plug ballooning deficits.

But experts warned it was a “sticking plaster” solution to what was“fundamentally wrong”.

‘Harder to absorb’

Since 2020, councils have been required to follow MPPFLs, but ministers can sign off requests to go below this.

The MPPFLs for 2026-27 are £5,115 per primary pupil, £6,388 per key stage 3 pupil, and £7,018 per key stage 4 pupil.

In Kent, primaries received £46 less than national levels, while secondaries received £57 less for key stage 3 pupils and £63 less for key stage 4 pupils.

This was after transferring £16.5 million out of its school budget to its high–needs pot – the largest of any block transfers in England.

The council was expected to face a £136 million cumulative SEND deficit by March.

Frazer Westmorland, a Kent school governor and former headteacher of Mundella Primary School in Folkestone, said there was a legitimate argument for smoothing or levelling funding across schools “to maintain wider system sustainability and avoid extreme disparities. 

“But where schools are simultaneously managing rising SEND demand, staffing pressures and inflationary costs, repeated reductions below minimum funding expectations inevitably become harder to absorb.”

Kent did not respond to requests for comment.

Schools Week previously exposed how 21 councils were given ministerial go-ahead to transfer a combined £75.5 million from mainstream budgets into their high–needs pots for 2026-27.

The transfers were agreed as part of “safety valve” deals – where councils receive government bailouts in exchange for sweeping reforms.

This scheme was cancelled in March and instead councils have been asked to draw up “local SEND reform plans”. Town halls with approved plans will have 90 per cent of historic deficits wiped.

But ministers are mulling changes to the controversial transfers policy. Its white paper also set out ambitions to “re-balance funding” by directing more high–needs cash into school budgets.

More ‘equitable’ way needed

North Tyneside breached minimum funding for the second year, with £26 less per primary pupil, £32 less per key stage 3 pupil, and £35 less per key stage 4 pupil.

After 0.5 per cent of the budget – £800,000 – was moved in 2025-26, North Tyneside’s schools forum noticed some schools experienced greater impact than others.

David Watson, forum chair and headteacher of St Thomas More Catholic High School in North Shields, said some schools were not impacted “at all” by the 0.5 per cent.

When it became apparent that this would happen again “we agreed that … a more equitable way of taking the 0.5 per cent should be found”.

Watson said it meant most schools experienced a 0.4 to 0.6 per cent cut this year, which was “certainly not the extreme that happened before”.

York schools forum also had “concerns about the distributions of the transfer across all mainstream schools”, according to Maxine Squire, its assistant director of education and skills.

Modelling presented to the forum showed “unequal distribution” after 0.5 per cent of the schools block was moved, which was “significantly reduced” by lowering the minimum per-pupil funding.

“This demonstrates a much more equitable distribution of the impact of the transfer across all schools and is the option that both the LA and all members of the school’s forum wanted to implement,” Squire said.

While North Tyneside offered the same explanation, David Mason, its head of finance, said the block transfers or applications to reduce per pupil funding was not expected to continue beyond 2026-27.

Amanda Watkins, an education consultant, said while “anything done in a fair way is OK,” it was a “sticking plaster” solution to something that was fundamentally wrong.

Improvement notices lifted

It comes as the DfE has lifted improvement notices issued to Plymouth, Oxfordshire and Oldham councils.

All three were given notices to improve after significant failings were found in their SEND provision in 2023. 

In April, Bridget Phillipson, the education secretary, wrote to Plymouth recognising its “significant commitment, determination and hard work”,

She said Oxfordshire had improved communication and information sharing across the local area partnership.