Small child with SEND

Report outlines financial instability of SEND system

A new report from the National Audit Office has outlined how England’s special educational needs system is in need of urgent reform.

This comes as the report – titled Support for Children and Young People with Special Educational Needs – finds that SEND services are failing to deliver improved outcomes for children and young people, and are not financially sustainable, with an increase in demand for support for children with special educational needs and disabilities. According to the report, the increase in children with an Education, Health and Care plan increased by 140% between 2015 and 2024.

According to the NAO, this increase was mainly related to three areas:

  • Autistic spectrum disorders
  • Speech, language and communication needs
  • Social, emotional and mental health needs

Over the course of the last ten years, there has been a 58% increase in high-needs funding, with this sitting at £10.7 billion for this current year. Despite this, the independent public spending watchdog’s latest report has found that local authority dedicated schools grant deficits could still reach £4.6 billion by March 2025. As reported by Public Sector Executive earlier this week, March 2026 is the time at which the ‘statutory override’ accounting arrangements will end, piling the pressure on local authority budgets – this would leave almost half of all local authorities at risk of effective bankruptcy.

With these struggles mounting, the National Audit Office has recommended that the government shares it plans with local authorities so that they can reach financial stability when the statutory override comes to an end. These plans would include how deficits will be treated, and how the government will manage the wider financial impact on services.

SEND failure QUOTE

Head of the NAO Gareth Davies said:

“Although DfE has increased high-needs funding, the SEN system is still not delivering for children and their families, and DfE’s current actions are unlikely to resolve the challenges.

“The government has not yet identified a solution to manage local authority deficits arising from SEN costs, which ongoing savings programmes will not address.

“Given that the current system costs over £10 billion a year, and that demand for SEN provision is forecast to increase further, government needs to think urgently about how its current investment can be better spent, including through more inclusive education, and developing a cohesive whole system approach.”

Overall, the report brought a number of recommendations for the Department for Education and wider government, with these including:

  • Explicitly consider whole system reform to ensure improvement of outcomes for children with SEN
  • Develop a shared understanding of how supporting SEN should be prioritised
  • Develop a long-term plan for inclusivity across mainstream education

The Local Government Association has also responded to the report from the National Audit Office, with Chair of the Children and Young People Board, Cllr Arooj Shah, saying:

“This report is yet another indictment of a failing SEND system that is not meeting the care and support needs of children with special needs.

“In next week’s Budget we are hoping that the Government will set out how it will reform and adequately fund the SEND system, so children get the support they desperately need.

“In particular we are hoping this will include writing off all high-needs deficits to ensure councils are not faced with having to cut other services to balance budgets through no fault of their own, or their residents. With councils currently able to keep these off their balance sheets, we have serious concerns that many will face a financial cliff-edge, when this flexibility ends in March 2026.”

 

Image credit: iStock

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