Agenda item

To receive and consider the High Needs Block Budget 2022/23 report.

Katherine Vernon informed that in 2022/23 there was extra funding for the HNB of around £2.4m and a supplementary grant of £900k.  However, with the increase in the number of EHCPs, and taking into account all the information that was available, a deficit of around £3m was projected for next year.

During her presentation she made the following comments:

·           It was proposed to increase the top-up rate for mainstream schools by 4%, with the hourly rate now being £461.24;

·           A review of 27 post-16 places which were funded from the HNB in Wokingham’s mainstream schools was taking place, Schools Forum would be informed of the outcome of this review;

·           The funding for Addington School was being kept at current levels, as the school had a carry forward.  It was noted that leaders at Addington School were not happy with this arrangement;

·           Chiltern Way was continuing with the same funding;

·           Non-maintained schools represented 32% of the HNB Budget, this was likely to keep increasing whilst there was insufficient provision in the Borough;

·           Education for Post-16 (up to 25 years old), the numbers were stable;

·           The budget for Foundry College covered their expenses and the school would receive additional funding from schools as a traded service;

·           The budget for Children and Young People Integrated Therapies (CYPIT) was based on existing contract information, any changes would be reported to Forum.

During the discussion of the item the following comments were made:

·           Sara Attra, Addington School - stated that they were disappointed to be the only school to not receive an uplift this year.  The school had reserves, but the only reason the school had reserves was because they had not been given an uplift for seven years (apart from last year), they had to be very cautions as they never knew if they would get additional funding;

·           Sara Attra wished it to be recorded that 87% of their budget went on staffing.  Staffing costs rise year on year, and because of no uplift, she anticipated that the school would go into deficit next year.  If no uplifts were given there would be a deficit of £685k by year 4 and in year 5 a deficit of £1,675m.  Reserves had not been used on staffing, if the school could have the money they would spend it on therapy provision which would stop some of the out of borough placements;

·           Sara Attra emphasised that she predicted an in-year deficit next year.  The budget for Addington also included income from other local authorities as traded services.  However, as there had not been an uplift in funding, Addington could not increase the charges for their services to other local authorities as they were not allowed to have differential charging between local authoties;

·           In response to a question Katherine Vernon stated that schools’ reserves were not in the HNB, they were treated separately as were maintained schools’ balances;

·           Sara Attra explained that she understood that the HNB was severely overspent, however she requested an annual review of Addington funding and a consultation with SEND and Finance;

·           Ginny Rhodes expressed concern about the Addington situation, she felt it was regretful that Addington could not charge other local authorities differently.  She believed that the cost of SEN provision at schools would go up as a result of the raise in cost of living.  She feared that schools would no longer be able to rely on easy staff recruitment.  She asked if it was too late to change the funding for Addington, she felt that Wokingham would effectively be funding places for other local authorities as a result of the lack of an uplift in funding.  She wondered if this was setting a perverse precedent for maintained schools, where they would end up spending their reserves because of the lack of security of adequate future funding;

·           Katherine Vernon stated that it was possible, following discussions with Addington, to change the budget mid-year;

·           The Chairman asked why the full cost of funding Addington had not been reflected in the HNB budget, especially given the context of the overall significant budgeted overspend and the recent movement due to mistakes  in forecast planning;

·           The Chairman pointed out, that following a review, the budget for Foundry College had risen by 63% this year, he questioned why the same approach had not been taken for Addington;

·           Katherine Vernon stated that the income from 40-50 pupils that Addington received from other local authorities was not included in the figures in the  report;

·           The Chairman asked what assumptions had been made this year in relation to the number of EHCPs, in view of the learning from last year (that the assumption had been too conservative on the average cost profile);

·           Katherine Vernon stated that to start the year, in independent non-maintained special schools there were 164 places, this was expected to go up to 191;

·           Katherine Vernon stated that the estimate had gone up by £800k, but she did not have the average cost to hand;

·           The Chairman asked that those assumptions be shared with Schools Forum;, he also asked what assumptions had been taken for inflation for Out of Borough places;

·           The Chairman asked if the likelihood that Out of Borough independent providers may increase their rates further, in view of the extra funding announced for local authorities had been given extra funding, had been taken into account in the planning;

·           Katherine Vernon explained that there was an uplift process with the commissioning team, which Out of Borough independent providers had to follow;

·           The Chairman asked for information about the assumptions made for the external income received by Foundry College.  Katherine Vernon informed that Lynn Samuel had been dealing with that and she apologised that she did not have that information to hand;

·           Shirley Austin pointed out that the DfE had proposed some changes to teachers pay over the next two years which involved significant increases.  Sara Attra confirmed that she was aware and had used that information in her planning;

·           Shirley Austin shared Ginny Rhodes’ concern that Addington was not able to charge differently to other local authorities;

·           Sara Attra asked if there was any contingency planning in SEND for requests for residential placements.  She believed that there was one such request at least once a year, which could amount to £200k per pupil.  She anticipated an increase in the number of requests for residential places due to the pressures the pandemic had placed on families;

·           Daniel Robinson stated that the Complex Case Referral provided that Social Care and Health paid for most of those cases.

Katherine Vernon informed that this year the Council was in conversations with the DfE about submitting an unbalanced budget, to reflect the reality of the situation. 

Carole Simpson asked how confident Officers felt about the HNB Budget, Daniel Robinson explained that the budget included all the information that was available at this point in time.  There was concerned voiced about the lack of local provision and possible increase in demand.

The Chairman asked why a more realistic budget for Addington was not being submitted, given that the budget being submitted to the DfE was going to be unbalanced.

Daniel Robinson explained there had been conversations with senior leaders about the proposed HNB budget, and also with the DfE.  The DfE requested a ‘reasonable’ budget and not the worse case scenario.  There was awareness of the fact that the budget did not allow for a safety valve and the conversations were ongoing.

Ben Godber shared the concerns raised during discussions, and asked how the growing number of EHCPs was being factored into the budget planning.  Daniel Robinson explained that the average number of EHCPs per month was used in calculations.

Corrina Gillard expressed concern about the budget as presented, however she added that the Improvement Board was looking at placements for under 5 year olds in an effort to alleviate pressures.

Brian Prebble also expressed concern about the budget as presented.  Daniel Robinson offered to share with the Forum in July details of how the finance team projected and calculate the spend on EHCPs.

Upon being put to the vote, 9 members voted in favour of the HNB Budget and 7 voted against.  Some of the members who voted in favour stated that they were in favour, provided that a deficit budget was submitted to the DfE.

RESOLVED That:

1)     Schools Forum approves the HNB Budget;

2)     The HNB Budget submission to the DfE includes the deficit as presented;

3)     It was recognised that the numbers in the Budget were not reflective of the likely outcomes during the year.