Agenda item

DECLARATIONS OF INTEREST

In accordance with the Localism Act 2011, and the Council’s Code of Conduct, Members to disclose any personal or pecuniary interests in any matter included on the agenda for this meeting.

NOTE:  Members are reminded that, where applicable, they must complete the appropriate form recording details of any such interests and hand it to the Meeting Support Officer.

JD advised that a Secondary School Governor Rep. was required although the balance remains with the Primary Schools. JD suggested that the Secondary Schools nominate a Secondary Governor Rep. 

HIGH NEEDS DEFICIT WORKING PARTY UPDATE(TM)

·  Papers for Information and discussion

TM gave an overview of the discussions from the high needs meeting and requested Schools Forum thoughts moving forward as part of the consultation. The High Needs working party was set up to make recommendations to Schools Forum and was made up of reps from both Schools Forum and schools across the city to look at

·  Firstly: The pressure on the High Needs budget that has accrued deficits of 9.3M.

·  Secondly: the historic lack of transparency around how the High Needs budget is used.

The working party looked at the increasing complexity of need in the city. In 2014 the government brought in new reforms around SEND that extended the rights of pupils to have EHC plans from 0-25 years. Southampton traditionally sat below the national average for those children statements. At that time Southampton had 790 statements of SEN and today it has approximately 1,800 statements. This is a significant increase in the number of children with an EHC plan therefore, there is an increase on spend per head that follows the child into mainstream schools and equally there is a demand on special schools due to the complexity of needs.

From a cost avoidance perspective SCC has spent time, money and effort investing in additional places in the special schools to prevent the cost of the independent placements outside the city.

The working group went thought various issues and the figures were demonstrated. They looked at the current spend on High Needs comparatively to the neighbouring local authorities. TM advised that the figure in Southampton is not as shocking as it is for those other local authorities. Southampton Local Authority are keeping the number of children placed outside the city low although they recognise that they can do more to decrease this. The group spoke in detail regarding the historical issues that led to the pressure in that budget, this was illustrated in the circulated PowerPoint.

TM contextualised the screen shared PowerPoint and noted that the number of complexity of SEND is increasing in the city. In 2016/17 the NFF put a cap on High Needs and that in turn has put financial pressure on the High Needs budget and the deficit for 2020/2021 is 9.3M, this had a detrimental impact on SCC finances. The DFE recognised the High Needs pressure nationally and provided funding increases over a 3 year period to LA’s to get the High Needs budget to an in year balance position with a view that LA’s would resolve this. Measurements are in place to manage the need to support the deficit plan. It was identified in the meeting that the top up rates for special schools were out of line and needed rebasing. The Polygon School and Great Oakes School are not in line with their feeder schools.

The recommendations were to discuss the findings in this meeting and for Schools Forum to vote to agree to make a transfer of 0.5% from the schools block to the High Needs block for 2021/22 to support the deficit recovery plan at the meeting in January. The second area agreed in principle was a 5% increase in the overall special school budget in light of the new funding formulas brought in last year; the special schools received theirs through the LA unlike the mainstream schools who received theirs though the MFG or NFF and this led to a further inequity. SCC propose to use the money to bridge the gap between some of the banding that schools receive. For instance, one secondary school has dire financial pressure would be able to attract funding more in line with their feeder school.

Slide 5 illustrated the increasing pupil numbers of complexity in Southampton from approximately 600 EHCP’s in 2010 and in 2020 it is closer to 1,800 EHCP’s.  As time goes on there is an increase at the top end due to the extension of the legislation.

Slide 6 The graph demonstrated that although Southampton has seen a significant increase it is still lower than other LA’s for the rates per 10K. There is an assumption made that Southampton LA are generating too many EHCP’s although compared to other LA’s Southampton are low, this suggests that Southampton expects to see the pressures continue to rise.

Slide 7 illustrated the high needs per capital compared to similar areas nationally, the graph shows Southampton as one of the lower cost cities and that they can expect to see the surge continue.

Slide 8 showed the forecast numbers and it is clear that the challenge of EHCP’s will remain. 2010 to 2019 showed the year on year increase, the plateau is not expected to be reached for a while. If this progresses on the same trajectory in 2020 the pressures will continue. Although the government have given Southampton money for 2020, 2021, and 2022 this it does not help with the financial pressures experienced from 2014 to 2019 and the continuing pressures from 2020 to 2024 onwards. 

Slide 9 show the predicted number in mainstream schools and specialist settings.

MM asked the basis of the assumption regarding the growth in the next 10 years and acknowledge that Southampton is now identifying need better. TM advised that the calculation was done 3 years ago and so far it has reflected the predictions. This year there has been a prediction for the special school places required for 2021 and it is in line with the predictions based on the historical growth. Schools are reporting that there is an increased complexity of need within children entering school. The children are being looked at in detail in the early years and this identified the increasing complexity of need and the support they require is continuing.

PH sought clarity on the graph showing the per capital rate compared to similar areas nationally and questioned if that was due to Southampton having a low number of EHCP’s in special schools opposed to mainstream schools and asked how this compared to other areas, did the per capita rate represent the higher and lower percentages in special schools. TM noted it was broadly in line although Southampton would soon be above the national average and neighbouring rates for percentages in special schools and with more in special schools per capital they would be expected it to be higher.

PH advised that the schools receive £10.98 for staff to support these children and this has not changed for a number of years and it excludes holidays. It was noted that this amount was lower than for grade 6 teaching assistant. TM acknowledged that the figure has stayed static and thought that Southampton were one of the more generous LA’s and advised that she would check this against other LA’s. TM was aware that Hampshire receive £9 per hour although she was unaware if they paid holidays.

ACTION: PC to benchmark the £10.98 per hour payment for staff supporting SEN pupils against other LA’s.

JD noted that this would be useful to have that information for January’s meeting to inform the decision and reminded the forum that today’s meeting was focusing on informing the consultation.

Slides 9/10 NP explained the cause of the deficit and advised that the capping of the NFF in 2016/2017 onwards has contributed to the financial pressure. Every budget provided to the LA from the DFE has been capped, it therefore had not met the needs nationally. LA’s are seeing an increase in demand both in the number of EHCP and the complexity of the EHCP and this is causing huge financial strain. It had been capped to a low percentage increase and has made a huge contribution to the deficit issue.

TM noted that the Children’s and Families Act 2014 extended statutory protection from 5-16 years to 0-25 years with no additional funding. The number of EHCP’s has increased at a rate of 12% since 2015 and the projections show that this will continue. There is an increased right of parents and in law there are only three reasons SCC can reject a preference; not to the age aptitude or ability of the child, the special school states that the child does not have the right level of need for the school or whether it is incompatible with the efficient use of the public purse or the education of others.

ACTION: TM to send out Consolation on Proposal for 0.5% transfer from the schools block to the high needs block 2021/2021 to head teachers. Action Complete.

NP reported that Southampton have received a 17% increase for 2020/2021 with further increases in the next two financial years at approximately 12%. Southampton have a focused activity on reducing the number of pupils with high needs independent specialist placements. However, there is a need to expand the special school placements, this is challenging due to a lack of physical space available. This has led to a significant project and TM will present proposals in the New Year to go to consultation around the expansion and reconfiguration of the local specialist education provision. That will increase numbers of the pupil’s placed within the city. The request for capital funding is significant in cost and scale although this will not be an easy decision giving the position of the LA current budget and the impact of Covid-19. They are also looking at increasing the capacity and capability of mainstream schools and have had a big drive on inclusion in the mainstream schools ensuring the offer is consistent across the board. The inclusion charter and supporting documents will be launched in the Spring/Summer term and will enable schools to self-assess to make changes to their provision to meet the needs of the continually complex children.

Considering the proposed recommendations TM sought advice from Schools Forum regarding how to spit the two items for consultation

1.  around the 0.5% transfer from the schools block funding to the High Needs block.

2.  the issue around the additional 5% uplift funding provided by the DFE for the secondary special schools.

It was thought that for clarity both issues were dealt with separately. 

JD acknowledged SP’s comments around the two recommendations and asked the forum for their thoughts around the proposal and how it would work to balance the budget before moving to the technical decision around if it were to be approved how it would be funded. JD noted that the decision need to be agreed or not in January.

RW asked if the projection for the budget 2021/2022 included a pay rise. NP advised that the salary costs are quite small as a percentage of the budget and would not necessarily make a material difference, he did not have the figures to hand. RW noted that people were on a range of pay scales and it would be good to know the amount. NP advised that they are building in incremental growth that has not been frozen. JD noted the value of having this extraordinary meeting to get a full answer to that question in January when the decision will be made.

SP extended his thanks to the LA for to all the hard work the stakeholders have done regrading providing information and being open and transparent and to congratulate the LA on the work done around sufficiency and cost avoidance. The massive amount of work that has been done is now starting to have an impact and will continue to have an impact in the future. SP acknowledged that this was a difficult conversation to have and there are difficult decisions ahead. JD concurred with SP’s comments and followed by saying that informed decisions are always the best form and the quality of the papers and information provided and the spirit of transparency has been hugely welcomed, thanks to the officers concerned for pulling it together.

JD summarised the issues. In January the question is should Schools Forum agree a 0.5% transfer from the schools block to the high needs block and TM presented the issues around that. The second issue is that if Schools Forum do agree to that then how should it be funded.

NP screen shared a spreadsheet and expanded on the three options on how the ½% transfer from the schools block to the high needs block would be achieved. Funding from April 2021 to March 2022 NP is using the DFE indicative figures based on the census data from 2019 as SCC have not yet received the data for 2020. The APT model used is provided by the DFE, this is a prescriptive model with embedded formula although the LA can have discretion to change things this year, when SCC moves to the hard NFF where the funding is set centrally and changes cannot be made. The budgets have been calculated for both last year and this year using the full NFF rates with an aim to have a smooth transition to the hard NFF rates when they come in.

The LA has set an MFG for next year’s funding to between a ½ and 2%, the minimum funding guarantee (MGF) means schools are guaranteed to get in increase in funding of that percentage over and above the eligible criteria year on year. This changes each year. The average weighted pupil unit (AWPU) is a calculation for the value for each child that is tied up with the minimum pupil funding level that guarantees that each child gets a certain amount across the country. AWPU is a per pupil amount and MFG is an overall amount for the school.

Option 1: the ½% could be achieved by setting the MFG at 0.78% and leaving other factors at the NFF rate. This option would effect 73% of the schools; 49 schools with an average adjustment per school of £15,427 reduction. Although there is an average of 15% where some schools are affected a lot more and others a lot less, the table shows the effect on different schools.

Option 2: By reducing the AWPU to 99% of the NFF factor; the MFG would increase up to 1.1%. The benefit was that more schools are contributing to the ½% and that brings down the average adjustment per schools to £13,033.

Option 3: Similar to Option 2, this model was not flexible. However, if the MFG was set at 1.13%, the AWPU was kept at 0.99% and reduced the lump sum per school down to 90%, this gave the same result as Option 2 although the distribution was different.

JR queried the baseline used, NP explained the baseline was the figure provided by the DFE for next year although it uses October 2019 census data. The final allocation for next year is not in yet and the options are worked out on indicative numbers. The new baseline data is expected shortly.

PH queried the effect of schools that do and do not contribute by changing the baseline and raised concerns around the schools with the lowest pupil premium appeared not to be contributing in all options with the schools with higher pupil premium seem to be contributing the most and they are the most in need of the funding. NP acknowledged the query and advised that the model is very robust and the formula was set by the DFE and cannot be changed.  JD advised that the NFF is about levelling up so the MFG per pupil goes up in schools with low characters of children who attract extra funding such as SEN and EAL issues.

SP agreed with PH’s and noted that the schools with low need would not contribute anything and the schools with high need would contribute a higher amount to support that. Although the minimum per pupil funding formula was set by the DFE, disapplication requests that can be put through although they are likely to not be accepted. This is an issue as when looking at a transfer and if it is agreed SP thought from a personal point that every school should contribute as it would seem unfair that the schools with the most need and schools most likely to have many SEN pupils were contributing to a SEN problem. This needed to be considered when making the decision for the ½% transfer. JD agreed that the decision needed to be fair and to consider the impact that will have on schools who are most in need.

When asked about schools with reserves NP noted that they are becoming rarer and rarer. They were only allowed to commit a small amount of reserves without a plan explaining how the reserve will be used. JD suggested that the information was provided in the January meeting, NP confirmed that it would be indicative using last year’s numbers. DW added that there is a protocol that was agreed at Schools Forum about schools in surplus and schools in deficit that was produced by a working party about 18 months ago and approved by the forum. SP added that schools cannot be selected through the formula. 

ACTION: NP to provide information around schools with reserves in the January meeting.

JD invited any further question for NP or TM about the consultation. No additional questions were asked.

JD thanked NP and TM for the quality of papers presented this evening.