To review the Dedicated Schools Grant high needs budget for 2019/20 and recommend to the cabinet member children and families any necessary adjustments in the Pupil Referral Service charges to schools and SEN support services to schools.

The strategic finance manager (SFM) gave an overview of the report and highlighted the following key points:

·        The main focus of changes to the high needs budget for 2019/20 involved the pupil referral service;

·        Over the following two years it was proposed the pupil referral unit (PRU) transition to providing 50 places for permanently excluded pupils, funded by the council, and 30 discretionary places to be purchased as required by schools;

·        The changes would lead to savings to be delivered on a phased basis over the three year period;

·        There would be an increase in the PRU top up fee to £6,700 for all students from September 2019;

·        Further work was needed on the detail of arrangements for the PRU and the packages that would be available for schools to purchase, this was ongoing with Herefordshire Association of Secondary Headteachers (HASH);

·        It was proposed that an intervention fund be established from September 2019 to support schools with meeting the needs of students, the operation of this fund would be subject to consultation with HASH and would support the in year fair access panel;

·        A collection of changes were also proposed to SEN support services to achieve savings of £110k in 2019/20 and further savings in future years, the budget working group had asked for further detail on these savings which was now included in the report at paragraph 14;

·        Allowance had been made in the proposed budget for growth in numbers of  post 16 pupils, out of county independent special school placements and in county special school places;

·        Projections for the next three years showed that the high needs budget was expected to remain in surplus until 2021/22 but this would require support from schools to continue to transfer surplus funds from the schools block;

·        longer term changes to high needs funding could arise from the government’s comprehensive spending review and any future changes in DfE policy;

·        proposals for work on early intervention would be taken to the budget working group in May 2019, with a report back to the forum in due course, the proposals would consider how to invest to prevent further cost pressures arising while maintaining statutory services;

·        analysis of secondary rolls suggested that it might be appropriate to establish a SEN protection scheme for secondary schools similar to that in place for primary schools, this would cost approximately £60k per annum which would need to be funded, there were at present one or two secondary schools with higher than average numbers of SEN pupils;

·        the high needs budget proposals would go forward to the cabinet member children and families for a decision, any comments from the forum would be included in the report.

The PRU representative on the forum commented on the proposals for changing the service. She thanked the SFM for the time spent on preparing for the change. A working party had been established, including representatives from secondary schools, to oversee the changes and work towards a viable model.  The PRU had seen increasing numbers year on year and a real need for the service. This increase reflected the national picture. Funding pressures on all sides were noted, both schools and the local authority had seen income squeezed and the packages offered by the PRU would have to be affordable. Work would continue in the run up to September 2019 to reach agreement with HASH on how the service would operate. The savings required for the first year were felt to be achievable and work was in hand to address the second year of savings. An update could be provided to the forum at an appropriate future point.

In discussion of the report it was noted that:

·        a total of £400k savings was expected to be realised from the changes over 2 years, with £200k reinvested into the intervention fund;

·        central services would contribute £110k savings in 2019/20;

·        the total number of places at the PRU would remain the same, the split of funding would change;

·        the PRU had been brought back into the local authority as a maintained school, the management committee had been reinvigorated and would operate similar to a governing body, the change did not have any impact on the financial issues faced;

·        condition surveys were being carried out on all SEND premises and were expected to be completed soon, while Herefordshire did not generally benefit from growth funds, a capital investment strategy would be created based on the information from the survey so that funding which did become available could be targeted to priority schemes.

The chair of the budget working group stated that the proposals had been discussed extensively at the working group meeting of 1 March 2019. The working group recognised the risks of taking from one funding pot to meet needs in another and supported looking at intervention strategies to prevent further increases in demand.

Secondary headteacher representatives commented that the views of secondary schools were likely to differ depending on the level of need for pupil referral services in each school and the approach each school took to supporting pupils. Travel costs were also an issue, particularly for schools further away from Hereford.

It was resolved that:

having regard to the views of the Budget Working Group, the high needs budget plan be approved for recommendation to the cabinet member for children and families as follows:

a)     the Pupil Referral Unit be funded as set out below

(i)               80 places for the period April 2019 to August 2019 comprising 50 places for permanently excluded pupils and 30 discretionary managed move/ intervention places

(ii)             50 places for new and existing permanently excluded pupils for the period September 2019 to March 2020 and thereafter 50 places annually

(iii)           15 places for discretionary managed move/intervention for existing pupils for the period September 2019 to August 2020

(iv)           15 discretionary intervention places for new pupils to be charged at cost to the school purchasing the place until August 2020 and thereafter 30 discretionary places annually to be charged at cost to the school purchasing the place

(v)             savings on a phased basis of £30,000 in 2019/20, a further £100,000 in 2020/21 and a final £70,000 in 2021/22 be approved

(vi)           An intervention fund be approved on a phased basis of £50,000 from September 2019 in 2019/20, £125,000 in 2020/21 and £175,000 in 2021/22 for use by the Inyear fair access panel, or similar, to support schools with meeting the needs of students following consultation with the Herefordshire Association of Secondary Headteachers (HASH)

(vii)         An increase of £1,000 in the PRU top-up fee to £6,700 for all students from September 2019

b)     budget efficiencies and increased charges to schools in the SEN support services to a total of £110,000 be approved from April 2019, a further budget efficiency of £40,000 from April 2020 and a final budget efficiency of £50,000 in April 2021;

c)     an income budget of £100,000 be set for the high needs contingency in expectation of an equivalent saving in Complex Need Funding for 2019/20; and

d)     the high needs budget including the amendments as above be approved as set out in Appendix 1.