To approve school forum’s recommended budget proposals for school budgets, central school services and early years within the Dedicated Schools Grant (DSG) for 2025/26.

 

The Senior Finance Business Partner (SFBP) presented the report and outlined the proposed schools budget based on the confirmed Dedicated Schools Grant allocation from the Department for Education (DfE). A copy of the slides used in the presentation are attached to the minutes of the meeting. The principal points included:

 

·       The authority proforma tool (APT) & final allocations for the school’s block, High Needs Block, and Central block had been published on 18^th December 2024.

·       The Dedicated Schools Grant funding for the school’s block in 2025/26 is £138.2m which is an increase of 2.36% per pupil.

·       The October Census showed a decrease in pupil numbers for primary and secondary schools which tightens funding and adds to the compromises required to fund the schools to high needs block transfer.

 

25/26 Schools Block

·       Funding through mainstream schools national funding formula (NFF) is increasing by 2.36% per pupil in 2025-26. However, it was noted that in 2025/26, 1.28% of the 2.36% increase is for the core schools budget grant (CSBG) uplift which ensures that the 2024 teachers and support staff pay awards continue to be fully funded at national level in 2025 to 2026. Growth excluding CSBG uplift therefore is only 1.08% meaning compromises would have to be made in the schools’ block in 25/26 this year to fund the schools to high needs block transfer.

·       The drop in pupil numbers year on year also adds to the compromises required to fund the schools to high needs block transfer.

·       A minimum funding guarantee of 0% year on year has been applied, the maximum from the range -0.5%-0% given by the DfE for 2025-26.

·       The maximum allowed school block transfer process to fund the SEN Protection Scheme of 0.5% was proposed.

 

SEN Protection scheme

·       The scheme had been hugely supported by schools in the past and without it would have a significant impact on the most inclusive schools.

·       Without the scheme the impact on the most inclusive schools will be significant.

 

Dedelegations & Education function costs

·       It was proposed a 2.36% increase (year on year funding/pupil increase) to existing de-delegation items and Education Function costs were applied.

 

25/26 Central Block

·       The central block is increasing year on year by 0.8%:

·       For 2025/26, the central block is increasing from £851,810 (2024-25 rebasing for additional grant: £926,185) to £933,855 in 2025-26.

·       The SFBP took the forum though how the funding would be distributed, with the main change year on year being the increase in the allocation to the high needs block to aid with the high needs block deficit.

 

25/26 High Needs Block

·       The High Needs Block funding for 2025/26 is increasing to £28.9m, a year-on-year increase of 7.6%.

·       As of 31^st March 2024, the cumulative high needs budget deficit for Herefordshire Council was £6.1m. During 2024/25 the High needs budget had been monitored by close collaboration between service and finance departments in the Council, and as at Quarter 2 the full year deficit is forecast to be £7.6m which would bring forward a cumulative deficit of £13.7m as of 31^st March 2025. The pressures in the current forecast are driven by independent school placements due to a shortage of Local Authority special school places.

 

25/26 EY Block

·       The minimum pass-through requirement for local authorities in 2025/26 had increased from 95% to 96%. It’s anticipated that in subsequent years this could increase even further to 97%.

·       For 2 year old (2YO) (working parent entitlement) and Under 2YO, the national funding formula PTE number had been adjusted to take into consideration the 30 hours extension from September 25.

·       There is an expectation that local authorities will announce their funding rates to childcare providers by 28 February 2025 and this will become a requirement for 2026/27.

 

In response to member’s questions, it was noted:

 

·       The Head of Learning and Achievement confirmed that there were no pressures currently in the county in terms of early year provision but projections going forward showed there were some small pressures in terms of areas/ locations rather than numbers which the team would be working on. The SFBP highlighted that spend is monitored monthly and If any underspending occurred or anything that could be done to push extra funding towards the high needs block, it would be brought to the schools forum.

 

The forum expressed they’re thanks to the SFBP for delivering a clear and informative presentation and thanked the teams for all their hard work. They were especially impressed with the process and engagement delivered.

 

The Chair of the Budget Working Group thanked the SFBP for her work on the proposals. He highlighted the key points discussed during the working group meeting specifically the strong support on the matter of the transfer to the high needs block to protect the SEN Protection Scheme.

 

The Service Director, Education, Skills and Learning gave her full support and thanked colleagues for their hard work in delivering the budget. Her comments were echoed by the Director of Finance.

 

 

It was resolved that:

 

1. Herefordshire’s school funding proposals for 2025/26 to adopt the national funding formula values be recommended to the Cabinet Member for Children and Young People as listed below:

 

a)    subject to a gains cap of 2.00% to ensure affordability, the statutory minimum total funding per pupil for primary and secondary schools, and including the Minimum Funding Guarantee at 0.0% (maximum allowed for 2025/26)

b)    NFF values used for 2025/26 (in bold) are as follows (with TPAG, TPECG and CBGG rolled into the second column):

 

	2024 to 2025 NFF values	Additions to baselines from grants	CSBG uplift (full year cost of the 2024 teachers’ pay award)	2025 to 2026 NFF values
Basic per pupil funding
Basic entitlement
Primary basic entitlement	£3,562	£213	£51	£3,847 at 100% (£3,791 at 98.5% Option C)
Key stage 3 basic entitlement	£5,022	£300	£71	£5,422 at 100% (£5,342 at 98.5% Option C)
Key stage 4 basic entitlement	£5,661	£339	£80	£6,113 at 100% (£6,023 at 98.5% Option C)
Additional needs funding	2024 to 2025 NFF values	Additions to baselines from grants	CSBG uplift (full year cost of the 2024 teachers’ pay award)	2025 to 2026 NFF values
Deprivation
Primary free school meals (FSM)	£490	£0	£0	£495
Secondary FSM	£490	£0	£0	£495
Primary free school meals Ever 6 (FSM6)	£820	£188	£45	£1,060
Secondary FSM6	£1,200	£277	£68	£1,555
Primary income deprivation affecting children index (IDACI) A	£680	£0	£0	£685
Primary IDACI B	£515	£0	£0	£520
Primary IDACI C	£485	£0	£0	£490
Primary IDACI D	£445	£0	£0	£445
Primary IDACI E	£285	£0	£0	£285
	2024 to 2025 NFF values	Additions to baselines from grants	CSBG uplift (full year cost of the 2024 teachers’ pay award)	2025 to 2026 NFF values
Primary IDACI F	£235	£0	£0	£235
Secondary IDACI A	£945	£0	£0	£950
Secondary IDACI B	£740	£0	£0	£745
Secondary IDACI C	£690	£0	£0	£695
Secondary IDACI D	£630	£0	£0	£635
Secondary IDACI E	£450	£0	£0	£450
Secondary IDACI F	£340	£0	£0	£340
Low prior attainment (LPA)
Primary LPA	£1,170	£0	£0	£1,175
Secondary LPA	£1,775	£0	£0	£1,785
	2024 to 2025 NFF values	Additions to baselines from grants	CSBG uplift (full year cost of the 2024 teachers’ pay award)	2025 to 2026 NFF values
English as an additional language (EAL
Primary EAL	£590	£0	£0	£595
Secondary EAL	£1,585	£0	£0	£1,595
Mobility
Primary mobility	£960	£0	£0	£965
Secondary mobility	£1,380	£0	£0	£1,385
School-led Funding
Lump sum
Primary & Secondary lump sum	£134,400	£8,006	£1,915	£145,100
Sparsity
	2024 to 2025 NFF values	Additions to baselines from grants	CSBG uplift (full year cost of the 2024 teachers’ pay award)	2025 to 2026 NFF values
Primary sparsity (average year groups size of 21.4)	£57,100	£0	£0	£57,400
Secondary sparsity (average year group size of 120 pupil)	£83,000	£0	£0	£83,400
Premises
Split sites (autism resource base at Hampton Dene Primary School complies with the DfE’s new national split site factor criteria.)	£80,600	£0	£0	£81,000

 

c) Business Rates – funded at estimated cost of £1,305,765.38

d) The council will continue to participate in the DfE’s scheme for business rates payments to be paid centrally by the DfE in Whitehall.

e) Exceptional premises factor – an additional allowance for the lease of additional space to £17,000 to meet rent costs for Eastnor Primary School subject to DfE approval. A disapplication approval is required from the ESFA for this item following approval by schools forum.

f) PFI factor – increased to £363,156.82 to comply with PFI contract which uses the RPI(X) at 2.3% (annual increase specified by the DfE)

 

(Voting on this item was restricted to local authority schools, academies and early year’s members only)

 

2. Additional growth funding of 30 KS3 (yr7) pupils at Aylestone School (Sep25 onwards). Growth has been represented as implicit growth and hence included as part of the funding formula in line with all other pupils in the Oct24 census. (Explicit growth = outside of the funding formula). This is in line with clarification from the ESFA on how to treat this pupil growth. The growth has been recommended and approved by the Council services.

 

3. Transfer to high needs block to support the SEN protection scheme, £690,827.

 

4. That the Cabinet Member for Children and Young People be advised for information, that Schools Forum approved central support services funding for 2025/26, and advise the Cabinet member for Children and Young People for information, as follows:

(a) Statutory retained duties £390,000

(b) Schools Forum administration costs £20,000

(c) School admission costs £100,000

(d) National licences for schools £157,000

(e) Additional funding for statutory duties for SEN casework team £0 (to be absorbed into Council budgets for 2025/26)

(f) SACRE funding for statutory duties £10,000

(g) Transfer to the high needs block £256,855

 

Any FTEs within these numbers will attract a salary cost + a share of corporate recharges (the cost of running the Council) which are apportioned by the Council across all cost centres by FTE number.

 

5. That, local authority maintained school members, approve an increase of 2.36% in the de-delegation of funding & Education Management Function for 2025/26, and advise the Cabinet member for Children and Young People for information, as follows:

(a) Trade union facilities for primary schools only be approved at £2.76 per pupil (2024/25 £2.70)

(b) Trade union facilities for secondary schools only be provided for through a Service Level Agreement at £2.76 per pupil

(c) School budgeting software licence at £441 per school (2024/25 £431/school)

(d) Ethnic minority support at £1.22 per pupil plus £7.23 per Ever-6 Free school meals and £37.55 per English as an Additional Language three years (EAL3) (2024/25 £1.19, £7.06 and £37.19 respectively)

(e) School meals entitlement assessment at £1.36 per primary pupil and £1.03 per secondary pupil (for local authority schools) (2024/25 £1.33 & £1.01 respectively)

(f) Behaviour support service at £4.25 per primary pupil (2024/25 £4.15)

(g) School improvement services at £6.25 per pupil (2024/25 £6.11)

(h) Contingencies at £1.04 per pupil (2024/25 £1.02)

(i) The statutory education services for non-academy schools be charged at £13.04 per pupil (2024/25 £12.74)

 

(Voting on this item was restricted to Local authority primary and secondary school members only)

 

6. The early years funding formula for Herefordshire providers from April 2025 be increased as follows:

(a) Two year olds – Families Receiving Additional Support: £7.47/hr (£7.34/hr 2024/25)

(b) Two year olds – working families: £6.98/hr (£6.85/hr 2024/25)

(c) Under two year olds - £9.71/hr (£9.51/hr 2024/25)

(d) Three and four year olds: £5.47/hr with rurality now built into rate (£5/hr 2024/25)

(e) Central retention at 2.7% (in line with 2024/25)

(f) SEN inclusion fund (SENIF) £150,000 (in line with 2024/25) – to be funded across all rates and paid back out to providers based on SEN number.

(g) Deprivation funding taken from all rates, and then paid back out to providers based on EYPP number. (Under 2s £0.76/EYPP pupil, 2 year old £0.53/EYPP pupil, 3&4 year old £0.44/EYPP pupil, in line with DfE 2025/26 Early Years output tables)

 

(Voting on this item was restricted to local authority schools, academies and early year’s members only, Items a-d)