MPs Say Unaffordable SEN System is Driving Councils Towards Bankruptcy

January 16, 2025 TruthUSA

MPs have highlighted the urgent need for reform in the special education needs system, expressing concern that without changes, a generation of children could be left without the necessary support upon leaving school.

The Public Accounts Committee (PAC) has urged the government to address the “unaffordable” special education needs (SEN) system, which is failing children and placing nearly half of councils at risk of financial collapse.

PAC, whose role is to assess the value for money of government spending, stated in a report released on Wednesday that the SEN system has become unsustainable for local authorities.

The report reveals that councils are facing deficits totaling £4.6 billion by March 2026, jeopardizing their financial stability and potentially pushing almost half of English local authorities towards bankruptcy.

Sir Geoffrey Clifton-Brown MP, chairman of the committee, expressed, “Urgent warnings have been raised with the Government about the failing SEN system from various sources. This is an ongoing emergency that needs immediate attention. Families in need of assistance have had to fight tirelessly for the support they are legally entitled to, while local authorities bear an unsustainable financial burden.”

Growing Deficits

Since 2015, there has been a 140 percent surge in the number of children with education, health, and care (EHC) plans, which outline a legally enforceable entitlement to specific SEN assistance.

Most local authorities have consistently exceeded their annual high-needs budget since 2016/17, resulting in escalating cumulative deficits. Some local authorities have even had to delve into their reserves to cover SEN expenses.

Since 2020, councils have had the option to exclude these deficits from their primary revenue budget, avoiding repercussions on their overall financial standing. However, this practice only masks their deteriorating financial health.

PAC warns that this exclusion arrangement will expire in March 2026, placing 66 local authorities (43 percent) at risk of breaching their statutory obligations to balance budgets, “effectively leading to bankruptcy.”

These concerns arise as councils face mounting financial strains, potentially endangering essential community services.

In October, the County Councils Network (CCN) highlighted that without additional funding from the government or a significant reevaluation of councils’ statutory responsibilities, local authorities might be reduced to mere care service providers, compelled to sacrifice other essential services.

The CCN attributed rising costs to heightened demand in children’s services, adult social care, and EHC plan-mandated transportation for SEN children.

‘Postcode Lottery’

The PAC report points out stagnant outcomes for children with special needs and a diminishing confidence among parents in the system.

It notes extended waiting periods for assessments and support, with only half of EHC plans being issued within the mandated 20-week timeframe.

The report also highlights disparities in support provision based on geographic location or families’ ability to navigate through a complex and adversarial system.

The committee observed a rise in tribunal cases contesting councils’ adverse decisions.

Despite only 2.5 percent of local authority EHC decisions being appealed in 2023, tribunals ruled in favor of parents in 98 percent of cases.

Clifton-Brown emphasized that the high success rate for families in these cases signals unnecessary bureaucratic hurdles in the system.

Improving Mainstream Provision

The PAC recommends that the Department for Education (DfE) outline the future of the special education needs sector within the next six months, focusing on enhancing the integration of SEN children in mainstream schools.

The authors of the report issued a stern warning, stating, “Without immediate action, the [DfE] risks leaving a generation of children without the essential support they require upon leaving school.”

Children eating their lunch in the canteen at Royal High School Bath in Bath, England, on Nov. 29, 2023. (PA) — Children eating their lunch in the canteen at Royal High School Bath in Bath, England, on Nov. 29, 2023. PA

Councillor Arooj Shah, chair of the Local Government Association’s Children and Young People Board, supported the PAC’s characterization of the “failing” SEN system as a crisis, noting that the report reflects councils’ persistent concerns regarding the need for more inclusive provision and the substantial financial pressures on councils to be adequately addressed.

Shah stressed the urgency for the government to overhaul SEN provision to better assist children and families, ensuring that councils are financially stable with high-needs deficits forgiven.

Failure to do so might push many councils to a fiscal precipice, compelling them to reduce other services to balance budgets, unrelated to their actions or residents, she warned.

Responding to the report, schools minister Catherine McKinnell acknowledged that the government has injected £1 billion into SEN and £740 million for councils to expand places in mainstream schools for children with special needs.

McKinnell commented, “These challenges are deeply entrenched and will require time to rectify, but we are steadfast in our commitment to delivering the necessary changes sought by exhausted families through better early intervention and inclusion.”

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