Good news for the schools budget and education

How a Conservative Council can get what Kingston needs

Since 2013/14 there has been a growing deficit on the education budget in Kingston. To understand what this means requires an understanding of how the schools budget works which I have tried to simplify below. We inherited this position and very quickly we were in contact with Government Ministers to try and understand what could be done. Putting aside General elections and changes of Secretary of State we have been applying constant pressure to the Government to help understand what the issues are.

This lobbying culminated in a meeting I held with the Secretary of State for Education and the Secretary of State for Local Government together just prior to Christmas having had earlier meetings with Ministers.

A couple of weeks ago I met, with Zac Goldsmith MP and the new Secretary of State and continued the discussions.

Last week I had a meeting with Schools Minister Nick Gibb MP and I am delighted that we now have the Governments support to help Kingston council and their schools get a period of transition. It will require us all to work to change the education system in Kingston but we now have money and will to deliver what is required. It also means we no longer need to implement much of the “disapplications” to move money out of schools to help solve the education budget problems and the DfE will be advancing a further £3m to help Kingston schools and the council find the space to put together a solution. That said, the schools are part of the solution to the problems we are seeing and need to participate with us in finding a solution.

We are pleased we have been able to work with the Government to deliver this significant concession after the efforts we have made to make Kingston's case. There is real power in lobbying when you do it in a constructive and positive way.

Below is a deeper explanation of the issue.

School budgets

The local authority receives directly from Government the Dedicated Schools Grant (DSG) and the local authority “passports” this onto the local education providers; schools, early years and the part of the local authority responsible for Special Education Needs (SEN) and the new Education and Health Care Plans (EHCP).

Kingston Council “passports” this DSG from Government to the schools in full and no money is top-sliced or held back.

Once it is ‘passported’ the money is divided into three blocks; the school's block, the early year's block, and the high needs block. Schools Forum (SF) meets and discusses how those blocks are funded. It is this group that meets to set the wider priorities for the Borough and also establishes how it spends the money Government allocates across the whole Kingston education system. The SF is formed from representatives of the various schools and other education providers.

The forum decides:

1. how much funding may be retained by the local authority within the dedicated school's grant (for example, providing an admissions service, or providing additional funding for growing schools)

2. any proposed carry forward of deficits on central spend from one year to the next

3. proposals to de-delegate funding from maintained primary and secondary schools (for example, for staff supply cover, insurance, behaviour support)

4. changes to the scheme of financial management

The problem

The DSG is overspending. This is not the fault of the council or the schools directly as it is a collective local education issue that needs to be resolved by the schools and the Council together. Schools also have a responsibility to the wider system to make the education service across the Borough sustainable. It is the high needs block (Special education needs and disability) that is overspending as we see rising demand in the system. As well as funding special school places the schools too are funded from the high needs block through both a basic allocation and top-ups when they take SEND pupils into their schools.

This overspend has been an issue since 2013/14 when we started spending more money than the DSG allocated, mainly because of the growing numbers, severity and cost of Special Education Needs and disability. These are our most vulnerable children so we cannot simply turn off the funding tap. The difficulty is that the overspend has escalated and widened. However, the Schools Forum has been unable to agree how they handle the issue and have refused to support various propositions that have been put to them. At our recent budget council meeting, the DSG was passported in the normal way and no political party raised a concern in doing this.

By the end of this year, the DSG will be in deficit by £12m which is greater than the general reserves of the council. The projected overspend for next year alone is now estimated at £8m and we need to find those savings. Some of this is to do with the issue of us having growing numbers of children needing expensive out of borough placements in the private sector but it is also to do with how much money we are committing to SEND provision within mainstream schools.

A deficit on the DSG cannot continue because at some point it will be necessary for schools to face substantial contributions to clearing the deficit as the DSG overspend stays within the DSG.

Achieving for Children (AfC), who work with the schools and placements for SEND, have committed to finding £4m from within the existing provision of the high needs block. Because the council does not have the power to move money out of other blocks into the high needs block it had requested permission to do so from the Secretary of State; this is called ‘disapplication’. We had applied for £4m of disapplications but we have been told at a Ministerial meeting this week that they will only allow £1.3m of those disapplications by moving money from one block to another. This allows the schools to play their part in solving the problem but also means that many schools will still see a rise in their allocation of money this year. The DfE will also be advancing a further £3m to Kingston to help our schools and the council find the space to put together a long-term resolution to this issue.

What has been made clear to us is that Government does not believe there is an extra funding case for Kingston as they have just gone through a consultation on a new funding formula. We need to find a way to make our education system work in Kingston within the envelope of money provided within the DSG.

What did we do about this?

We have lobbied hard on this for the past two years. Whilst Kingston is an outlier in England for the scale of the problem the DfE recognises we could also be a trailblazer for a wider problem. As I have said, as Leader of the Council, I have met with the Secretary of State on two occasions and also discussed it with the Secretary of State at the communities department.

We now have an agreement with the Government which will support the work we need to do to work out how we make the education system in Kingston function within the budget we are given. The Government will be keeping a close watch on what we do and that is to be welcome.

We are also establishing a high-level Education Commission for Kingston to examine the future of education in the Borough and how we can transition to a more sustainable model. It will be chaired by someone independent and with an understanding of education, possibly a former Secretary of State or senior DfE advisor. Schools, parents and the wider community will need to engage in this process. Its task will be to design an education system for Kingston that works within the envelope of money we receive. This will be challenging, but I am hopeful it will draw the schools closer together as we explore new models of working for Kington.