Agenda item

2019/20 Schools Budget - Report and 3 appendices attached


Jenny Lawrence presented a paper on the 2019/20 Dedicated Schools Grant Settlement for Leicestershire and the 2019/20 Schools Budget.  The report builds upon a number of reports presented through the 2018/19 financial year.


Jenny explained the background to the funding system in terms of how it is received into the local authority and the role of the Schools Forum in setting the 2019/20 Schools’ budget.


Jenny referred to paragraph 17 which sets out the purpose and scope of the 2019/20 Schools’ Budget and the action required. 


Jenny referred to the Dedicated Schools Grant (paragraph 20) section in the paper which sets out the funding settlement for 2019/20.  The provisional overall DSG is £500m which is broken down into four separate blocks, the use of which Jenny outlined to the meeting.


In terms of the high needs block there was an announcement in December that gave Leicestershire £1.4m each year for 2018/19 and 2019/20 but was unsure whether this will continue, the High Needs Development Plan accounts for this funding on an on-going basis.  This would ease some of the high needs pressure but confirmation of this funding was still awaited.  The Early Years final grant will not be confirmed until June 2020.


Jenny stated that in terms of the Schools’ Block a ‘soft’ funding formula has been confirmed for 2020/21 i.e. local authorities retain responsibility for setting a school funding formula but there is no further information on school funding.  The Leicestershire funding formula continues to reflect the National Funding formula (NFF) with the exception of sparsity funding.  2019/20 is the second year of the NFF and schools will receive a minimum per pupil increase in funding of 0.5% on the floor (a total of 1% compared to the 2017/18 baseline).  Jenny stated that the formula has been submitted to the ESFA who have queried one element of the submission.  Until this is resolved school budgets cannot be issued.  It was hoped to get the issue sorted around 2017/18 baseline which is used this year but cannot use next.


The current overspend position of SEN placements and it is projected that an overall high needs overspend of £5.2M will be present in 2022/23 after which the deficit is recovered.  The situation is expected to stabilise as new provision comes through the system.  Jenny highlighted the £4.3m protection funding mentioned in paragraph 27 which is not guaranteed and it is uncertain how long that will remain in the funding system.  A submission to the ESFA in December for the places expected to commission from the high needs providers for the following academic year are shown in Appendix C.


Jenny stated that there was no new information on the grants for universal infant free school meals and PE and sports. 


Jenny stated that funding school growth funding for a new school works well but is proving to be a barrier in terms of growing mainstream school capacity which is something that needs to be addressed.


Jenny outlined that for 2019/20 funding for school growth is formulaic based on increases in pupil numbers between 2017 and 2018 October census and the allocation for 2019/20 is £2.3m which is a significant increase from 2018/19.  However the cost of delivering the full NFF in 2019/20 exceeds the school element of the Schools Block by £0.6m.  £0.2m of this relates to a difference in the formula budget and DSG allocation for the new Lubbesthorpe school opening in September 2019.  The growth allocation has fully funded the shortfall resulting in a proposed school growth budget of £1.7m for 2019/20.


The dedicated schools grant reserve is at £1m which is planned to take forward.


Chris Swan referred to paragraph 45 and asked for clarification of the growth funding policy.  Jenny explained how it worked in principle and stated that the local authority had a statutory duty to consult on policies.


David Thomas asked Jenny if she could provide figures for each element of the DSG reserve (est £1m).  Jenny would add this to the minutes (see below).


2018/19 DSG Reserve;





Schools Block - School Growth


Early Years Surplus


High Needs Deficit




DSG Surplus c/f




Jenny stated that the overspend on the high needs block is £2.5m with £2m in reserve.


Graham Bett asked if there was any other county council or authority that have the same policy in that DSG expenditure needed to be contained within the grant available.  Jenny stated that this is the position in most authorities.  Graham asked if a list of local authorities that provide funding in addition to DSG could be provided for the next meeting.  Jenny said that this information could be provided for 2018/19 but not for 2019/20.  Note – the format of the data published by the DFE for 2018/19 does not identify this information.


Nick Goforth stated that there were no surprises in terms of funding for 2019/20 but asked for thoughts on funding from 2019/20.  Jenny stated that 2020/21 will be a soft formula and she expected 2020/21 to continue the 2019/20 funding levels.  Jenny stated what happens to the floors and the ceilings is something that is unknown. 


Nick Goforth asked for thoughts on the Secretary of State’s view that a 2% increase in teacher pay is affordable from school budgets.  Jenny assumed that it will go through but was unsure whether there will be any changes to the pay grant.  Jenny added that unless the pay award increases this will be another pressure on school budgets.  Nick added that LSH had responded to headteachers on this and this may something LPH should do as well.


Jenny informed the meeting that it was necessary to increase capacity to work with schools in terms of financial planning.  The recruitment process for this post had taken place but was unsuccessful.  The post has been advertised again and from applications received it was hopeful an appointment will be made this time around.  Jenny added that when the recruitment process started the immediate focus was maintained schools but discussions through LEEP and factors identified by academies have raised how this resource will be most effective.


Graham Bett raised concern of the lack of money in the school system and the concern that schools are losing high quality staff at a time when the number of children in the system is increasing.  Representatives of this group should join forces to make the Government aware of the Schools Forum concerns and the damage being caused to the school system.  Jenny stated that schools do operate successfully within their budgets but agreed that the issues need to be tabled.     


Nick Goforth stated that the 2020/21 budget will be down to the comprehensive spending review.  Jenny stated that a decision was due autumn 2019 which leaves it late for planning into 2020/21.  There is a suggestion it will be a one-year settlement.  Discussion took place on the 2% increase which will be extremely difficult to find – is there a place for Schools Forum to express its concern.


Nick Goforth stated that from a meeting with the Regional Schools Commissioner schools not in a MAT should be for school efficiency.  Jenny stated that previously the DfE used to convene conferences for Schools Forum but now there is no such mechanism. 


Jenny asked Schools Forum to note the notional SEN budget of £33m outlined in paragraph 50.  This SEN funding is a subset of the funding delegated to all schools and academies and was established to guide schools in the allocation of resources to meet additional needs of pupils.


Jenny outlined the arrangements in paragraph 52 for reclaiming funding from schools excluding pupils permanently.  The rates are also applied to the funding adjustments made in relation to dual registered pupils at Oakfield, the charges levied for the education of children with medical needs and will be recommended to the Secondary Inclusion Partnerships.


Jenny added that the pupil premiums and early year provider funding rates are unchanged.


Jenny stated that the pressures in the local authority budget are clearly visible in paragraph 58; Leicestershire are however in a reasonable position.  Jenny added that a balanced budget has been set for the next 2 years and in terms of Children and Family Service there is growth to increase capacity in the SENA service to address the issues.


There are no new savings, but work continues the process for savings around commissioning of looked after children, internal foster carers and reduction of high cost residential placements.  The Children’s Commissioner has started to work on costs which will feed into the comprehensive spending review.


There was no further update on the Free School Bid.


Suzanne Uprichard asked if the Educational Psychology Service will shrink and less psychologists available due to the savings of £100k.  Jenny understood that the service will be staffed to capacity so the staffing budget will be reduced.


Chris Parkinson raised an issue regarding the implications of the costs in terms of key stage 4 pupils - average cost for the year is £10K which is approximately £55 per day.  The suggestion is that the local authority should match that as a charge.  Jenny set out that the charge as set out in the report was a mandatory charge, any other needs to be the subject of local agreement.


Chris Parkinson stated that housing growth is happening because of economic development – this should not be coming from schools budgets.  Jenny set out that funding for basic need growth was provided to the local authority through a specific allocation within the Schools Block.  This funding is on top of that for the NFF for schools so retaining school growth has no impact on the delivery of the NFF.  Jenny also pointed to the use of £0.6m of the local authorities growth allocation being used to fund the NFF delivery in 2019/20 as the DSG allocation was insufficient to fund the NFF.


Schools Forum approved the retention of a budget to fund school growth (paragraph 17, item 2).


Schools Forum approved the retention of budgets to meet the prescribed statutory duties of the local authority and to meet historic costs (Paragraph 17, Items 3 & 4).


Schools Forum approved the centrally retained early years funding of (Paragraph 17 Item 5).


Schools Forum noted the number and average cost of commissioned places for children and young people with High Needs (Paragraph 32).


Schools Forum noted the 2019/20 school funding rates (Paragraph 39).


Schools Forum noted the value Dedicated Schools Grant Reserve (Paragraph 48).


Schools Forum approved the action to be taken in respect of schools where the Special Educational Needs (SEN) notional budget is insufficient to meet the aggregated value of High Needs Funding Element 2 (Paragraph 50).


Schools Forum noted the average per pupil funding to be taken into account for recoupment for excluded pupils and other purposes (Paragraph 52).


That Schools Forum noted the payment rates for the Early Years Funding formula (Paragraphs 56 -57).


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