Soaring SEND bill fuels fear of £50m deficit in Hertfordshire County Council’s education budget

Headteachers and councillors are to consider setting a budget that would see Hertfordshire schools chalk up a £50m deficit by the end of next year, reflecting the escalating costs of supporting children with special educational needs and disabilities (SEND).

According to draft budget proposals, £1.5 billion is allocated to Hertfordshire schools and other education settings in 2025-26, of which £207m is ring-fenced for children with special needs.

That £207m – the ‘high needs’ budget – largely relates to children with education, health and care plans (EHCPs) in mainstream or special schools. It also funds early intervention support, education support centres and hospital education.

But with fears that £207m will not be enough, plans have been drawn up to set a budget that could include a £50m deficit that would be plugged by county council borrowing.

Hertfordshire has already lobbied the Government for an increase in ‘high needs’ funding – the county’s allocation per pupil is reported to be the fourth lowest in the country.

Officials say a “continuing and rapid” increase in the number of pupils with EHCPs plus rising costs are now making it “increasingly challenging” to control costs.

Cllr Caroline Clapper, Hertfordshire County Council (HCC) executive member for education, libraries and lifelong learning, says that without the deficit, the council will have to reduce services or special school places – and reducing services in this “crucial” area is “not an option”, she adds.

She said: “Hertfordshire receives one of the lowest settlements from Government for high needs provision and, despite lobbying for additional funding, our settlement once again this year does not cover the costs of providing the support our children need.

“In 2024, the council saw a 26% increase in requests for EHC plans when compared to 2023 and the cost of supporting these young people continues to outpace funding.

“This leaves the council with the option of either reducing services and specialist school places or accruing a deficit covered by borrowing.

“We are committed to supporting SEND children so that every child has the best start in life – therefore reducing services in this crucial area is not an option.”

Nevertheless, Cllr Clapper says that the situation – where she says the Government effectively allows for these deficits to be ignored for wider financial purposes – is “unsustainable”.

She says HCC will continue to call on the Government to urgently review and enhance financial support in this area.

According to its draft budget proposals, HCC will be required to ‘cashflow’ the deficit, incurring interest costs of around £2.585 million during 2025-26. And, it says, council reserves will need to be held as cover against the deficit.

This year (2024-25) the ‘high needs’ budget was set with a deficit of £18m, moving the entire county-wide schools budget into an overall deficit of an estimated £15m.

By the end of 2025-26, the council’s draft budget document suggests, the proposed £50m deficit would lead to an accumulated deficit of around £80m – and it is estimated that could rise to £384m by March 2029, which would incur interest costs of around £16m a year.

Nationwide, a large majority of authorities are overspending on their ‘high needs’ budgets. A report by the National Audit Office in September estimates cumulative deficits nationally could reach £4.6bn by March 2026.

Members of the Hertfordshire Schools Forum – made up of headteachers and other representatives – will consider plans for an unfunded £50m deficit at a meeting on Wednesday (January 15). The decision will then be subject to approval by HCC, as part of its budget-setting process.

According to HCC’s budget-setting document, as local authorities move into deficit on their ‘high needs’ budgets, they become eligible for intervention from the Department for Education (DfE). Currently, around 60% of authorities are in formal intervention programmes “with varying levels of DfE engagement”.

HCC’s budget proposals will be subject to public consultation and councillor scrutiny before a budget-setting meeting of the council scheduled for February 25.