Suffolk SEND overspend forecast at £109m despite write-off

Why it matters: The figures, in a budget monitoring report going before the council's cabinet on Tuesday, 10 November, show demand for SEND support in Suffolk continues to outstrip funding. Even after a £147.5m government grant arrives on 30 November, the council is forecast to remain £125.7m in the red on SEND.

The details: SEND education placements are paid for from the Dedicated Schools Grant (DSG), a ring-fenced government grant kept separate from the council's main budget.

• The High Needs Block of the grant, which funds SEND educational placements, is forecast to overspend by £110.7m in 2026-27.
• Small underspends elsewhere in the grant bring the overall overspend down to £109.3m.
• The council's accumulated DSG deficit stood at £163.8m on 31 March 2026.

The write-off: After the Department for Education approved the council's Local SEND Reform Plan in October, the government agreed to pay Suffolk a £147.5m High Needs Stability Grant on 30 November.

• The grant covers 90% of the deficit built up to 31 March 2026, with the remaining 10% left for the council to manage.
• Combined with this year's overspend, the deficit is forecast to fall to £125.7m by 31 March 2027.

What has changed: The report states that the forecast overspend "has significantly changed since the Reform Plan was submitted" at the start of the financial year.

• Independent and non-maintained school placements are forecast to cost £2.6m more, with pupil numbers "already exceeding the level originally forecast for December 2026."
• Special school top-up funding is up £1.9m, following a new funding agreement at Thomas Wolsey School, the opening of new specialist units from September 2026 and additional place funding.
• Academy and free school top-ups are up £1.7m due to an "increase in numbers and complexity of need."
• These increases are partly offset by a £2.8m reduction in forecast spending on bespoke packages.

The funding gap: The report says part of the national funding formula is based on spending dating back to 2017-18, which "fails to recognise where patterns of spend have grown exponentially in that period due to demand locally."

"Financial resources have therefore not supported the sharp increase in demand in Suffolk compared to both England and statistical neighbours," it states.

The knock-on cost: Although the DSG is ring-fenced, the report says the deficit "has a real cash impact on the Council." Even with the new grant, the extra borrowing needed to cover the deficit is forecast to push the council's net interest costs £6.3m higher this year than they would otherwise be.

Beyond the classroom: SEND pressures are also hitting the council's main budget.

• SEND home-to-school travel is forecast to overspend by £2.2m. The report links this to the rising number of Education, Health and Care Plans (EHCPs) and "the success in clearing the backlog of EHCPs over the last year."
• The council's Inclusion service is £1.5m over budget, including £800,000 for agency staff in SEND statutory services and £700,000 for investigation and compensation payments, which are either directed by the ombudsman or offered after an upheld complaint.
• The report states: "To date, each month about 35 payments have been agreed."

Building capacity: Of the £22.1m available for SEND building projects this year, £10.2m is forecast to be spent, with the delays largely due to projects being re-evaluated as part of the Local SEND Reform Plan.

• Projects include 60 additional places at The Ashley School in Lowestoft, due to be completed by December 2028.
• Smaller projects are planned at schools including The Willows Primary School in Ipswich.

What's next: From 2028-29, responsibility for SEND spending will move to central government, meaning "councils will no longer carry SEND funding risk."

• Until then, SEND deficits arising after 2025-26 will receive "appropriate and proportionate" support from the government, "though not unlimited."
• The report warns that even after the change, "the Council will retain a significant residual accumulated DSG deficit."
• The statutory override allowing councils to hold a negative DSG balance is due to expire on 31 March 2028.

The bigger picture: Suffolk is not alone, with the report noting that most other local authorities with education responsibilities also have negative DSG balances.

• Separately, the council is forecasting an £11m overspend on its main budget for 2026-27.
• The report concludes that the council "is facing sustained financial challenges, where funding is not keeping pace with rising demand and costs, in particular for Social Care and SEND."

The bottom line: A £147.5m government write-off will ease Suffolk's SEND deficit, but with spending forecast to run £109.3m over budget this year, the council expects to be left with a significant shortfall even after national reforms take effect in 2028-29.

Don't forget: If you enjoy our content, please add Ipswich.co.uk as a "preferred source" on Google so you can easily find more of the content you value.

This article cost us ~£34 to produce

It's free for you to read thanks to the generous support of our partners. Please support us by supporting them.