Agenda item

To consider the Dedicated Schools Grant 2026/27.

The committee considered a report on the Dedicated Schools Grant (DSG) for 2026/27.

The report:

·         Provided the committee with an update on the DSG for 2026/27.

·         Sought approval for the allocation of each sub block making up the DSG.

·         Sought approval of the schools funding formula and early years funding formula following recommendations from the Schools Forum.

·         Sought approval to provide delegated authority to the Executive Director of Children’s Services to use the funds in accordance with the relevant guidance and proposed funding formula methods.

Key funding movements were highlighted to the committee, which included increases in the overall DSG, the Schools Block and Early Years Block.  The continuing rise in EHCP demand, with nearly 500 additional plans in the past 9-12 months was also noted.

Regarding the Schools Forum vote, Members heard that although the Forum had not supported the transfer, the outcome reflected wider national frustrations about school funding pressures - rather than disagreement with the Local Authority.  It was emphasised that the DfE had considered the transfer through the lens of system?wide need and the needs of all children.

The committee asked questions and made comments in respect of:

·         The real impact on school budgets and how the proposed use of transferred funds differed from existing provision.

·         DfE expectations regarding investment in inclusive mainstream provision.

·         The committee welcomed the context provided on the Schools Forum vote and stressed the importance of assessing the impact of spending on inclusion.

·         The implications of early years termly census changes.

·         The system and data issues raised in Appendix 7, in particular the issues experienced with the Controcc system.

·         The importance of strengthening and understanding inclusion and inclusivity whilst acknowledging the financial strain on schools, particularly those that were smaller and located in more rural settings.

In response, officers reported that:

·         All consultation materials and school?level modelling were available via the Schools Forum pages on the Council’s website.  Hyperlinks were included at paragraph 27 of the report.

·         Additional capacity was required to deliver the Inclusion Framework, provide workforce development for schools, strengthen specialist support and ensure consistent, ongoing engagement across all phases.  Existing services would be enhanced, not duplicated.

·         Cheshire East would be required to report regularly to the DfE under strengthened SEND financial oversight, supported by an independent chair of the SEND Improvement and Assurance Board.

·         The initial issues affecting the Controcc system had been resolved; some remaining issues were being worked through.

·         Moving to a termly census would increase accuracy but reduce the numbers reported annually; transitional funding would ensure no financial shortfall in 2026/27.

RESOLVED (Unanimously):

That the Children and Families Committee

Schools Block

1. Approve a formula for the adoption of the Schools Funding Formula 2026/27:

i.              The use of a local funding formula that uses the Department for Education (DfE) national funding formula factors, uplifted for the Cheshire East area cost adjustment, and with any additional funding being allocated via the basic entitlement factor. The formula factors are set out at Appendix 2.

ii.            The use of -0.5% as the minimum funding guarantee percentage.

iii.           Setting a local Growth Fund at a value of £0.483m.

iv.           A transfer of 0.75% from the schools block to the high needs block in line with the DSG Management Plan approved by committee in September 2025.

2. Delegate authority to the Executive Director of Children’s Services to use the schools block grant in accordance with relevant guidance during 2026/27.

3. Delegate authority to the Executive Director of Children’s Services to make disapplications to the DfE should it be required during 2026/27.

Early Years Block

4. Approve the following for the adoption of the Early Years Funding Formula for 2026/27:

i.              The continued use of the current funding formula that passes the funding allocation to providers of the early education entitlements in 2026/27 in line with the DfE minimum pass-through requirement of 97%.

ii.            Amend the methodology to create a Special Educational Needs Inclusion Fund (SENIF) from, a percentage of the EYDSG allocation as used previously, to creating a SENIF fund based on the proportion of allocated early education hours.

iii.           Increase the hourly rates by the same percentage increase as the increased funding from the DfE plus the additional funding from the amended methodology for SENIF.

iv.            The new funding rates. The proposed rates for 2026/27 are set out at Appendix 4.

5. Delegate authority to the Executive Director of Children’s Services to accept in-year budget increases and use the early years grant in accordance with relevant guidance during 2026/27.

6. Delegate authority to the Head of Service Early Years, Family Help & Prevention to enter into revised contracts with providers in accordance with the DfE funding increase during 2026/27.

High Needs Block

7. Approve the provisional budget allocations of the high needs block and additional high needs funding as set out in Appendix 5.

8. Delegate authority to the Executive Director of Children’s Services to use the high needs block and additional high needs funding in accordance with relevant guidance during 2026/27.

Central Schools Services Block

9. Approve the provisional budget allocations and use of the central schools services block as per Appendix 6.

10. Delegate authority to the Executive Director of Children’s Services to use the Central Schools Services grant in accordance with relevant guidance during 2026/27.