Nearly £59 million of education budget debt could be written off by government if West Northamptonshire Council submits SEND reform plan by this summer

West Northamptonshire Council (WNC) is estimated to have accrued a cumulative deficit of £65 million on its Dedicated Schools Grant (DSG) by the end of the last financial year, as the cost and demand for alternative provision and specialist school places have put significant strain on local authorities.

The government announced earlier this year that 90 percent of councils’ historic DSG deficits would be wiped out. However, to access the funding committed to clearing these debts, local authorities must submit a local SEND reform plan to the Department for Education (DfE) by June 19.

These must show how the council will meet the programme of reforms set out in the Schools White Paper, which includes expanding inclusive practice and SEND provision in mainstream education, improving access to expert support without statutory assessment, and changes to the use of EHCPs.

Speaking at a cabinet meeting discussing the plan, WNC’s director of children’s services Melanie Barnett said there was still a lot of uncertainty around the funding and what would happen to the deficit post 2025/26. She also called the timescales councils must comply with for the plan “completely unreasonable”.

The Secretary of State for Education wrote to all local areas about their requirement to come up with a reform plan on March 9. WNC says its final draft must be submitted to its DfE advisor by Friday May 15.

Councillor Fiona Baker, who previously held the portfolio for children and education under the previous Conservative administration, also commented: “We all want the best that we can for children and the rise in children coming forward with special educational needs is huge.

“I’m concerned really not about any of the things that are in the hands of our officers because I do rate them as very capable. The concern is about the funding.

“Our DSG at this stage is overspent to an enormous amount, and it will be rising, and there seems to be various hoops to go through to get funding from this DfE plan, with no clear clarity on how that will happen.

“It’s a very tenuous thing, as far as I can see, that we’ll do all this and then not get any money.”

If the plan is not approved by the Secretary of State, WNC will miss out on the first round of payments, which will be made this autumn. It would then have a second chance to revise and improve its plan to receive the payment in spring 2027.

It has not yet been determined how the remaining 10 percent of the SEND deficit, which would equate to around £6.5 million in West Northants, will be funded.

A statutory override, which is in place until 2028, has kept DSG deficits off council balance books to prevent many from declaring effective bankruptcy.

According to the cabinet papers, ongoing financial support to clear any future DSG deficits arising in 2026/27 and 2027/28 will be linked to “demonstrable delivery” against the council’s approved reform plans.

Persistent failure to demonstrate progress may result in formal intervention, including the removal of responsibility for SEND service delivery.