Agenda item

To review the proposals for the Education Budget 2019/20.

The Head of Finance introduced the report which detailed the components of the budget for the coming year. The total allocation for Croydon which is regulated by the Department for Education (DfE) was £342mil for the four blocks for 2019/2020. The DfE announced that the implementation of the National Funding formula would be introduced as a soft formula for schools for next year.

It was further explained that the DfE had introduced a requirement for each authority to produce a three year recovery plan in the event that a 1% or more deficit was incurred in the year. Officers informed the Sub-Committee that Croydon as well as other local authorities would definitely have a deficit of more than 1% especially due to the high needs block. There were concerns at the lack of detail and guidance on this as yet and during consultation strongly expressed that three years was too short for a recovery period. They would continue to highlight that the suggested three years was more of a medium term programme of recovery.

It was explained to the Sub-Committee following comment by a Member that  when the DSG was introduced it was based on deprivation as well as other factors, and in 2005 the amount that local authorities received was frozen with additional spend plus adjustments made to the per pupil funding. This meant that the amounts received were locked in irrespective of changes to demographics and deprivation levels. This has been to some local authorities advantage but not to Croydon’s. However the New National Funding formula would mean that more recent demographic factors will be taken to account going forward.

It was expressed that it would be beneficial for the table that showed comparisons with other Local Authorities to include all of the London boroughs. Officers agreed to circulate this after the meeting.

It was noted that the report alluded to the funding differential between Croydon and other boroughs and question if there was any further documented evidence that would enable the Council to make a case to central government on the low funding allocation for the borough. Officers agreed to research this and report back to the Sub-Committee.

A Member expressed that the implications of the deficit that the DfE required local authorities to produce a recovery plan for was not quite clear and further clarify of this would be beneficial. Officers responded that there were concerns due to the lack of guidance from the DfE to date but that steps were already been taken such as early intervention on SEN to mitigate the high costs associated with the High Needs block. The LA will have to consider many factors in development of the recovery plan such as good commissioning, clear pathways, and financial implication to areas of service. Health, Education and Social care will have to work together on the plan.

It was further commented by a Member that a communication strategy with the residents of Croydon would have to be considered in the event that the Council finds itself in a situation of recovery.

It was questioned how capacity on schools affect the budget and the schools financial position. Officers replied that some schools in the borough were in deficit positions and they worked extensively with these school that have capacity on exploring ways to address issues such as reducing their PANs, combining classes, teacher ratio as well as learning and good practice form other schools.

The Sub-Committee was informed that the schools forum made a decision to increase the funding allocation that was awarded through the DfE funding formula from £110k to £114k for 2019/20.

Officers were thanked for their responses to questions.

Information request by the Sub-Committee

• A table that reflected all the 32 London Borough’s DSG 2019/20 Schools block allocationsper pupil
• School block funding – documented evident of low funding and its effects.

In reaching its recommendations the Sub-Committee came to the following Conclusions:

1.   The Sub-Committee were concerned about the risks arising from the lack of government guidance on the requirement for local authorities to have a recovery plan in the event that their Designated Schools Grant budget falling below a 1% deficit.

2.   It was clear that Croydon’s Designated Schools Grant funding allocation was insufficient for the borough’s need and that the funding differential to other local authorities was evident.

3.   The Sub-Committee were pleased to note that information was being gathered to evidence Croydon’s low funding allocation, enabling the Council to present a case for fairer funding to the Department for Education.

The Sub-Committee resolved to recommend that:

1. Cabinet Member for Children, Young People and Learning that the Council and its partners should be meeting in preparation for the eventuality of the Council finding itself in the position of having to utilise its recovery plan.