Warning of 20bn timebomb as Reeves switches Send funding in England to education department

"The government will take over full responsibility for special educational needs spending from local councils, it was revealed at the budget, prompting warnings that the Department for Education could be facing a 20bn timebomb in two years. The Office for Budget Responsibility said the annual costs of special educational needs and disability (Send) spending in England would reach 6bn a year by 2028, increasing the urgency of a potentially decisive overhaul of Send provision in a schools white paper expected early next year."

"The government must also decide how to deal with historical council Send deficits, projected by the OBR to reach 14bn by 2028. This sum is made up of Send overspending incurred by English councils since 2020. Although the government announced in the budget it was to take over full responsibility for Send spending from April 2028, it has yet to reveal how it will pay for the accumulated council deficits and the ongoing extra spending."

"If the projected 6bn-a-year extra costs were to be fully funded through the DfE's core schools budget, this would imply a 4.9% real fall in mainstream schools spending per pupil from 2028-29 rather than a planned 0.5% real-terms increase, the OBR said. A DfE spokesperson said the OBR's forecasts for Send spending did not include future policy changes. We are clear that any deficit will be absorbed within the overall government budget."

The government will assume full responsibility for special educational needs and disability (SEND) spending from local councils from April 2028. The Office for Budget Responsibility projects SEND annual costs in England at £6bn by 2028 and historical council SEND deficits reaching £14bn, creating a potential fiscal exposure near £20bn. The government has not specified how it will fund accumulated deficits or ongoing higher spending, which the OBR calls a significant fiscal risk. Funding the £6bn from the Department for Education core budget would imply a 4.9% real fall in mainstream schools spending per pupil from 2028-29. The DfE says forecasts exclude future policy changes and any deficit will be absorbed within the overall government budget.

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