Agenda item

This report sets out the final Schools Block allocation of the Dedicated Schools Grant for 2025/26 following the receipt of final funding allocations and the Authority Proforma Tool (APT) in December 2024.

Tony Burton (Head of Finance for Children’s Services and Education) presented the item which set out the final school's block allocation of the Dedicated Schools Grant (DSG) for 2025/26 following the receipt of final funding allocations and the Authority Proforma Tool (APT) in late December 2024. He highlighted that per national funding guidance in indicated pupil funding had increased by 1.72% for Hammersmith and Fulham mainstream schools, versus a 2.3% increase nationally. Total funding allocations had decreased in cash terms year on year due to the reduced number of pupils in mainstream schools.

The Teachers Pay Additional Grant (TPAG), Teachers Pension Employer Contribution Grant (TPECG) and the Core Schools Budget Grants (CSBG) which were separate grants in the 2024/25 financial year had all been incorporated into the final 2025/26 schools block allocation. A 2025/26 baseline adjustment was made by the Department for Education to incorporate these grants into the mainstream funding allocation of £6.815m.

Tony Burton noted that responses from the school's block 2025/26 budget consultation supported the principles for allocating the 2025/26 schools block budget and the transfer of 1% of the school's block budget to the high needs block for the 2025/26 budget. Minimum funding guarantee was set at minus 0.25% and mirrored the National Funding Formula (NFF) factor rates allowing for a percentage uplift of 0% on the inner London NFF rates. Should the disapplication for 1% transfer from the school's block to support the high needs block be rejected by the Minister of State, the alternative 0.5% transfer model would be used to distribute block funding to schools.

Tony Burton also pointed out that the reduced pupil numbers in mainstream primary schools had caused the de-delegated and education functions budgets to decrease year on year and noted that maintained schools license was now paid directly by schools. Due to the tightening of regulations, a separate falling rolls fund could not be established.

The Central Services Schools Block reduced in three ways for 2025/26:

·         A 1.5% reduction in core funding per pupil

·         A reduction in total funding due to the reduction in pupil numbers in mainstream schools

·         A reduction in the historic central services allocation of 20% year on year, impacting its ability to support high needs block.

Karen Cunningham (St John XXIII Catholic Primary) asked if pupil placement planning would take place to address gaps in schools rolls. Peter Haylock (Director of Education and SEND) responded that with a reduced number of two form entry schools, the scope for planning around rotating plan reductions was limited.

Alex Parker (Observer) asked for further clarification on the pupil funding increases. Tony Burton explained that funding allocation was determined by the number of pupils on roll. The model mirrored the NFF, including a core rate to reflect some of the grants being incorporated into the mainstream budget. MFG would provide protection on a per pupil basis for pupil led funding levels in the National Funding Formula year on year. Tony Burton suggested that funding levels in Hammersmith and Fulham were likely to converge with the NFF over a number of years and it was therefore possible schools in the borough may experience constrained funding growth versus the national picture over the medium term. However, more would be known after the government spending review this year and once the development of the NFF in the medium to longer term was better understood.

Alex Parker further asked how the 1.7% per pupil funding increase was calculated. Tony Burton replied that the schools block baseline included the full year effect of the additional grants received in 2024/25.

Alex Parker also asked what minus MFG meant. Tony Burton noted that MFG gave protection only to pupil-led funding. If that was not met, MFG would allocate funding to schools up to -0.25% on pupil-led funding level.

Peter Haylock noted that despite the 1% high needs block transfer, pressure on high needs block had not reduced. While pupil numbers had decreased, demand for SEND support was increasing and the complexity of cases was also increasing. The high needs reference group would meet the week after to review key areas, aiming to meet as much needs as possible in maintained schools.

RESOLVED

1.    It is recommended that the January 2025 APT for the recommended model is submitted to the ESFA for the 2025 to 2026 schools budget share. This is with the revised uplifted NFF rates detailed in paragraph 4 and in appendix 1 with area cost adjusted NFF rates, MFG value of minus 0.25% per pupil and a 1% block transfer (£1.23m) to support High Needs in 2025/26. The recommended model will be submitted on Wednesday 22^nd January 2025 and is subject to Ministerial approval.

2.    That Schools Forum agreed that in the case that the Minister of State rejects the recommended model at the 1% transfer level, that the alternative model with 0.5% block transfer (£0.615m) is adopted for 2025/26.

3.    That maintained school representatives at Schools Forum agreed to the proposed 2025 to 2026 de-delegation budget of £0.555m.

4.    That maintained school representatives at Schools Forum agreed to the proposed 2025 to 2026 education functions budget of £0.289m.

5.    That Schools Forum agreed to the central services school block budget allocations proposed for 2025/26.