Dudley Council is confronting a severe financial emergency, with leaders fearing effective bankruptcy, due to the rocketing costs of providing for children with special educational needs and disabilities (SEND).
The £56 Million Black Hole in School Funding
The heart of the crisis is a massive and growing deficit in the Dedicated Schools Grant (DSG). This is the ring-fenced funding from central government for schools and SEND services. Dudley's shortfall is forecast to hit a staggering £56 million by the end of the current financial year.
This deficit represents the critical gap between the funding received and the actual expenditure required to meet the council's legal duties to support children with special needs. A temporary accounting rule, known as the statutory override, is currently shielding the council's main accounts from this debt. However, this protection is set to expire after the 2028/29 financial year.
Budget Promise Leaves Historic Debt Unanswered
In the recent Budget, Chancellor Rachel Reeves announced a significant national change. From the end of 2028/29, the government will take over responsibility for paying future high-needs SEND education costs. For Dudley, this future shift is estimated to save around £30 million annually in running costs.
Despite this long-term pledge, the government has not outlined any plan to help the council tackle its existing £56 million historic deficit. Council officials are now anxiously awaiting further details in the upcoming Local Government Finance Settlement and the promised white paper on SEND reforms.
Local Demand Skyrockets Above National Average
The financial strain is exacerbated by a dramatic and disproportionate rise in demand for SEND services within the borough. Between 2019 and 2024, Dudley saw an 88% increase in its SEND caseload. This surge far outpaces the national average increase of 62% for the same period, placing extreme pressure on local resources and budgets.
The situation leaves Dudley Council in a precarious position, caught between a future funding lifeline and a present-day financial abyss, with vulnerable children's services hanging in the balance.
