Bristol City Council is nearing a financial crisis due to rising special needs costs. Without government support, the council risks severe budget shortfalls and potential bankruptcy.
The council leader warns that the situation is serious. Costs for supporting children with special needs are increasing, but funding isn’t keeping up. The council is still waiting for the government to address this national issue.
If the government doesn’t act, Bristol and other councils could go bankrupt. An update on the schools budget was shared recently, ahead of a full council meeting later this month.
Next year’s schools budget is £548 million. Out of this, £98 million is for special needs education. Although the government added £1 billion for special needs last year, it won’t cover the growing demand.
Hannah Woodhouse, the executive director of children and education, mentioned that the funding increase isn’t enough. The demand for support is high, and the extra money won’t meet the needs.
The deficit is projected to reach £53 million by March and £58 million by 2026. The council has been allowed to carry over this shortfall, but that permission ends in March. They will struggle to pay it off.
Councillor Tony Dyer said the deadline is approaching. If the permission isn’t extended, the council will face a serious situation, along with many others.
Ms. Woodhouse noted that the Department for Education is aware of the issue but hasn’t provided formal updates.
Adding to the pressure is a court case about whether the council broke the law when signing a deal with the government. This deal involves the government giving the council money to help with the deficit.
A recent judicial review questioned if the council should have consulted parents about the deal’s impact on their children. The council disagrees with this claim, and a decision is expected soon.
If the judge rules against the council, the government might try to reclaim the bailout money, which could worsen the financial situation.
Cllr Dyer mentioned that the deal was initiated by the previous government. They are waiting to see if the new government will change its approach.
Despite the deal, the council is still at risk when the permission ends. The bailout funds could help avoid bankruptcy, which some councils in England have already faced.
In the meantime, the council is working to create more specialist places in Bristol. This will help prevent sending children to expensive independent schools outside the city. This year, they plan to add 95 new places, with more next year.
Last December, the Local Government Association asked for clarity on the permission’s extension. The government was supposed to outline plans for councils facing financial collapse but didn’t.
According to the National Audit Office, two out of five councils in England could go bankrupt if the special permission expires. Their analysis shows that many local authorities are nearing their financial limits, indicating a need for urgent reform in the special educational needs system.
The crisis began over a decade ago when councils were required to support children with special needs but didn’t receive enough funding. Since then, the number of children needing support has increased significantly.
Cllr Dyer emphasized the importance of lobbying for proper funding when new requirements arise. The current situation shows the consequences of asking councils to do more without providing the necessary resources.
