Dedicated Schools Grant
The question
To ask the Secretary of State for Housing, Communities and Local Government, with reference to the Local Government Finance Statement made on 23 February 2026, what assessment he has made of the potential impact of writing off 90% of Dedicated Schools Grant high needs deficits accrued to the end of 2025-26 on the economy; what the estimated value of write-off is by local authority; what steps he is taking to prevent deficits re-accumulating; and whether councils impacted by the write-off will face (a) borrowing restrictions and (b) additional oversight.
Answered by Alison McGovern
The government has set out details of a reformed SEND system which meets needs earlier, before challenges escalate. All local authorities with a SEND deficit are eligible for a grant to resolve 90% of their historic deficits up to 2025‑26— projected to be worth over £5 billion nationally—protecting their ability to support children and young people with SEND in local schools while sustaining wider services and tackling deprivation. Addressing deficits accrued to 2025‑26 could reduce financing costs by an estimated £300 million by 2027‑28.
Each local authority’s grant allocation will be determined by reviewing all available sources on local authority expenditure to establish the eligible SEND deficit. This will include comparing Section 251 data, draft and published Dedicated Schools Grant (DSG) notes, DSG s151 assurance, Revenue Outturn data and published accounts.
Grant eligibility is conditional on securing Department for Education approval of a Local SEND Reform Plan, which will also be used to assess ongoing performance and delivery to target support and challenge throughout the reform period.
Local authorities will continue to operate under existing prudential financial management frameworks.
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