School funding for special educational needs

Parents and carers should have a clear understanding about how schools are funded, however, there is a surprising lack of simple and clear resources on this topic. It gets even more difficult when looking at funding for special educational needs (SEN) pupils, and how the amount per pupil is calculated.

The latest government data shows around 1.29 million SEN pupils attended state-funded nurseries, primary and secondary schools in 2022/23. This is the combined number of both students with education, health and care plans (EHCP) and those who do not have EHCPs. The number and percentage of pupils with SEN continues to rise each year.

Often, when researching about how SEN funding works in schools, many results that appear first are very old, some by a decade. We aim to help
parents and carers become better-informed with this up-to-date guide on
SEN funding in schools.

How are schools currently funded for SEN?

Funding to support pupils with special educational needs and disabilities (SEND) comes from two principal sources: funding transferred to individual schools through the schools block, and the high needs block.

These blocks form part of what is called the dedicated schools grant (DSG), the funding allocated from the central government to local authorities to fund schools. There are three aspects to this, known as elements 1, 2 and 3.

How is the funding amount calculated?

All state-funded schools, whether they are academies or council-run schools, receive their funding each year from the government. The National Funding Formula (NFF), introduced in 2018, is used by the government to ensure a school’s per-pupil funding reflects a number of factors, for example, the
number of pupils a school has.

Currently, the Department for Education (DfE) uses the NFF to work out a school’s ‘notional’ funding
allocation, which it then distributes to the school’s local authority (LA). The LA then applies its own local funding formula, through which it allocates a school’s budget.

Independent or private schools operate outside this system and raise their funding through fees. The government is gradually transitioning to a single national funding formula to decide how much money each school gets, where funding decisions will be made centrally without LA adjustments.

It is important to understand that the NFF is used to calculate how the total available funds should be distributed among schools, rather than being a tool that directly calculates each individual school’s specific funding needs.

What are the funding blocks?

The Core Fund (Element 1)

This is the money schools receive to fund each pupil regardless of SEN, called the ‘age weighted pupil unit’ (AWPU) and is sometimes referred to as ‘bums on seats’ money.

The government said that for academic year 2024/25, every mainstream school will attract at least £4,655 per pupil for primary schools and at least £6,050 per student in secondary schools through the NFF.

While this money is used to fund the school’s day-to-day costs, like teacher pay and energy bills, some of it is used to make general SEN provision, like providing a special educational needs coordinator (SENCO).

This core funding may not fully cover the additional costs associated with supporting pupils with SEN.

Additional support funding for schools: Notional SEN Fund (Element 2)

In addition to the core funding, element 2 funding provides SEN support that is additional to or different from the support that most other children get. Local authorities are required to identify a notional budget within the school’s block to assist mainstream schools in fulfilling their duty to meet the special educational needs of their pupils.

With element 2 funding, the government says schools should provide up to the first £6,000 of additional or different support for those children who need it, including those with an EHCP (or a ‘Statement of Special Educational Needs’). Factors that may be included in the calculation include deprivation, mobility, English as an additional language (EAL), and more.

However, the DfE stresses that the notional budget for SEN is not intended to provide £6,000 for every pupil with SEND, as it is believed that most needs will be met for less than this amount.

The notional SEN budget is a fixed amount of money allocated as part of each school’s overall budget – identified within a school’s delegated budget share or an academy’s general annual grant. It is not intended to provide a specific amount per pupil for those with lower additional support costs.

SENCOs are expected by the DfE to be aware of their school’s notional SEN budget and to be actively engaged with the senior leadership of the school in deciding what to spend on SEN support and provision.

High needs block (Element 3)

Element 3 is known as top-up funding or high needs funding. In the occurrence a school can provide
evidence that a child has needs that would cost more than £6,000, schools can apply for this funding to ‘top up’ elements 1 and 2, but there is no guarantee schools will get this.

The local authority is responsible for managing element 3 funding, which can be used to make specific
provision for an individual child or a group of children, as long as the school can prove their needs require the additional funding. Academies receive high needs funding from both the Education and Skills Funding Agency (ESFA) and local authorities.

The SEND code of practice states that: “a child or young person has SEN if they have a learning difficulty
or disability which calls for special educational provision to be made for him or her”. In 2014, the government introduced significant reforms to the way in which children and young people with SEND are identified and supported – requiring local authorities to have greater regard to the needs of children with SEND and their parents.

How does obtaining an EHCP impact funding?

EHCPs are for children and young people up to 25-years-old who need more support than is available through SEN support provided by a school. The plans set out the additional support required to meet those needs.

Not every child with SEND will be given an EHCP to support their needs. To understand if an EHCP would be helpful, the local authority will carry out an assessment for that child. The total number of EHCPs continue to increase.

The most recent data published by the government showed there were 517,000 children and young people with EHCPs as of January 2023. This is an increase of 9 per cent from 473,300 as of January 2022. This follows similar increases in recent years.

To provide for pupils with SEND, schools and academies usually need to fund the first £10k from element 1 and 2, and then call on additional funding from the high needs block.

So, what does it all mean?

SEND funding can be very confusing for parents striving to grasp how well their children’s needs are supported in mainstream schools. With more SEN pupils and EHCPs in mainstream schools, the adequacy of funding is a pressing concern.

Our guide hopefully sets out how funding currently works in an easy-to-understand way, and also explains why extra funding is needed. For insights into the support and resources available to SEND students in mainstream schools or academies, parents can refer to the school’s website or directly inquire with the school.