Send Funding Crisis Reaches £6 Billion as Ministers Face Questions
The government is confronting mounting pressure to clarify how it will cover a massive £6 billion shortfall in special educational needs and disabilities (Send) funding, with ministers insisting their planned system overhaul aims to benefit children and parents rather than save money.
Education Secretary Bridget Phillipson has sought to reassure concerned Labour MPs that the extra costs of Send provision will not be taken from core schools funding, but will instead be covered by the overall government budget. This reassurance comes amid growing anxiety about how the Treasury will manage the rapidly escalating Send costs.
Budget Watchdog Highlights 'Significant Fiscal Risk'
The Office for Budget Responsibility has identified a £6 billion funding gap for 2028-29 that escalates to £9 billion by 2030-31. The watchdog classified this as a "significant fiscal risk" since the Treasury has not detailed how it will finance these obligations.
According to the OBR's analysis, if unresolved, this shortfall could equate to a 4.9% reduction in per-pupil school funding. This alarming projection has triggered calls for immediate clarity from government ministers.
Spending on Send provision by local authorities has reached £12 billion this year, representing a dramatic 66% increase over the past decade. Councils have spent billions beyond their budgets to meet legal obligations to children with special educational needs.
Government's Send Reform Strategy
Chancellor Rachel Reeves announced in the budget that the Treasury would assume full responsibility for Send costs from local councils beginning in 2028. Ministers have been developing changes to the Send system for months, with a white paper scheduled for publication in early 2026.
Phillipson told Labour MPs that the reforms would "bring cost down – for example, more local specialist places reducing demand for travel/ more costly private provision." She emphasized that the primary goal is fixing a system that frustrates parents and fails children, not reducing expenditure.
However, senior government sources acknowledged that the system changes would substantially slow the growth of the Send budget as a secondary effect. The government is already spending £740 million to increase mainstream specialist places, with figures showing educating a child in a specialist state school costs £26,000 annually compared to £63,000 in private provision.
Political Concerns and Proposed Solutions
The issue has become a major concern for Labour MPs, who report constituents worrying about potential changes to the Send system. The government appears nervous about potential backbench reactions similar to the recent revolt over disability benefits cuts.
Helen Hayes, Labour MP and education committee chair, stated that council deficits "have been a symptom of the wider crisis in the Send system which is failing children and families across the country." She emphasized that proper reform "won't come for free" and requires "investment in large-scale transformation."
The Institute for Fiscal Studies outlined three options for the government: reduce Send budget growth, increase Department for Education funding, or cut mainstream school budgets. Research fellow Luke Sibieta noted that £6 billion represents approximately 9% of the total schools budget for 2028-29.
The Liberal Democrats proposed a profit cap on private providers, with education spokesperson Munira Wilson calling the funding gap "an indictment of this government's failure to get a grip on the system." She criticized the "scandalous profiteering" in the sector that costs taxpayers millions.
Conservative shadow education secretary Laura Trott accused the government of concealing a "hidden £6bn blackhole" that could lead to either school cuts and teacher redundancies or reductions in special educational needs provision.
With the Send white paper due in early 2026 and full funding responsibility transferring to the Treasury in 2028, the government faces increasing pressure to provide detailed plans for addressing the growing financial challenge while ensuring children with special educational needs receive proper support.
