Issue details

Proposed decision –

That the Cabinet Member for Education and Skills:

(a)  Approve a policy change to the funding arrangements for the following services, that from 1 April 2026 these shall be provided from the maintained schools’ budgets in line with the funding all schools receive under the National Funding Formula, as is currently the case for Academies, and that the Council shall cease to provide additional funding for these:

• Statutory compliance testing and surveys, including tree surveys;
• Health and Safety advice and training;
• Employment tribunal awards and associated legal costs;
• Staff care (occupational health advice); and
• Administration of teachers’ pensions.

(b)  Delegate authority to the Corporate Director for Children, Young People and Education, in consultation with the Cabinet Member for Education and Skills, to (1) take the relevant actions to progress the decision, including as necessary seeking the agreement of the Schools Funding Forum to top-slicing or alternative or revised proposals as required, and (2) in the event it may become necessary, to then take all necessary steps to seek formal determination by the Secretary of State.

(c)  Delegate authority to the Corporate Director for Children, Young People and Education to take all relevant actions including but not limited to entering into relevant contracts or other legal agreements as required, to implement the changes required to give effect to this decision, including implementation of the proposal where it is approved by the Secretary of State provided that such determination aligns with the intended outcome of the decision

Reason for the decision

The national funding arrangements for schools and local authorities have been shifting over the years.  With the introduction of the School Funding Reforms in 2013-14 Local Authorities were directed to delegate a number of former centrally retained Dedicated Schools Grant (DSG) budgets to schools for the first time.  At the time, a total of £8.7m of DSG funding was delegated to schools from 1 April 2013 and at the same time, local Schools Funding Forums were given the powers to de-delegate funding.  This is where some of this funding is returned to the LA for certain categories of spend where better efficiency could be achieved through central delivery by the LA.

The Education Services Grant (ESG) allocated to local authorities by the Government for the provision of statutory services in relation to schools was withdrawn in 2016/17.  The DfE introduced a provision within the School Funding Regulations for local authorities to agree a contribution from LA maintained schools budget shares towards the cost of statutory services (top-slice). This principle reflects the charge that most Multi Academy Trusts (MATs) place on their schools for central services.

With the introduction of the National Funding Formula and the withdrawal of Department for Education (DfE) funding to Local Authorities to support schools, we have seen funding shifting from Local Authorities to schools to pay for services.

The Council currently funds a range of services which are provided to maintained schools.  Following consultation with maintained mainstream and special schools, and pupil referral units (PRUs), a decision is needed as to whether the Council or schools’ budgets will pay for certain services from 2026-27.  These are:

• Statutory compliance testing and surveys, including tree surveys;
• Health and Safety advice and training;
• Employment tribunal awards and associated legal costs;
• Staff care (occupational health advice); and
• Administration of teachers’ pensions.

The services in question currently cost the Council £2.6m.  The receiving maintained schools and PRUs already have funding to deliver these within their delegated budgets, as per the National Funding Formula.  The proposed decision is for the Council to cease spending £2.6m of General fund providing these services to maintained schools and PRUs, and for the schools and PRU to meet the costs of these from their delegated budgets.

This would deliver a £2.6m saving to KCC without necessarily resulting in any reduction of service, as the affected schools are in a position to use their dedicated budgets to continue to secure the services themselves.

Options (other options considered but not proposed)

A review of the services provided to schools by the Council considered, for each area of service delivery, whether the service should “continue, stop, reduce or change”.  

For change in 2026-27, the five areas of service delivery set out above were identified, and have been subject to consultation.  In respect of four of these: statutory compliance, health and safety, employment tribunals and administration of teacher pensions, the Council has to discharge its statutory duties, and thus cannot stop providing the services.  However, finance regulations provide for the costs of these to be funded through schools’ budgets (i.e. change).  The option to reduce support continues to exist, but was not the preferred option.  Continuing without change was not seen as a viable option, because funding has moved from the Council to schools.  In respect of occupational health, the proposal is to cease providing this support for free.  Schools are responsible for their staff. 

How the proposed decision supports the Framing Kent's Future - Our Council Strategy 2022-2026

Priority 1 of Framing Kent’s Future sets out the Council’s commitment to maintain KCC’s strategic role in supporting schools in Kent to deliver accessible, high quality education provision for all families.  It states the Council will maintain improvement support services for all Kent schools, including maintained schools and academies, to maintain Kent’s high-quality education system.

The proposals seek to secure the funding necessary to enable the Council to deliver this commitment. 

How the proposed decision supports Securing Kent’s Future 2022 -2026: Securing Kent’s Future - Budget Recovery Strategy.pdf

The Council has continued to provide the above services at a cost of c£2.6m.  The proposals collectively, if agreed, would result in schools meeting this cost.